State Comptroller Nancy Wyman today issued a preliminary projection of a $19.9 million year-end budget surplus for fiscal year 1999, cautioning that it is still too early to gauge the long-term effects of an apparent economic slowdown.

The state ended the 1998 fiscal year on June 30 with a surplus of $312.9 million. The $19.9 million surplus projected for 1999 is based on estimates included in the legislature's current budget plan.

Wyman questioned the credibility of the Governor's recent prediction of a $117.4 million for 1999, saying that there is insufficient data available to make such an optimistic forecast.

"There are already signs that economic growth in the next year will be slower than last year," Wyman said. "Therefore, I believe there is little reason at this time to deviate from the projections in the current budget. I think the Governor's numbers are based more on political hope than economic reality."

The major reasons for Wyman's concerns about a drop in economic growth are:
• Consumer spending, which accounts for two-thirds of all economic activity in the state, fell in July for the first time in two years.

• Heavy losses in the stock market by state residents could have a significant impact on the state economy, due to possible declines in disposable income and consumer confidence, as well as diminished revenues from capital gains.

• With Connecticut now running close to full employment and with virtually no growth in the total labor force in the last three years, last year's exceptional growth in employment cannot be repeated.

For Immediate Release
September 1, 1998

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

Back to Comptroller's Home Page
Back to Index of Comptroller's Press Releases