Connecticut officials are now projecting that the state will end this fiscal year with a $23 million surplus, as stated in a letter sent by Governor Dannel Malloy’s budget director to the state comptroller on Friday.
The letter from Office of Policy and Management Director Ben Barnes says this represents a $65 million turnaround from the deficit his office had been projecting just a month ago.
He credits this to an $80 million increase in corporation tax because of strong collections over the past few months. Barnes says the general fund has also benefited from the state's recent $31.5 million share of a nationwide settlement with Moody's credit rating agency.
However, Barnes says revenues from the state sales tax continue to underperform and projected income tax revenues have been revised downward.
The state is still facing a projected $1.5 billion budget shortfall for the next fiscal year that ends on June 30, 2018.