Connecticut budget deficit seen at $140 mln in 2013
Feb 1 (Reuters) - Connecticut will end fiscal 2013 with a budget deficit of $140 million, well above earlier projections, a top state budget official said on Friday.
Comptroller Kevin Lembo wrote in a letter to state governor Dannel Malloy that revenue projection had eroded by $33.9 million, while the weak economy meant the demands on social services were set to come in $75.6 million above what the Office of Policy Management had forecast.
The more pessimistic outlook comes just weeks after the Connecticut legislature approved a deficit mitigation plan. The plan, passed in December, combined with the spending cuts was intended to cover most of the $365 million deficit the Malloy administration was then projecting.
Like many other states, Connecticut is struggling to plug budget shortfalls after recession eroded revenue sources and placed a greater burden on social services.
"The slow growth in the national economy has created increasing demand for state services while at the same time producing lower revenue," Lembo said in statement. "Even after the national economy improves, there is a lag before state budget realizes the full benefit."
Lembo said, however, that there was still room for the projection to improve before the end of the fiscal year on June 30. He noted that only half of the general fund revenue was collected as of the December.
The state's financial year started on July 1, 2012, and the overall budget is about $20 billion. Malloy, a Democrat, is scheduled to present the new budget on Feb. 6.
Malloy said recently that the state could borrow up to $1.8 billion in 2013 to fund infrastructure projects, including school security upgrades after the deadly December shooting at Sandy Hook Elementary School in Newtown, Connecticut.