Comptroller Natalie Braswell today, in her monthly financial and economic update, projected a General Fund surplus of $1.76 billion for Fiscal Year 2022 while offering guidance to policymakers during ongoing budget negotiations.
The surplus projection increased $245 million since last month. The improvement is attributable to a combination of revenue growth in certain tax categories and lower-than-anticipated spending. Braswell’s projection is slightly lower than the one issued by the Office of Policy and Management earlier this month because of legislation that will offer temporary tax relief and free bus service to Connecticut residents.
“I commend Governor Lamont and the legislature for their collaborative actions to help working families,” said Braswell. “As our state’s economy continues to improve, we must balance our long-term objectives with the immediate needs of Connecticut residents. These measures, while temporary, will assist in combatting the effects of inflation and the economic ramifications of war overseas.”
Braswell condemned the Russian invasion of Ukraine, which is creating a humanitarian crisis abroad and contributing to economic volatility for American families. Prices for food and energy are particularly unstable, representing key exports for each nation. That volatility also extends to the stock market, which is a key driver of Connecticut’s budgetary position.
Connecticut added an estimated 6,300 jobs last month and has now recovered over 80% of the jobs lost during the onset of the pandemic. The state’s Gross Domestic Product (GDP) grew by 7.7% in the fourth quarter of 2021, the 12th highest in the nation and exceeding both the regional and national averages.
“Connecticut’s positive economic position presents a great opportunity for everyone in our state to share in the benefits of this recovery,” said Braswell. “We have a rare chance to correct some of the long-standing inequities in our economy and bring lasting, transformative relief to working people. By making key investments in our residents and our infrastructure, we can grow the middle class and carry this momentum long into the future. But I also want to caution policymakers to not jeopardize the progress we’ve made by undoing the sound fiscal policies that have filled the Rainy Day Fund and allowed us to finally reckon with the albatross of pension debt.”
In a letter to Governor Ned Lamont, Braswell noted that, in addition to the substantial surplus, she is also projecting another large transfer into the state’s Budget Reserve Fund (“Rainy Day Fund”) due to excess revenue in certain volatile categories. Because the fund has reached its statutory cap, an estimated $2.6 billion will be available to pay down debt, including the state’s pension liabilities.Download as PDF Current News