Many States Fall in Fiscal Free Fall [View All]

[VermontDem2004]

HARRISBURG, Pa., Aug. 13 — Lately, California’s budget and political crises have stolen the news headlines. However, plenty of the 49 remaining states in the union are facing fiscal woes of their own.

CALIFORNIA MAY BE the worst budget basket case, but it’s not the only one in fiscal free fall. Here in the Keystone State, and in many other states from coast to coast, governors and state legislatures are dog-paddling in a sea of red ink.
Nationwide, states battled shortfalls totaling $60 billion. Unlike the federal government, deficit spending is not an option for states.
“The biggest difference between state budgeting and the federal budget process is that states must balance their budgets,” said Michael Mazerov of the Center for Budget and Policy Priorities.
And they had to pull out all the stops in order to do it.
“On paper, the budgets of virtually all states are balanced for the fiscal ’04 year that just started,” Mazerov said. “However, many of the budget-balancing goals were achieved through one-time measures that will leave many states in just as much fiscal difficulty when it comes time to adopt a budget a year from now.”
To make ends meet, 31 states cut spending:
23 states laid off workers or cut their pay.
15 states increased taxes more than one percent.
13 states tapped rainy-day funds.
11 states delayed capital spending projects.
And 4 states expanded gambling.

http://www.msnbc.com/news/951979.asp?vts=81420030544