STATE OF CONNECTICUT
THE STATE COMPTROLLER
|WYMAN PROJECTS $174.9 MILLION SURPLUS
Comptroller Warns that Spending Cap in Jeopardy Again
|Contact: Steve Jensen|
State Comptroller Nancy Wyman today projected that the state will end the 2001 fiscal year with a budget surplus of $174.9 million.
But Wyman also cautioned that if current estimates hold, the state's constitutional cap on spending will be exceeded for the fourth year in a row. The main item that endangers the cap is in the Department of Social Services, which is currently estimated to spend $131.7 million over its original budget.
"There is clearly a problem with financial management when the normal, day-to-day operating expenses of the state threaten to exceed the spending cap just a few months into the new fiscal year," Wyman said. "This situation is evidence of the need for more realistic budgeting and for the state to implement better tools to track spending."
For fiscal year 2001, the cap allows for 5.48 percent budget growth. The 2001 budget, as passed by the legislature and signed by the Governor, is $50.9 million below the cap. However, the cap is based on net appropriations, which include anticipated savings.
To keep net appropriations $50.9 million below the cap, every state agency would have to stay within its budget and $120 million in savings would have to be achieved, Wyman said. But if current overall budget projections hold to year's end, net appropriations will be $76.8 million over the cap at the end of the 2001 fiscal year.
In the last three years, a three-fifths vote of the legislature was required to exceed the spending cap because the overspending was covered by legislative appropriation of additional funds.
Under the current scenario, no legislative approval would be needed because the cap would be broken not by additional appropriations, but by failure to achieve the budgeted $120 million in savings. About $68 million of the budgeted savings has been earmarked to cover the agency overspending.
"To allow the spending cap to be broken without any legislative approval clearly shows that the system is flawed and can be manipulated by budget gimmicks," Wyman said.
Despite the agency overspending, the $174.9 million surplus will be achieved due to revenues which are expected to exceed estimates by $304.9 million.
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 - email@example.com
Learn more about the Connecticut Comptroller's Office by calling up our Internet Home Page, at the link below.
For Immediate Release
October 2, 2000
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