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Malloy reports microscopic surplus, emergency budget cuts likely next week

The Connecticut Mirror | by Keith M. Phaneuf | January 21, 2012

The state's budget isn't drowning, but its fiscal nose is above water by such a small fraction -- 1/134th of 1 percent -- it's almost impossible to see.

The latest monthly report from Gov. Dannel P. Malloy's administration, released late Friday afternoon, projects a $1.4 million surplus, with the $88 million cushion originally built into the budget all but vanished.

Also Friday, Malloy's budget chief warned that the governor likely would exercise his unilateral authority to cut spending without legislative approval later this month.

The new General Fund surplus also falls well short of the $75 million surplus level Malloy needs to continue the ongoing conversion of state finances to Generally Accepted Accounting Principles -- one of the governor's largest campaign pledges. The General Fund, which stands this year at $18.7 billion, covers the bulk of the operating costs in this fiscal year's overall $20.14 billion budget.

The latest budget forecast, which now heads to Comptroller Kevin P. Lembo's office for review, is down from the $83.7 million surplus that the administration projected on Dec. 20, and that Lembo confirmed on Jan. 1.

The reduction was anticipated after fiscal analysts for the executive and legislative branches agreed on a consensus revenue report late Tuesday that showed revenues from the income tax and other sources coming in below budgeted levels.

 

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