U.S. Governors Report: Decline In Fiscal Conditions
National Governors Association Reports State Fiscal Conditions Continue to Decline
Posted by: Robert W. Price
Shortfall Expected to Be More than $200 Billion Over Next 3 Years
The National Governors Association–the bipartisan organization of the nation’s governors–promotes visionary state leadership, shares best practices and speaks with a unified voice on national policy.
Although federal Recovery Act dollars have helped states avoid the most drastic budget cuts, state fiscal conditions declined for nearly every state during fiscal year (FY) 2009, according to the latest Fiscal Survey of the States from NGA and the ational Association of State Budget Officers (NASBO).
The two organizations announced the results of the biannual survey at a press conference June 4. Overall, NGA and NASBO found that while general fund expenditures and revenue collections increased for many states in FY 2008, the ongoing recession is adversely affecting states’ fiscal outlook for the next several years.
In FY 2009, about half of states experienced negative budget growth, and nearly three-quarters are recommending 2010 budgets with negative growth. Additionally in 2009, state general fund expenditures declined 2.2 percent—the first decline in actual state general fund spending since 1983 and revenue collections were down 6.1 percent, with 30 states failing to meet projections.
Throughout 2009, 42 states were forced to reduce previously enacted budgets by $31.6 billion. Between FY 2009 and 2011, states must fill more than $183.3 billion in budget gaps, after previously closing gaps totaling $46.2 billion.
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