Update on State Budget Shortfalls

The National Association of State Budget Officers (NASBO) last month released an update on the state fiscal situation (PDF). Some highlights:

• All state FY 2010 enacted budgets, added up, are 5.4% lower than the previous year, which itself was a 3.4% decline than the year before that. These are the first declines since 1983.
• After enactment of FY 2010 state budgets, $108.7 billion in gaps opened, of which $18.9 billion were outstanding. The $89.8 billion in closing was made up of $23.9 billion in increased taxes and fees, $7.7 billion in gimmicky revenue changes (deferring tax cuts, raiding funds, amnesties), and at least $55.7 billion in reductions in planned spending.
• Budget gaps estimated for FY 2011 stand at $55.4 billion; for FY 2012, $61.8 billion.
• 41 states have seen revenue come in lower than they had projected for FY 2010.
• 24 states have cut their desired spending for FY 2010 by more than 5 percent.
• In January 2010, state governments eliminated 18,000 jobs.

More on state budgets and taxes here.