Malloy, Lembo see state budget through very different lenses
HARTFORD — For the first time since they took office 14 months ago, Comptroller Kevin P. Lembo and Gov. Dannel P. Malloy don't see eye-to-eye when it comes to state finances.
The governor's budget office says the state is on pace to finish with a $35.9 million surplus.
Both agencies had agreed on a $1.4 million surplus projection one month ago.
Why does Lembo see the fiscal outlook getting worse when his fellow Democrat, Malloy, still reports Connecticut's finances in the black?
State tax data show the new earned income tax credit is generating refunds that are about 20 percent above the level built into the state budget. "If this refund experience continues through the remainder of the fiscal year," Lembo wrote, "refunds will exceed budget expectations by $22 million."
Lembo also declined to accept a new administration estimate that cost-cutting efforts would save another $34.5 million before the fiscal year ends June 30. Over the past four fiscal years, nearly 60 percent of the general fund has been expended through January, the comptroller wrote. "If this trend continues into Fiscal Year 2012, the additional [savings] will be difficult to realize," Lembo wrote.
The comptroller also warned that "spending pressures to support state services are growing." Between December and January, spending from the "other expenses" accounts — a line item covering a multitude of contractual, equipment and other miscellaneous costs in most agencies — grew by more than 20 percent. "Based on these trends, caution prohibits the inclusion of the additional [savings] into my estimate," he added.
Malloy's budget chief, Office of Policy & Management Secretary Benjamin Barnes, said February 29 that "I think our projections are remarkably close.” Both agency forecasts represent less than one-quarter of one percent of the general fund. At order valium.7 billion, the general fund covers the bulk of the operating costs in this fiscal year's overall $20.14 billion budget.
Barnes also noted that the $34.5 million in cost-cutting efforts in his projection stem from emergency budget cuts Malloy ordered more than one month ago. "I don't have any reason to believe we won't fully achieve that," Barnes said.
This article originally appeared in CTMirror.com.
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