Gov. Malloy Revises Budget To Plug $2.5 Billion Deficit

May 15, 2017

Connecticut Governor Dannel Malloy released a revised two-year state budget that reduces aid to many municipalities by another $362 million in the first year while boosting aid to poorer communities.

Malloy says his new plan will cover a predicted $2.3 billion deficit in the fiscal year beginning July 1. That's a $600 million increase from the earlier projection.

The governor revised the two-year $40.6 billion budget he released in February after anticipated income tax revenues dropped sharply.

“This is a budget that is reflective of the current economic environment,” Malloy said.

The revised budget does not increase income taxes. But it does increase the real estate conveyance tax on properties valued above $800,000 and it eliminates the sales tax exemption for non-prescription drugs.

Malloy's plan still relies on $700 million in state employee concessions, which remain unsettled.

He and the state’s legislative leaders are expected to begin budget talks in the coming days.