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Connecticut deficit may hit $192 mln in fiscal 2012
July 2, 2012 / 3:43 PM / 5 years ago

Connecticut deficit may hit $192 mln in fiscal 2012

July 2 (Reuters) - Connecticut’s deficit for fiscal 2012 likely will rise to $192 million, as revenue from income taxes on capital gains and Wall Street bonuses were below expectations, the state comptroller said in a statement on Monday.

The deficit for the fiscal year that ended on June 30, which was estimated at $142 million in April, mainly will be closed with general fund reserves from previous years, comptroller Kevin Lembo said.

“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,” Lembo said.

Estimated income tax payments, which reflect capital gains and bonus payments, only rose 5.9 percent, while withholding income tax payments climbed 18.3 percent.

Connecticut’s recovery from the recession “has not reached normal levels,” Lembo said, though he said new home sales in the Northeast are one of a few positive economic factors.

Housing permits in Connecticut in April were 6.4 percent higher than a year earlier.

Still, the state has won back less than one-third of the jobs lost in the recession.

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