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State Budget Update:M h 2010March 2010
Fiscal Affairs Program
OverviewThe steep drop in state revenues appears to be p p ppsubsiding.
Despite revenue improvement, many states face sizeable budget gaps.
To date, states have reported a total estimated budget gap of $531.4 billion (FY 2008 through FY 2013).
FY 2010 P l I T C ll i *FY 2010 Personal Income Tax Collections*
Above Target 5Above Target, 5(0 , 1 )No personal
income tax, 8
On Target, 11(9 , 1 )
Below Target, 25Below Target, 25(11 , 2 )
*Compared to the latest Estimateforecast increased; forecast reduced
Arizona and New York did not provide this information. Source: NCSL survey of state legislative fiscal offices, March 2010.
FY 2010 G l S l T C ll i *FY 2010 General Sales Tax Collections*
No generalAbove Target, 7
(1 , 1 )
No general sales tax, 5
On Target, 12(6 , 3 )
Below Target, 24(10 , 1 )( , )
*Compared to the latest Estimate. forecast increased; forecast reduced
Arizona, New York and South Dakota did not provide this information. Source: NCSL survey of state legislative fiscal offices, March 2010.
FY 2010 C I T C ll i *FY 2010 Corporate Income Tax Collections*
No corporate
Above Target, 11(1 , 4 )
income tax, 4
Below Target, 18
On Target, 15(3 , 7 )
g ,(9 , 1 )
( , )
*Compared to the latest Estimate ; forecast increased; forecast reduced
Arizona, New York and South Dakota did not provide this information. Source: NCSL survey of state legislative fiscal offices, March 2010.
FY 2010 O h T C ll i *FY 2010 Other Tax Collections*
Above Target, 8(1 , 0 )
No response, p22
On Target, 12(4 , 5 )( , )
Below Target, 9Below Target, 9(5 , 1 )
*Compared to the latest Estimateforecast increased; forecast reduced
Source: NCSL survey of state legislative fiscal offices, March 2010.
Projected FY 2010 Revenues Compared toAK
Projected FY 2010 Revenues Compared to FY 2009 Collections
OR
WA
ID
MT ND
MN
WINY
ME
VTNH
MA
RI
HI
CA
ID
NV
WY
UTCO
SD
NE
KS
IA
MI
ILIN OH
VAWV
PA
RI
CT
NJ
DE
MDCA CO
AZNM
KS
OK
MO
AR
KY
MS AL GA
SC
NC
MD
TN
TX LA
MS AL
FL
Higher n = 9
Flat n = 1
Lower n = 40Puerto Rico
Source: NCSL survey of state legislative fiscal offices, 2009.
Unknown n = 1
P j d FY 2011 R C dAK
Projected FY 2011 Revenues Compared to FY 2010 Collections
OR
WA
ID
MT ND
MN
WIMI
NY
ME
VT
NH
MA
RI
HI
CA
ID
NV
WY
UTCO
SD
NE
KS
IA
MI
IL IN
OH
VAWV
PA
RI
CT
NJ
DE
MD CA CO
AZ NM
KS
OK
MO
AR
KY
TN
MS AL GA
SC
NC
MD
TX LA
MS AL
FL
Puerto Rico
Higher n = 42
Flat n = 4
Lower n = 5
Source: NCSL survey of state legislative fiscal offices, March 2010
Unknown n = 0
l kAK
NH
State Revenue Outlook for FY 2011
OR
WA
ID
MT ND
MN
WIMI
NY
MEVT
NH
MA
RI
HI
CA
ID
NV
WY
UTCO
SD
NEIA
MI
IL IN
OH
VAWV
PA
RI
CT
NJ
DE
MD CA CO
AZ NM
KS
OK
MO
AR
KY
TN
MS AL GA
SC
NC
MD
TX LA
MS AL
FL
Puerto Rico
Stable n = 14
Concerned n = 34
Pessimistic n = 3
O i i i 0
Source: NCSL survey of state legislative fiscal offices, March 2010
Optimistic n = 0
AK Pre-Enactment FY 2011 Budget Gapsas a Percentage of General Fund Budget
OR
ID
MT10.8%
WA8.3%
ND
MN25.5% WI
MI
NY15 3%
ME21.6%VT, 22.0%
NH 8.3%
MA, 40.8%
RI 15 1%
HI22.7%
CA
ID
NV45 0%
WY
UT15.8% CO
SD
NE4.7%
KS
IA19.6%
MI13.0%
IL45.0% IN
9.0%
OH2.2%
VA13 9%
WV5.0%
PA
15.3% RI, 15.1%
CT, 4.1%
NJ, 33.0%
DE, 9.6%
MD, 17.2%CA13.4%
45.0% 5
AZ30.0%
CO6.1%
NM6.0%
KS8.7%
OK15.4%
MO
AR
KY, 4.5%
TN, 13.1%
MS AL GA
SC11.1%
NC7.2%
13.9% MD, 17.2%
TX10.6%
LA11.1%
MS AL
FL10.0%
6.9%
10% to 19.9%, n = 16
5% to 9.9%, n = 10
0.1% to 4.9%, n = 4 Puerto Rico, 11.1%
More than 20% n= 9Not applicable or not reporting, n = 12
Source: NCSL survey of state legislative fiscal offices, March 2010.
AK Pre-Enactment FY 2012 Budget Gapsas a Percentage of General Fund Budget
OR13.4%
WA
ID
MT10.8%
ND
MN19.5% WI
MI
NY21 4%
MEVT, 8.0%
NH
MA
RI 11 1%
HI30.7%
CA
ID8.3%
NV
WY
UTCO
SD
NE8.7%
KS
IA14.5%
8.3% MI
ILIN
OH
VA14 4%
WV
PA
21.4% RI, 11.1%
CT, 20.1%
NJ
DE
MD, 15.1%CA20.1%
CO5.2%
AZ12.5%
NM4.8%
KS10.6%
OK
MO
AR
KY, 8.3%
TN, 0.4%
MS AL GA
SC25.9%
NC10.2%
14.4% MD, 15.1%
0 1% t 4 9% 2
TX12.4%
LA22.3%
MS AL
FL
13.0%
Puerto Rico, 5.5%10% to 19.9%, n = 13
5% to 9.9%, n = 7
0.1% to 4.9%, n = 2
More than 20% n= 6G i i d b k 4
Source: NCSL survey of state legislative fiscal offices, March 2010.
Not applicable or not reporting, n = 19
Gap anticipated but amount unknown, n = 4
AK Pre-Enactment FY 2013 Budget Gapsas a Percentage of General Fund Budget
OR13.4%
WA
ID
MT9.2%
ND
MN10.2% WI
MI
NY25 2%
MEVT, 6.0%
NH
MA
RI 12 3%OR13 4%
HI35.9%
CA
ID
NV
WY
UTCO
SD
NE8.7%
KS
IA
8.4% MI
ILIN
OH
VAWV
PA
25.2% RI, 12.3%
CT, 18.8%
NJ
DE
MD, 13.2%
13.4%
CA20.1%
CO
AZ6.7%
NM
KS
OK
MO
AR
KY
TN, 0.2%
MS AL GA
SC27.2%
NC
MD, 13.2%
0 1% to 4 9% n 1
TX12.4%
LA21.9%
MS AL
FL
Puerto Rico, 10% to 19.9%, n = 5
5% to 9.9%, n = 5
0.1% to 4.9%, n = 1
More than 20% n= 6G i i d b k 4
Source: NCSL survey of state legislative fiscal offices, March 2010.
Not applicable or not reporting, n = 30Gap anticipated but amount unknown, n = 4
St t B d t G FY 2002 FY 2013 ( j d)
$170$180$190
$174.1
State Budget Gaps FY 2002-FY 2013 (projected)
Amount Before Budget Adoption
$28.2
$110$120$130$140$150$160
rs
$117.3
Amount After Fiscal Year Began
Projected Amount
$145.9$29.9
$5.3
$
$77.0
$50$60$70$80$90
$100$110
ions
of D
olla
r
$79.0
$83.7
$37.0
$49.1$78.4
$36.3 $26.9$40.3
$89.0$73.5 $64.7
$37.2
$0.7
$12.8$0$10$20$30$40$50
Bill
i
No estimate
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Fiscal Year43 states 45 states 42 states 33 states 26 states 1 state 20 states* 44 states* 49 states* 39 states* 28 states** 17 states***
* Includes Puerto Rico ** 31 states and Puerto Rico forecast FY 2012 gaps. The amount shown for FY 2011 indicates the 28 states that provided gap amounts. *** 21 states forecast FY 2013 gaps. The amount shown for the FY 2012 indicates the 16 states that provided gap estimates.
Source: NCSL survey of state legislative fiscal offices, various years.
Budget Gap NumbersBudget Gap NumbersPast and Current Recession
Past Recession Current RecessionPast Recession Current Recession
Fiscal Year Amount(in Billions)
Fiscal Year Amount(in Billions)
2002 $37 2 2008 $12 82002 $37.2 2008 $12.8
2003 $79.0 2009 $117.3
2004 $83.7 2010 $174.1*
2005 $37.0 2011 $89.0**
2006 $26.9 2012 $73.5**
2013 $64.7**
Total $263.8 Total $531.4*Past Recession: March 2001 to November 2001 (8 months)Current Recession: Began December 2007 to Q3 of 2009? (20-21 months)Great Depression August 1929 to March 1933 (43 months)
b d d d d fGray bar denotes end/projected end of recession*Preliminary figure** Projected figure
Source: NCSL survey of state legislative fiscal offices, various years.
A f S di Si ifi l OArea of Spending Significantly Over Budget in FY 2010g
28 states reported spending overruns
Medicaid: 21 states and PR
Other social services: CT, KS, MD, MT, NH, OR, NJ, VT, WA
Prisons/public safety: LA, MD, SC, TX, VT, WA
K-12 education: LA, MD, WA
Source: NCSL survey of state legislative fiscal offices, March 2010.
A i Add L f ARRAActions to Address Loss of ARRA Fundingg
Fewer than half the states have taken action
Lowered spending base: 12 states
Raised revenue: FL, NM, UT, WA, VA
Tagged money as one-time with no plans to replace it: AR, MO, ND, TX
Focusing on streamlining/efficiencies: LA, ME, WV, VT (Challenge for Change Initiative)
Source: NCSL survey of state legislative fiscal offices, March 2010.
A i Add L f ARRAActions to Address Loss of ARRA Funding (cont.)g
Used one-time money: IA, SC, UT
Extending funding period for pension contribution: AL (pending), VA
Established commission on highway funding: NH
Proposed stimulus reserve fund: PA
Assumes Congressional action: IL
Hiring and salary freeze: TN
Source: NCSL survey of state legislative fiscal offices, March 2010.
A i Add L f ARRAActions to Address Loss of ARRA Funding (cont.)g
Created public-private partnership: PR
Exploring ideas: KS, OH
No actions to date: 9 states
No response: 6 states
Budget still under deliberation: 4 statesg
Source: NCSL survey of state legislative fiscal offices, March 2010.
Conclusion
Revenue forecasts are starting to show year-over-year hgrowth.
Many forecasts offer little room for error.
Many states face at least two more years of budget gaps.
Few states have concrete plans to address the end of ARRA funding.
www.ncsl.orgFor more informationFor more information