HARTFORD, CT — Nonpartisan legislative analysts still believe Connecticut will end this fiscal year with a budget deficit due to mostly lagging revenues.
The Office of Fiscal Analysis isn’t backing away from its previous projections regarding lagging personal income and sales tax revenues. However, between February and March, part of that deficit has been offset by improvements in the Department of Social Services budget.
Legislative analysts said Monday that they still expect the state to end the year with a $45 million budget deficit. But that’s a $20.2 million improvement over its projections in February.
A delay in converting group homes to private providers has saved the state about $7.3 million and about 160 fewer families per month are seeking cash assistance from the state for a savings of about $9 million. The adopted budget anticipated about 26 fewer families would be seeking cash assistance on a monthly basis.
Income tax collections are still down about $141.5 million and sales taxes are down $79.3 million, according to OFA.
Office of Policy and Management Secretary Ben Barnes released his monthly fiscal projections on March 20 and predicted the state would end the year with a $22 million surplus.
However, OFA, unlike Barnes is using more current revenue projections in their estimates. Barnes is still using the revenue the two branches of government agreed to in January.
“As noted in previous forecasts, April collections reflecting final income tax receipts will be the most significant factor in determining year-end balance,” Barnes wrote.
While that’s accurate the state receives daily information about revenue collection from the Department of Revenue Services.
State Comptroller Kevin Lembo will release his budget estimates for fiscal year 2017 on April 3.
But lawmakers and budget analysts are waiting for the income tax filing deadline to get firm numbers. This year April 15 falls on a Saturday, so the tax filing deadline falls on Tuesday, April 18. That means state officials won’t have a more complete picture of revenues until the following week.
The two-budget writing committees have until April 27 and April 28 to release their own budget proposals for the next two years.