|WYMAN SAYS STATE WILL END FISCAL YEAR WITH $52.9 MILLION UNAPPROPRIATED SURPLUS,WARNS OF OVERSPENDING|
|Contact: Steve Jensen|
The General Assembly's appropriation of more than $590 million of the year-end budget surplus has reduced the remaining projected surplus to $52.9 million, State Comptroller Nancy Wyman said today.
The legislature voted to spend most of the surplus when it approved the state budget last month. Expenditure of the surplus funds will push total state spending this fiscal year to about $527.7 million above the constitutional spending cap. Last year, the cap was exceeded by $194.1 million.
"This high level of spending is only possible because of the enormous revenues being brought in by the income tax," Wyman said, noting that income tax receipts are expected to total $427.8 million more than was originally anticipated. "But it is clear that this pattern of overspending by state government cannot possibly be sustained when the economy inevitably cools down."
Wyman also expressed concern that appropriating most of the surplus left only $22.4 million to be put toward the state's bonded debt of about $9.3 billion - the highest per-capita debt in the nation.
The $22.4 million bonded debt payment represents 3.5 percent of the surplus. Another $55 million, or 8.5 percent of the surplus, will be applied to reduce the amount of bonding need for school construction projects, which can be construed as a form of debt reduction.
Another $96.2 million of the surplus will be used to issue sales-tax rebates to taxpayers.
The General Assembly's appropriation from the surplus contained $438.8 million in spending initiatives, including:
* $90 million to cover an extra state payroll period next year
* $80 million for redevelopment projects in Hartford
* $78 million to cover certain Medicaid expenses over the next biennium
* $60 million to pay outstanding liabilities in the state employees health account
* $20.2 million for various legal settlements
* $20 million for local capital improvement projects
* $15 million in Year 2000 computer-conversion costs
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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For Immediate Release
July 1, 1999
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