State Comptroller Nancy Wyman today projected that the state will end the 1997-98 fiscal year with a surplus of $225 million, and called for some of the money to be returned to taxpayers in rebate checks.

Wyman's surplus estimate is nearly $100 million above what she had projected in her three previous monthly reports on the state budget. She said the rising surplus is being driven by extraordinarily high collections of the state income tax - based on robust growth in jobs and personal earnings - and the strong national and state economies.

Total income tax revenues for the year are expected to reach $3.4 billion; about $300 million more than originally anticipated.

Wyman recently proposed a plan to use a portion of the surplus to give taxpayers a rebate check, fill the state's emergency Rainy Day Fund and pay down the state's $9.2 billion debt. She said her plan would create a permanent tax relief system that is tied directly to the performance of state government, and is more stable than yearly tinkering with tax rates.

"These new surplus estimates would allow my rebate plan to provide meaningful tax relief for individuals and give the state some long-term financial stability," Wyman said. "My plan also would ensure that today's tax cuts are not tomorrow's tax increases."

State law calls for any surplus to be used first to fill the Rainy Day fund, which is now about $130 million short of its targeted level of $450 million. In the first year of Wyman's plan, individual rebates would be paid from the surplus remaining after the Rainy Day Fund is filled.

Under the current surplus estimates, Wyman's plan would provide a check of approximately $100 to each of the state's taxpayers this year, to be spent however they choose. In subsequent years, rebates would be distributed from 90 percent of the surplus, with the other 10 percent going to reduce state debt.

"When a corporation finishes the year with a profit, it pays its shareholders a dividend," Wyman said. "The taxpayers who pay the bill for running our state government deserve nothing less."

Learn more about the Connecticut Comptroller's Office by calling up our Internet Home Page, at the link below.

For Immediate Release
January 29, 1998

Back to Comptroller's Home Page
Back to Index of Comptroller's Press Releases
To Monthly Letter to the Governor dated January 29, 1998