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Budget deficit grows to $138.6 million, says Office of Fiscal Analysis

By Johanna Somers

Publication: theday.com

Published 01/25/2013 12:00 AM
Updated 01/25/2013 11:56 PM

Connecticut's fiscal year 2013 budget deficit has doubled, according to the nonpartisan Office of Fiscal Analysis. On Friday, the office reported that the state was short $138.6 million.

The new figure is more than twice the $64.4 million amount reported by Gov. Dannel P. Malloy's office on Tuesday.

Since the deficit mitigation bill in December, which eliminated a budget deficit of nearly $365 million, spending has increased and revenues have decreased, according to the OFA report.

On the spending side, a major change was in Medicaid expenditures. Estimated Medicaid spending is expected to increase by $88 million because of an increasing Medicaid low-income adult population. Budgeted savings won't be enough to offset that increase, the report said.

On the revenue side, a major loss was in sales and use tax revenue projections, which decreased by $116.1 million, or 2.9 percent.

The $138.6 million figure, while substantial, does not force the governor into another deficit-mitigation plan.

By law, the governor must provide a deficit-mitigation plan to the legislature when the deficit is greater than 1 percent of the general fund. The general fund makes up the largest part of the state's budget. For fiscal year 2013, the budget is $20.5 billion and the general fund is $19.1 billion.

The budget deficit would have to reach $191.4 million before the governor would have to submit a deficit-mitigation plan.

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