Connecticut’s deficit is growing faster than expected.
Comptroller Kevin Lembo projects a $192 million deficit for the fiscal year of 2012, which ended on June 30. Previous projections in April had the deficit at only $142 million.
“The economy is the largest single influence on the state budget – dwarfing any other budget drivers,” Lembo said in a statement. “Wall Street’s erratic equity markets and challenges in the financial sector – which had the largest private-sector job loss in the state – is the driving force behind this deficit.”
State income tax levels are as predicted, with a 18.3 percent increase from the 2011 fiscal year. However, taxes from capital gains and bonuses grew only 5.9 percent.
Another problem is that state spending missed its mark by running $22.5 million higher than expected. The deficit will likely be closed using reserve money, said Lembo.