spending

By Nathan Thomas at June 5, 2009 - 12:10pm
Policy News

Quantifying state budget troubles

Every state’s experience in this recession will be different, and it will be important for voters to put their states’ experience in proper context when evaluating their legislators and the budget choices they make. A new report (PDF) from the National Conference of State Legislatures seeks to quantify the challenges faced by state budget-writers, and the results are startling:

For April, which is the significant month for personal income tax collections, NCSL found that collections were more than 40 percent below the prior year’s level in Connecticut, Massachusetts and North Carolina, 43 percent in Michigan and 44 percent in Arizona.

“The fact that more than half the states reported breakdowns in all significant tax categories heightens alarm,” NCSL said.

With company profits down and recession-weary Americans buying less, revenues fell well below expectations in 38 states in 2009, the National Association of State Budget Officers and National Governors Association said in their latest joint report released June 4. NASBO Executive Director Scott D. Pattison said the revenues were below "even the most pessimistic forecasts.”

Writers at Stateline.org have compiled results from a similar report, by the National Governors Association, into an interactive graphic comparing revenue declines in different states for different types of taxes. It’s well-worth looking at for anyone interested in how their state’s budget troubles compare to others.

My home state of Louisiana, for instance, is facing major declines in sales, income, and corporate tax revenues, including the fourth-steepest income tax revenue decline in the country. Iowa, on the other hand, is likely to see a steep decline in corporate revenue partially offset by strong growth in sales tax revenue, with income taxes largely static.

By Nathan Thomas at May 11, 2009 - 1:19pm
Policy News

Tough road ahead for state governments

The 2009 legislative sessions have been painful for state legislators and their constituents across the country. With the recession decimating state tax revenues, most new state budgets will impose tax hikes and deep cuts to even the most essential government services. Throughout the process, Democrats and Republicans in many legislatures have set aside their traditional priorities and acted pragmatically to keep their governments from imploding.

But according to recent figures, 2010 could be far worse:

After already cutting $40 billion, states expect to have to slice another $62 billion to make their current budgets balance, the National Conference of State Legislatures said in its latest survey of states’ fiscal health, released April 23.

Four months ago, NCSL figured states would have to close shortfalls of $85 billion for fiscal 2010 budgets. Now that number has ballooned to $121 billion. Similarly, the National Governors Association has estimated budget gaps could top $230 billion through 2010.

In the face of all that red ink, legislative leaders are working hard to continue making wise investments and minimize the impact of their budget-balancing strategies. But since state governments generally cannot operate on deficit spending the way Congress can, states as Democratic as New York and as Republican as Idaho have made painful decisions to slash services and raise taxes.

If these new figures are accurate, voters around the country should brace for a new round of painful choices next year. But they should also remember that with the economy as bad as it is, these choices are often their legislators' only options.

By Matt Compton at March 3, 2009 - 7:14pm
Elections Analysis

Looking at campaign spending in Florida

In a year with an unprecedented amount of campaign spending, it should come as no surprise that legislative races are becoming more expensive.

Yesterday, the Florida Herald-Tribune looked at the amount of money spent by lawmakers in the state in 2008:

According to the Florida Division of Elections, the 316 candidates who ran for the 120 seats in the House spent a combined $29.7 million. The 50 candidates running for the larger Senate districts spent a combined $11.9 million.

The paper calculated that the average House race cost $94,000, while an average Senate race cost $238,000.