STATE OF CONNECTICUT
THE STATE COMPTROLLER
WYMAN PROJECTS $91.2 MILLION DEFICIT FOR
FISCAL YEAR 2002
Comptroller urges state officials to be cautious
|Contact: Steve Jensen|
State Comptroller Nancy Wyman today announced the state will end the 2002 fiscal year with a deficit of nearly $91.2 million, due primarily to a drop in income tax revenues.
Wyman said her deficit estimate - at $91,182,000 - is a result of the state income tax declining $50.4 million from last month. This includes payroll taxes as well as shrinking capital gains. Total General Fund revenues are expected to fall short of the budget plan by $48.2 million. Adding to the deficit are projected state agency deficiencies of $39.6 million and $3.5 million in miscellaneous adjustments.
"Connecticut is following a national trend," Wyman said. "Twenty-two states have revised downward their revenue estimates and more are sure to follow. Declines in the stock market and uncertainty over the state of the economy in wake of the recent terror attacks put us in a volatile position."
Wyman urged state officials to not make rash judgments about the state of the economy considering that the state is still very early in its fiscal year.
"If current trends continue, Connecticut will finish the fiscal year with a sizeable deficit, but those trends could change easily," Wyman said. "The fact is we don't know at this time what impact our national tragedy will have on the longer-term economy."
Contributing to the decline in state income tax receipts is the fact that Connecticut had 3,700 fewer jobs in August than it did one year ago. Both the withholding and estimated payments components of the income tax are falling. For the month of August, a 6.7 percent decline in income tax receipts was posted.
A few bright spots do exist in the economy, Wyman said. Energy prices have stabilized and are declining. The Federal Reserve continues to reduce interest rates, which puts more money in consumers' pockets. The new economy sector is still growing, and fiscal policy at the federal level is putting economic stimulus as a top priority.
The State Comptroller appreciates input on this and other issues from residents of the state. Please feel free to contact her office by phone - (860) 702-3300; mail - OSC, 55 Elm Street, Hartford, CT 06106; or, via E-mail - firstname.lastname@example.org
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