If you’ve wondered why first-term House Majority Leader Denise Merrill of Mansfield wants to run for secretary of the state, consider the state’s budgetary free fall, a desc3ent driven by a massive dropoff in revenues. Why would anyone want to run for election to the General Assembly this year or next?
Here’s Comptroller Nancy Wyman’s release from earlier today about how the state deficit “improves slightly” to a whopping $513.3 million:
“State Comptroller Nancy Wyman today projected the state will end the
2010 fiscal year with a budget deficit of $513.3 million – a modest
improvement since last month.
The $36.2 million improvement in the deficit was due to a net increase
in revenues of $9.4 million and net spending reductions of $26.8
million, Wyman said.
The revenue jump was mainly attributed to $58.4 million tied to the
Treasurer’s sale of unclaimed property escheated to the state. That
offset a $39 million drop in receipts of the sales tax and a $10 million
drop in collection of the tax that corporations pay on profits.
Collections of the income tax are expected to end the year about $212
million below original estimates, driven by the loss of more than 88,000
jobs in Connecticut since the recession began in March 2008. Those job
losses are wiping out any revenue gain associated with the recent tax
rate hike for upper-income residents.
Wyman noted that the payroll tax accounts for about 65 percent of the
state’s total income tax receipts, which this year are expected to be
about $6.4 billion.
“Until the state stops losing jobs and the payroll taxes that go with
them, this deficit will continue to present difficult challenges for
policymakers,” Wyman said.
The $513.3 million deficit is based on a budget of $18.6 billion for
the fiscal year that ends June 30, 2010. The Governor’s budget office
is currently projecting a deficit of $327.9 million.”