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WYMAN PROJECTS YEAR-END SURPLUS OF $247.4 MILLION, SAYS INCOME TAX REMAINS BIGGEST CONTRIBUTOR

Contact: Steve Jensen
860-702-3308/3301

State Comptroller Nancy Wyman today projected the state will end the 1999 fiscal year with a budget surplus of $247.4 million, and said the figure could grow significantly higher if the economy does not falter.

Wyman said the major reason for the surplus continues to be the state income tax, which is expected to generate about $3.5 billion, or nearly $200 million above original estimates. Other contributors to the anticipated surplus include the corporation tax and sales tax, which together are predicted to produce nearly $55 million more than was originally forecast.

Also, the state will spend about $52.6 million less than anticipated on income tax refunds.

"Connecticut has recently seen slower but still-steady growth in both income and employment," Wyman said. "If these trends continue as we expect, there is a good chance that the surplus could rise much higher by the end of the fiscal year."

Wyman's surplus estimate is $81.5 million lower than a projection of $328.9 million made last week by the state Office of Fiscal Analysis (OFA), the legislature's budget office. She said the variance is mainly due to OFA's inclusion in its projection of about $50 million in additional revenue from the anticipated sale of housing loans from the General Fund to the Connecticut Housing Finance Authority (CHFA).

Wyman did not include the expected one-time $50 million windfall in her estimate because the administration has indicated that current fiscal conditions do not warrant the sale of the loans to CHFA. The remaining $31.5 million difference between the two surplus estimates is explained by OFA's use of slightly lower spending projections.

Wyman's estimate of a $247.4 million surplus, however, is $76.7 million higher than a surplus prediction of $170.7 million made recently by the Office of Policy and Management, the Governor's budget office. She attributed the difference to her use of somewhat more optimistic revenue predictions based on Connecticut's stronger-than-anticipated economic performance.

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For Immediate Release
December 1, 1998

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