Comptroller Sticks to Surplus Projection
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The state's general fund should finish the fiscal year, which ends in June, with a $120 million surplus, State Comptroller Nancy Wyman projected today.
It was the third straight month Wyman has predicted such a surplus, based on income and sales tax collections greater than those set out in the state budget.
Once again, the Comptroller repeated her caution about creating new programs to be funded by the surplus. "Even though tax collections are outpacing spending, we should avoid thinking that these conditions are guaranteed in the future," Comptroller Wyman said. "We should continue to build up the reserve fund to its statutory five percent of the annual budget, any pay off state debt after that."
According to Wyman's monthly letter on state finances, general fund spending for the year is estimated to be $103.8 million higher than budgeted. The largest items in this increase are Medicaid ($47.4 million more than budgeted) and care for children in foster and residential care ($30.7 million over budget). Comptroller Wyman has requested from the Department of Social Services an explanation for the overruns in Medicaid costs, which were expected to drop with the advent of managed care for most Medicaid recipients.
Tax collections will overshadow the higher spending, however. The income tax, expected to come in $125 million over budget, has been boosted by non-inflationary national economic growth, booming financial markets, and state job growth, Wyman wrote. Sales tax collections will be greater by $98.3 million, Wyman predicted, thanks to higher consumer confidence in the state's improving economy.
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For Immediate Release
January 2, 1997
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