WYMAN SAYS DEFICIT DROPS BELOW $1 BILLION

According to State Comptroller Nancy Wyman,  a rise in income tax collections combined with concessions by state employees and a deficit-mitigation plan enacted by the General Assembly have reduced the projected 2009 budget deficit to $914 million.

It is the first time since February that the estimated deficit dipped below $1 billion.

“While it is encouraging that the deficit is moving in the right direction, there is much work to be done to put Connecticut back on the road to fiscal stability,” Wyman said.

Receipts of the income tax rose 1 percent in April, after declining an average of 8 percent in the first three months of the calendar year. The increase came despite the loss of nearly 12,000 jobs in April, bringing total job losses for the fiscal year to 65,000.

Wyman said the income tax improvement in April may be at least partly due to a quirk in the timing of some income tax payments when comparing this fiscal year to last.

Also cutting into the deficit since last month is:

• $75 million in concessions made by state employees – mainly by deferring the state’s required contributions into the funds that pay for retirees’ pensions and medical benefits.

• $153.8 million in deficit-mitigation steps taken by the General Assembly.

Wyman’s deficit estimate is $100 million higher than that of the governor’s budget office, due to the Comptroller’s less-optimistic forecast of income tax and sales tax receipts.