Bob Williams State Budget Shortfall - Bob's Corner

state budget shortfall-February 8, 2010

Rather than taking the necessary action and reducing state budgets to the estimated revenue forecast last year, most states used one-time federal stimulus money, accounting gimmicks and raided non-general funds in order to balance their state budgets.  Last year we predicted that most states will face multi-billion dollar deficits in the 2010-11 budgets because of this short term thinking.

I had an article in the ALEC newsletter discussing how states can balance their budgets without raising taxes.  http://www.alec.org/am/pdf/InsideALEC/InsideALECApril2009.pdf

Legislators of both parties allow bureaucrats to report a budget shortfall as the difference between what the governor wants to spend (not the current budget) vs the revenue forecast.  We have not found any state that reports a shortfall as the difference between the current level of spending and the revenue forecast.  Thus, most shortfalls are highly inflated.

The Center on Budget & Policy Priorities. (they have a very liberal bent) sees 2010 as the worse year of this century for state budget shortfalls and they don’t expect conditions to improve fast. They predict state budget shortfalls are likely to reach a whopping $180 billion for the coming fiscal year. Center on Budget and Policy Priorities. December 23, 2009.

Alabama-$600 million state budget shortfall for the 2011 budget.  MyFoxAl.com. December 15, 2009.

Alaska-$1.3 billion state budget shortfall Center on Budget Priorities December 23, 2009

Arizona-Gov. Brewer says state faces a $5 billion state budget shortfall over the next year and a half and calls for a sales tax increase to help solve the problem.  Phoenix Business Journal.  January 11, 2010.

-State can fix mess with spending discipline –Tom Patterson former State Senator. East Valley Tribune.com December 27, 2009.

California –Gov.Schwarzeegger request $6.9 billion to help solve California’s state budget shortfall. The Epoch Times. January 10, 2010

Gov. Schwarzenegger submits ‘draconian’ California Budget to close a $19.9 billion state budget shortfall.  Reuters. January 8, 2010

-State to sell 17 state buildings to help solve their state budget shortfall.  Firm headed by Diane Feinstein’s husband will handle the sale! SquareFeetblog.com/commercial-real-estate-blog.  December 11, 2009.

Colorado-$1.7 billion state budget shortfall this fiscal year and a $1.5 billion shortfall next year.  Coloradoan.com January 8, 2010.

Connecticut-Gov. Rell vetoed the legislature’s deficit mitigation plan, leaving the state with a state budget shortfall between $250 million and $500 million. Journal Inquirer. December 29, 2009

Delaware-$278 to $342 million state budget shortfall.  Do Delaware online. January 10, 2010

Florida- Gov. Crist calls for $2.7 billion in new spending despite the fact that the state has a $3.2 billion state budget shortfall. Opinion.Jacksonville.com. February 6, 2010

Georgia- State budget shortfall of  nearly $1.5 billion. AJC.com. January 12, 2010

Hawaii-$1.2 billion state budget shortfall. Los Angeles Times. January 2, 2010

Idaho-Gov. Otter states “we must live within our means” in his state-of-state address.  Idaho-Statesman.com. January 12, 2010

-$52 million state budget shortfall in the current fiscal year ending June 30, 2010.
Times-News Magic Valley.com.  January 1, 2010.

Indiana –$1.8 billion state budget shortfall. IDNonline.  January 19, 2010

Illinois - $12.8 billion state budget shortfall for the next fiscal year. Chicago Sun-Times. January 16, 2010

Iowa-$1 billion state budget shortfall for FY 2010-11.  Chicago Tribune.  January 4, 2010.

Kansas- Gov. Parkinson is asking for a tax increase to address a $400 million state budget shortfall in the next fiscal year.  Kansas City Business Journal. January 12, 2010

Kentucky -state budget shortfall of $1.5 billion over the next two years.  Courier-journal.com. January 5, 2010

Louisiana- state budget shortfall of $1 billion for the 2010-11 fiscal year and at least a billion dollars more next year when the federal stimulus money stops.  Dailycomet.com. January 24, 2010

Maine- state budget shortfall of $438 million.  Bangor Daily News.  January 2, 2010.

Maryland –$2 billion state budget shortfall.  Washington Examiner. January 10, 2010

Massachusetts-Governor releases plan to solve State budget shortfall of $2.7 billion in fiscal 2011. myhomeless.wordpress. January 27,2010.

Michigan- $1.6 billion state budget shortfall. The Detroit News. January 12, 2010

Minnesota- $1.2 billion State budget shortfall for 2010-11 budget and another $5.4 billion for the 2011-12 budget.  Chaska Herald.  December 10, 2009

Mississippi-$715 million state budget shortfall for fiscal year 2011 and another $500 million in FY 2012.  Jacksonfreepress.com. November 25, 2009.

Missouri-State budget shortfall has been reduced to $261 million this year and an estimated $400 million next year.  January 23, 2009.

Nevada-   -$900 million state budget shortfall for 2010-22.  13 Action News.  January 25, 2010.

New Hampshire –Fiscal committee defeats $80 million transfer from rainy day fund to help close state budget shortfall. New Hampshire Watchdog.org. January 8, 2010.

-state budget shortfall of up to $306 million for the 2010-11 budget.  Nashua Telegraph. December 18, 2009

New Jersey- $1.2 billion state budget shortfall. Daily Record.com  January 20, 2010

New Mexico- $600 million state budget shortfall. CNJonline.com  January 16, 2010

New York – $600 million state budget shortfall in current fiscal year and up to $9 billion state budget shortfall for 10-11 fiscal year. Politics on the Hudson.  December 31, 2009

North Carolina – $4.4 billion state budget shortfall for FY2010 .  Center for Budget Priorities.

-NC has reached its self-imposed debt limit, but has borrowed $1.7 billion to pay unemployment benefits, and expects Medicaid spending to be $250 million over budget.  John Locke Foundation.  February 3, 2010.  http://www.johnlocke.org/lockerroom/lockerroom.html?id=23388

Oklahoma-$750 million state budget shortfall for this fiscal year ending June 30, 2010.  NewsOn6.com

Ohio-Gov. Strickland sings new state budget that fills a $851 million state budget shortfall by delaying this year’s 4.2 percent income tax cut. The Columbus Dispatch. December 22, 2009

Oregon- Oregon voters approve two tax measures which raises $727 million in taxes on corporations and the wealthy to eliminate state budget shortfall. The Oregonian January 26, 2010

Pennsylvania -    $3 billion state budget shortfall.  The Mercury.  January 1, 2010

Rhode Island –Nearly $219 million state budget shortfall this fiscal year.  Governor proposes to cut $1.1million from town and schools.  EastBayRI.com December 16, 2009.

South Carolina –$560 million state budget shortfall in the current budget; $1.3 billion shortfall for the 2011-12 budget and a $1.4 billion shortfall in 2012-13. GreenvilleOnline.com. January 8, 2010.

South Dakota-$32 million state budget shortfall for FY 2011 and $107 million for FY 2012.  Yankton press. January 30, 2010.

Tennessee–1.5 billion state budget shortfall.   News Channel 5.com.  February 1, 2010

Texas –$10.8 - 20 billion state budget shortfall. Star-Telegram. February 6, 2010

Utah- $700 million state budget shortfall. KCPW December 11, 2009.

Vermont- State budget shortfall of $150 million for the current year.  could be $1 billion over the next four years.  Brattleboro Reformer.  January 8, 2010

Virginia—$4.2 billion state budget shortfall.  Stateline.org  January 15, 2010.

Washington –$2.6 billion state budget shortfall. Governor proposes a combination of program cuts;, tax increases (no specific ones identified) and federal aid to solve the problem.  The Spokesman Review. January 12, 2010

West Virginia - $120 million state budget shortfall in current budget. Timesw.v.com December 30, 2009

Wisconsin-$1.5 billion state budget shortfall for 2009-11 budget and $6 billion for 2011-13 budget. Wisconsin State Journal.  May 8, 2009

Wyoming-$300-325 million state budget shortfall.  Trib.com April 2, 2009

Testimony opposing making it easier for legislature to raise taxes

video is at http://www.tvw.org/media/mediaplayer.cfm?evid=2010020075&TYPE=V&CFID=834702&CFTOKEN=87087792&bhcp=1.  fast forward to 33 min.

Written testimony is http://www.effwa.org/main/article.php?article_id=3079

Senate Ways & Means
February 4, 2010
SB 6843

I am Bob Williams, Founder of the Evergreen Freedom Foundation, a free market research group based in Olympia.

I am speaking in opposition to SB 6843, which guts the voter-approved supermajority requirement for tax increases and tax transparency. This bill is not the solution to the legislature’s out-of-control spending problems.  The problems you face are due to unrealistically high levels of state spending, not to a lack of tax revenues.

You are breaking faith with the voters, who have repeatedly affirmed they want you to exhaust all your options before raising taxes and to limit state spending. Not only are you eviscerating the two-thirds requirement for tax increases, but you are cutting out the heart of I-960’s tax transparency measures. Since public hearings are usually scheduled with little notice, in most cases OFM will not be able to complete its tax and fee notices prior to the hearing, leaving members and the public in the dark. You are also denying the people a chance to vote on taxes.

Just a little over two years ago the voters passed I-960 when our economy was booming. By making it harder to raise taxes, they were asking you to limit spending. You ignored them and spent $1.3 billion more than the revenue forecast. If you couldn’t find a way to balance the budget at a time when the state took in record high revenues, as it did in 2007, it certainly is no surprise that you are unable to balance the budget today.

General fund state spending is up $7.2 billion, or 31 percent, since the 2003-05 budget.  Total state spending, despite all the talk about a $9 billion shortfall, is up $1.3 billion since the last budget cycle. And despite all the complaining, you only managed to reduce Near General Fund spending by 3.2 percent.

Every budget Governor Gregoire has submitted to the legislature has spent more than the revenue forecast, but the legislature has made the problem worse by using  accounting gimmicks, fund transfers, underfunding pensions etc. to allegedly balance the budget.  Long-term solutions have been repeatedly pushed forward and the crisis is growing. You are already aware that you face a $2.8 billion shortfall next year, plus more than $3 billion in federal funding that will not be there.

Moody’s Investors Service now gives Washington a negative credit outlook, and almost everything you are doing will exacerbate the problem. Moody’s lists some of their primary concerns as: an increased reliance on one-time budget solutions, a protracted structural budget imbalance, and failure to adopt a plan to cover expenditures once stimulus dollars run out.  

The Freedom Foundation has offered to work with you in the past and we offer again. Washington won a national award when Gov Locke worked on a bipartisan basis with Sen. Rossi to implement the priorities of government (POG) model which prioritized spending on an outcome basis and solved a $2.8 billion budget problem without raising taxes.  If you raise taxes in a recession, you are going to collect less revenue than you believe. In addition, tax increases will result in a loss of private sector jobs.  Businesses already face a 50 percent increase, or greater, in unemployment insurance taxes and a 7.6 percent increase in workers compensation costs.

I urge you to use POG to prioritize state spending. Patchwork tax increases of the kind this bill would enable are not the answer. They will hurt Washington’s families and businesses, and slow our economic recovery.

State Budget Shortfall - February 1, 2010

Rather than taking the necessary action and reducing state budgets to the estimated revenue forecast last year, most states used one-time federal stimulus money, accounting gimmicks and raided non-general funds in order to balance their state budgets.  Last year we predicted that most states will face multi-billion dollar deficits in the 2010-11 budgets because of this short term thinking.

I had an article in the ALEC newsletter discussing how states can balance their budgets without raising taxes.  http://www.alec.org/am/pdf/InsideALEC/InsideALECApril2009.pdf

Legislators of both parties allow bureaucrats to report a budget shortfall as the difference between what the governor wants to spend (not the current budget) vs the revenue forecast.  We have not found any state that reports a shortfall as the difference between the current level of spending and the revenue forecast.  Thus, most shortfalls are highly inflated.

The Center on Budget & Policy Priorities. (they have a very liberal bent) sees 2010 as the worse year of this century for state budget shortfalls and they don’t expect conditions to improve fast. They predict state budget shortfalls are likely to reach a whopping $180 billion for the coming fiscal year. Center on Budget and Policy Priorities. December 23, 2009.

Alabama-$600 million state budget shortfall for the 2011 budget.  MyFoxAl.com. December 15, 2009.

Alaska-$1.3 billion state budget shortfall Center on Budget Priorities December 23, 2009

Arizona-Gov. Brewer says state faces a $5 billion state budget shortfall over the next year and a half and calls for a sales tax increase to help solve the problem.  Phoenix Business Journal.  January 11, 2010.

-State can fix mess with spending discipline –Tom Patterson former State Senator. East Valley Tribune.com December 27, 2009.

California –Gov.Schwarzeegger request $6.9 billion to help solve California’s state budget shortfall. The Epoch Times. January 10, 2010

Gov. Schwarzenegger submits ‘draconian’ California Budget to close a $19.9 billion state budget shortfall.  Reuters. January 8, 2010

-State to sell 17 state buildings to help solve their state budget shortfall.  Firm headed by Diane Feinstein’s husband will handle the sale! SquareFeetblog.com/commercial-real-estate-blog.  December 11, 2009.

Colorado-$1.7 billion state budget shortfall this fiscal year and a $1.5 billion shortfall next year.  Coloradoan.com January 8, 2010.

Connecticut-Gov. Rell vetoed the legislature’s deficit mitigation plan, leaving the state with a state budget shortfall between $250 million and $500 million. Journal Inquirer. December 29, 2009

Delaware-$278 to $342 million state budget shortfall.  Do Delaware online. January 10, 2010

Florida- $3 billion state budget shortfall. The Palm Beach Post.  January 19, 2010.

Georgia- State budget shortfall of  nearly $1.5 billion. AJC.com. January 12, 2010 

Hawaii-$1.2 billion state budget shortfall. Los Angeles Times. January 2, 2010

Idaho-Gov. Otter states “we must live within our means” in his state-of-state address.  Idaho-Statesman.com. January 12, 2010

-$52 million state budget shortfall in the current fiscal year ending June 30, 2010.
Times-News Magic Valley.com.  January 1, 2010.

Indiana –$1.8 billion state budget shortfall. IDNonline.  January 19, 2010

Illinois - $12.8 billion state budget shortfall for the next fiscal year. Chicago Sun-Times. January 16, 2010

Iowa-$1 billion state budget shortfall in the fiscal year beginning July 1, 2010.  Chicago Tribune.  January 4, 2010.

Kansas- Gov. Parkinson is asking for a tax increase to address a $400 million state budget shortfall in the next fiscal year.  Kansas City Business Journal. January 12, 2010

Kentucky -state budget shortfall of $1.5 billion over the next two years.  Courier-journal.com. January 5, 2010

Louisiana- state budget shortfall of $1 billion for the 2010-11 fiscal year and at least a billion dollars more next year when the federal stimulus money stops.  Dailycomet.com. January 24, 2010

Maine- state budget shortfall of $438 million.  Bangor Daily News.  January 2, 2010.

Maryland –$2 billion state budget shortfall.  Washington Examiner. January 10, 2010

Massachusetts-Governor releases plan to solve State budget shortfall of $2.7 billion in fiscal 2011. myhomeless.wordpress. January 27,2010.

Michigan- $1.6 billion state budget shortfall. The Detroit News. January 12, 2010

Minnesota-  State budget shortfall is $1.2 billion for 2010-11 budget and another $5.4 billion for the 2011-12 budget.  Chaska Herald.  December 10, 2009

Mississippi-$715 million state budget shortfall for fiscal year 2011 and another $500 million in FY 2012.  Jacksonfreepress.com. November 25, 2009.

Missouri-State budget shortfall has been reduced to $261 million this year and an estimated $400 million next year.  January 23, 2009.

Nevada-   -$580 million state budget shortfall for 2010-11.  RGJ.com January 22, 2010

New Hampshire –Fiscal committee defeats $80 million transfer from rainy day fund to help close state budget shortfall. New Hampshire Watchdog.org. January 8, 2010.

-state budget shortfall of up to $306 million for the 2010-11 budget.  Nashua Telegraph. December 18, 2009

New Jersey- $1.2 billion state budget shortfall. Daily Record.com  January 20, 2010

New Mexico- $600 million state budget shortfall. CNJonline.com  January 16, 2010

New York – $600 million state budget shortfall in current fiscal year and up to $9 billion state budget shortfall for 10-11 fiscal year. Politics on the Hudson.  December 31, 2009

North Carolina – $4 billion state budget shortfall.  Legislature still hasn’t passed budget for fiscal year that started on July 1, 2009!  Winston-Salem Journal. January 10, 2010.

Oklahoma-$750 million state budget shortfall for this fiscal year ending June 30, 2010.  NewsOn6.com

Ohio-Gov. Strickland sings new state budget that fills a $851 million state budget shortfall by delaying this year’s 4.2 percent income tax cut. The Columbus Dispatch. December 22, 2009

Oregon- Oregon voters approve two tax measures which raises $727 million in taxes on corporations and the wealthy to eliminate state budget shortfall. The Oregonian January 26, 2010

Pennsylvania -    $3 billion state budget shortfall.  The Mercury.  January 1, 2010

Rhode Island –Nearly $219 million state budget shortfall this fiscal year.  Governor proposes to cut $1.1million from town and schools.  EastBayRI.com December 16, 2009.

South Carolina –$560 million state budget shortfall in the current budget; $1.3 billion shortfall for the 2011-12 budget and a $1.4 billion shortfall in 2012-13. GreenvilleOnline.com. January 8, 2010.

South Dakota-$32 million state budget shortfall for FY 2011 and $107 million for FY 2012.  Yankton press. January 30, 2010.

Tennessee–Could face a $1 billion state budget shortfall.  The Cattanoogan.com.  January 4, 2010.

Texas –Texas faces $15 billion state budget shortfall if they continue their commitment to hold down property taxes, to pay for increasing enrollment in public schools, colleges, Medicaid, and to replace the stimulus dollars used to balance the current state budget.  Statesman.com. December 19, 2009

Utah- $700 million state budget shortfall. KCPW December 11, 2009. http://kcpw.org/blog/local-news/2009-12-11/governor-herbert-unveils-budget/

Vermont- State budget shortfall of $150 million for the current year.  could be $1 billion over the next four years.  Brattleboro Reformer.  January 8, 2010

Virginia—$4.2 billion state budget shortfall.  Stateline.org  January 15, 2010.

Washington –$2.6 billion state budget shortfall. Governor proposes a combination of program cuts;, tax increases (no specific ones identified) and federal aid to solve the problem.  The Spokesman Review. January 12, 2010

West Virginia - $120 million state budget shortfall in current budget. Timesw.v.com December 30, 2009

Wisconsin-$1.5 billion state budget shortfall for 2009-11 budget and $6 billion for 2011-13 budget. Wisconsin State Journal.  May 8, 2009

Wyoming-$300-325 million state budget shortfall.  Trib.com April 2, 2009

State Budget Shortfall - January 25, 2010

Rather than taking the necessary action and reducing state budgets to the estimated revenue forecast last year, most states used one-time federal stimulus money, accounting gimmicks and raided non-general funds in order to balance their state budgets.  Last year we predicted that most states will face multi-billion dollar deficits in the 2010-11 budgets because of this short term thinking.

I had an article in the ALEC newsletter discussing how states can balance their budgets without raising taxes.  http://www.alec.org/am/pdf/InsideALEC/InsideALECApril2009.pdf

Legislators of both parties allow bureaucrats to report a budget shortfall as the difference between what the governor wants to spend (not the current budget) vs the revenue forecast.  We have not found any state that reports a shortfall as the difference between the current level of spending and the revenue forecast.  Thus, most shortfalls are highly inflated.

The Center on Budget & Policy Priorities. (they have a very liberal bent) sees 2010 as the worse year of this century for state budget shortfalls and they don’t expect conditions to improve fast. They predict state budget shortfalls are likely to reach a whopping $180 billion for the coming fiscal year. Center on Budget and Policy Priorities. December 23, 2009.

Alabama-$600 million state budget shortfall for the 2011 budget.  MyFoxAl.com. December 15, 2009.

Alaska-$1.3 billion state budget shortfall Center on Budget Priorities December 23, 2009

Arizona-Gov. Brewer says state faces a $5 billion state budget shortfall over the next year and a half and calls for a sales tax increase to help solve the problem.  Phoenix Business Journal.  January 11, 2010.

-State can fix mess with spending discipline –Tom Patterson former State Senator. East Valley Tribune.com December 27, 2009.

California –Gov.Schwarzeegger request $6.9 billion to help solve California’s state budget shortfall. The Epoch Times. January 10, 2010

Gov. Schwarzenegger submits ‘draconian’ California Budget to close a $19.9 billion state budget shortfall.  Reuters. January 8, 2010

-State to sell 17 state buildings to help solve their state budget shortfall.  Firm headed by Diane Feinstein’s husband will handle the sale! SquareFeetblog.com/commercial-real-estate-blog.  December 11, 2009.

Colorado-$1.7 billion state budget shortfall this fiscal year and a $1.5 billion shortfall next year.  Coloradoan.com January 8, 2010.

Connecticut-Gov. Rell vetoed the legislature’s deficit mitigation plan, leaving the state with a state budget shortfall between $250 million and $500 million. Journal Inquirer. December 29, 2009

Delaware-$278 to $342 million state budget shortfall.  Do Delaware online. January 10, 2010

Florida- $3 billion state budget shortfall. The Palm Beach Post.  January 19, 2010.

Georgia- State budget shortfall of  nearly $1.5 billion. AJC.com. January 12, 2010 

Hawaii-$1.2 billion state budget shortfall. Los Angeles Times. January 2, 2010

Idaho-Gov. Otter states “we must live within our means” in his state-of-state address.  Idaho-Statesman.com. January 12, 2010

-$52 million state budget shortfall in the current fiscal year ending June 30, 2010.
Times-News Magic Valley.com.  January 1, 2010.

Indiana –$1.8 billion state budget shortfall. IDNonline.  January 19, 2010

Illinois - $12.8 billion state budget shortfall for the next fiscal year. Chicago Sun-Times. January 16, 2010

Iowa-$1 billion state budget shortfall in the fiscal year beginning July 1, 2010.  Chicago Tribune.  January 4, 2010.

Kansas- Gov. Parkinson is asking for a tax increase to address a $400 million state budget shortfall in the next fiscal year.  Kansas City Business Journal. January 12, 2010

Kentucky -state budget shortfall of $1.5 billion over the next two years.  Courier-journal.com. January 5, 2010

Louisiana- state budget shortfall of $1 billion for the 2010-11 fiscal year and at least a billion dollars more next year when the federal stimulus money stops.  Dailycomet.com. January 24, 2010

Maine- state budget shortfall of $438 million.  Bangor Daily News.  January 2, 2010.

Maryland –$2 billion state budget shortfall.  Washington Examiner. January 10, 2010

Massachusetts-State budget shortfall $3.0 billion in fiscal 2011. Boston Business Journal. December 10, 2009.

Michigan- $1.6 billion state budget shortfall. The Detroit News. January 12, 2010

Minnesota-  State budget shortfall is $1.2 billion for 2010-11 budget and another $5.4 billion for the 2011-12 budget.  Chaska Herald.  December 10, 2009

Mississippi-$715 million state budget shortfall for fiscal year 2011 and another $500 million in FY 2012.  Jacksonfreepress.com. November 25, 2009.

Missouri-State budget shortfall has been reduced to $261 million this year and an estimated $400 million next year.  January 23, 2009.

Nevada-   -$580 million state budget shortfall for 2010-11.  RGJ.com January 22, 2010

New Hampshire –Fiscal committee defeats $80 million transfer from rainy day fund to help close state budget shortfall. New Hampshire Watchdog.org. January 8, 2010.

-state budget shortfall of up to $306 million for the 2010-11 budget.  Nashua Telegraph. December 18, 2009

New Jersey- $1.2 billion state budget shortfall. Daily Record.com  January 20, 2010

New Mexico- $600 million state budget shortfall. CNJonline.com  January 16, 2010

New York – $600 million state budget shortfall in current fiscal year and up to $9 billion state budget shortfall for 10-11 fiscal year. Politics on the Hudson.  December 31, 2009

North Carolina – $4 billion state budget shortfall.  Legislature still hasn’t passed budget for fiscal year that started on July 1, 2009!  Winston-Salem Journal. January 10, 2010.

Oklahoma-$750 million state budget shortfall for this fiscal year ending June 30, 2010.  NewsOn6.com

Ohio-Gov. Strickland sings new state budget that fills a $851 million state budget shortfall by delaying this year’s 4.2 percent income tax cut. The Columbus Dispatch. December 22, 2009

Oregon- $4.4 billion state budget shortfall.  KVAC.com April 22, 2009

Pennsylvania -    $3 billion state budget shortfall.  The Mercury.  January 1, 2010

Rhode Island –Nearly $219 million state budget shortfall this fiscal year.  Governor proposes to cut $1.1million from town and schools.  EastBayRI.com December 16, 2009.

South Carolina –$560 million state budget shortfall in the current budget; $1.3 billion shortfall for the 2011-12 budget and a $1.4 billion shortfall in 2012-13. GreenvilleOnline.com. January 8, 2010.

South Dakota-$150-200 million state budget shortfall.  Rapidcityjournal.com. November 29, 2009.

Tennessee–Could face a $1 billion state budget shortfall.  The Cattanoogan.com.  January 4, 2010.

Texas –Texas faces $15 billion state budget shortfall if they continue their commitment to hold down property taxes, to pay for increasing enrollment in public schools, colleges, Medicaid, and to replace the stimulus dollars used to balance the current state budget.  Statesman.com. December 19, 2009

Utah- $700 million state budget shortfall. KCPW December 11, 2009. http://kcpw.org/blog/local-news/2009-12-11/governor-herbert-unveils-budget/

Vermont- State budget shortfall of $150 million for the current year.  could be $1 billion over the next four years.  Brattleboro Reformer.  January 8, 2010

Virginia—$4.2 billion state budget shortfall.  Stateline.org  January 15, 2010.

Washington –$2.6 billion state budget shortfall. Governor proposes a combination of program cuts;, tax increases (no specific ones identified) and federal aid to solve the problem.  The Spokesman Review. January 12, 2010

West Virginia - $120 million state budget shortfall in current budget. Timesw.v.com December 30, 2009

Wisconsin-$1.5 billion state budget shortfall for 2009-11 budget and $6 billion for 2011-13 budget. Wisconsin State Journal.  May 8, 2009

Wyoming-$300-325 million state budget shortfall.  Trib.com April 2, 2009

Education Reform group wants 50% of all new revenue

Education reform group wants 50% of all new revenue. The education bureaucracy doesn’t need more of our hard earned tax dollars. Taxpayers need more (better) education for the dollars already invested.  $12,200/child/year and what are we getting- 1/3 of the students don’t graduate from high school. http://www.tri-cityherald.com/1154/story/868957.html

State Budget Shortfall - January 18, 2010

Rather than taking the necessary action and reducing state budgets to the estimated revenue forecast last year, most states used one-time federal stimulus money, accounting gimmicks and raided non-general funds in order to balance their state budgets.  Last year we predicted that most states will face multi-billion dollar deficits in the 2010-11 budgets because of this short term thinking.

I had an article in the ALEC newsletter discussing how states can balance their budgets without raising taxes.  http://www.alec.org/am/pdf/InsideALEC/InsideALECApril2009.pdf

Legislators of both parties allow bureaucrats to report a budget shortfall as the difference between what the governor wants to spend (not the current budget) vs the revenue forecast.  We have not found any state that reports a shortfall as the difference between the current level of spending and the revenue forecast.  Thus, most shortfalls are highly inflated.

The Center on Budget & Policy Priorities. (they have a very liberal bent) sees 2010 as the worse year of this century for state budget shortfalls and they don’t expect conditions to improve fast. They predict state budget shortfalls are likely to reach a whopping $180 billion for the coming fiscal year. Center on Budget and Policy Priorities. December 23, 2009.

Alabama-$600 million state budget shortfall for the 2011 budget.  MyFoxAl.com. December 15, 2009.

Alaska-$1.3 billion state budget shortfall Center on Budget Priorities December 23, 2009

Arizona-Gov. Brewer says state faces a $5 billion state budget shortfall over the next year and a half and calls for a sales tax increase to help solve the problem.  Phoenix Business Journal.  January 11, 2010.

-State can fix mess with spending discipline –Tom Patterson former State Senator. East Valley Tribune.com December 27, 2009.

California –Gov.Schwarzeegger request $6.9 billion to help solve California’s state budget shortfall. The Epoch Times. January 10, 2010

Gov. Schwarzenegger submits ‘draconian’ California Budget to close a $19.9 billion state budget shortfall.  Reuters. January 8, 2010

-State to sell 17 state buildings to help solve their state budget shortfall.  Firm headed by Diane Feinstein’s husband will handle the sale! SquareFeetblog.com/commercial-real-estate-blog.  December 11, 2009.

Colorado-$1.7 billion state budget shortfall this fiscal year and a $1.5 billion shortfall next year.  Coloradoan.com January 8, 2010.

Connecticut-Gov. Rell vetoed the legislature’s deficit mitigation plan, leaving the state with a state budget shortfall between $250 million and $500 million. Journal Inquirer. December 29, 2009

Delaware-$278 to $342 million state budget shortfall.  Do Delaware online. January 10, 2010

Florida-$3 billion state budget shortfall.  Capitol News Service.  April 20, 2009

Georgia- State budget shortfall of  nearly $1.5 billion. AJC.com. January 12, 2010

Hawaii-$1.2 billion state budget shortfall. Los Angeles Times. January 2, 2010

Idaho-Gov. Otter states “we must live within our means” in his state-of-state address.  Idaho-Statesman.com. January 12, 2010

-$52 million state budget shortfall in the current fiscal year ending June 30, 2010.
Times-News Magic Valley.com.  January 1, 2010.

Indiana –Governor Daniels recently ordered $300 million budget cuts to K-12 to eliminate state budget shortfall. Indianasnewscenter.com. January 1, 2010

Illinois - $12.8 billion state budget shortfall for the next fiscal year. Chicago Sun-Times. January 16, 2010

Iowa-$1 billion state budget shortfall in the fiscal year beginning July 1, 2010.  Chicago Tribune.  January 4, 2010.

Kansas- Gov. Parkinson is asking for a tax increase to address a $400 million state budget shortfall in the next fiscal year.  Kansas City Business Journal. January 12, 2010

Kentucky -state budget shortfall of $1.5 billion over the next two years.  Courier-journal.com. January 5, 2010

Louisiana- state budget shortfall of up to $2 billion next year.  The News Star.com. January 17, 2010

Maine- state budget shortfall of $438 million.  Bangor Daily News.  January 2, 2010.

Maryland –$2 billion state budget shortfall.  Washington Examiner. January 10, 2010

Massachusetts-State budget shortfall $3.0 billion in fiscal 2011. Boston Business Journal. December 10, 2009.

Michigan- $1.6 billion state budget shortfall. The Detroit News. January 12, 2010

Minnesota-  State budget shortfall is $1.2 billion for 2010-11 budget and another $5.4 billion for the 2011-12 budget.  Chaska Herald.  December 10, 2009

Mississippi-$715 million state budget shortfall for fiscal year 2011 and another $500 million in FY 2012.  Jacksonfreepress.com. November 25, 2009.

Missouri-State budget shortfall has been reduced to $261 million this year and an estimated $400 million next year.  January 23, 2009.

Nevada-   -$50 million state budget shortfall. Lasvegasnow.com. December 15, 2009.

New Hampshire –Fiscal committee defeats $80 million transfer from rainy day fund to help close state budget shortfall. New Hampshire Watchdog.org. January 8, 2010.

-state budget shortfall of up to $306 million for the 2010-11 budget.  Nashua Telegraph. December 18, 2009

New Jersey- $1 billion state budget shortfall. NJ.com December 1, 2009.

New Mexico- $600 million state budget shortfall. CNJonline.com  January 16, 2010

New York – $600 million state budget shortfall in current fiscal year and up to $9 billion state budget shortfall for 10-11 fiscal year. Politics on the Hudson.  December 31, 2009

North Carolina – $4 billion state budget shortfall.  Legislature still hasn’t passed budget for fiscal year that started on July 1, 2009!  Winston-Salem Journal. January 10, 2010.

Oklahoma-$750 million state budget shortfall for this fiscal year ending June 30, 2010.  NewsOn6.com

Ohio-Gov. Strickland sings new state budget that fills a $851 million state budget shortfall by delaying this year’s 4.2 percent income tax cut. The Columbus Dispatch. December 22, 2009

Oregon- $4.4 billion state budget shortfall.  KVAC.com April 22, 2009

Pennsylvania -    $3 billion state budget shortfall.  The Mercury.  January 1, 2010

Rhode Island –Nearly $219 million state budget shortfall this fiscal year.  Governor proposes to cut $1.1million from town and schools.  EastBayRI.com December 16, 2009.

South Carolina –$560 million state budget shortfall in the current budget; $1.3 billion shortfall for the 2011-12 budget and a $1.4 billion shortfall in 2012-13. GreenvilleOnline.com. January 8, 2010.

South Dakota-$150-200 million state budget shortfall.  Rapidcityjournal.com. November 29, 2009.

Tennessee–Could face a $1 billion state budget shortfall.  The Cattanoogan.com.  January 4, 2010.

Texas –Texas faces $15 billion state budget shortfall if they continue their commitment to hold down property taxes, to pay for increasing enrollment in public schools, colleges, Medicaid, and to replace the stimulus dollars used to balance the current state budget.  Statesman.com. December 19, 2009

Utah- $700 million state budget shortfall. KCPW December 11, 2009. http://kcpw.org/blog/local-news/2009-12-11/governor-herbert-unveils-budget/

Vermont- State budget shortfall of $150 million for the current year.  could be $1 billion over the next four years.  Brattleboro Reformer.  January 8, 2010

Virginia—$4.2 billion state budget shortfall.  Stateline.org  January 15, 2010.

Washington –$2.6 billion state budget shortfall. Governor proposes a combination of program cuts;, tax increases (no specific ones identified) and federal aid to solve the problem.  The Spokesman Review. January 12, 2010

West Virginia - $120 million state budget shortfall in current budget. Timesw.v.com December 30, 2009

Wisconsin-$1.5 billion state budget shortfall for 2009-11 budget and $6 billion for 2011-13 budget. Wisconsin State Journal.  May 8, 2009

Wyoming-$300-325 million state budget shortfall.  Trib.com April 2, 2009

Governor understates financial crises facing Washington state

In her state-of-the-state address, Governor Gregoire proposed to cut essential programs and will do that unless her Boss (the taxpayers) give her a raise (higher taxes).

Gov. Gregoire says without a tax hike she will eliminate essential programs.  Gov. Gregoire has abandoned the highly successful Priority of Government model which would have prioritized services and resulted in the lowest priority programs being cut.

Unfortunately, Governor Gregoire significantly downplayed the serious financial problems facing the Washington state and legislators and the public are not aware of  the depth of the financial problems, which are:

-the current level of state spending is unsustainable and if the governor’s proposals to close the $2.6 billion budget shortfall are enacted the state will still face at least a $2.8 billion shortfall next year when they prepare the 2011-2013 budget

-The urgent warning from the State Treasurer that the state will run out of money in September unless action is taken.  http://www.thenewstribune.com/updates/story/1018856.html

-Moody’s downgrade of our bonds to “Negative” on December 31, 2009.  They warned about the negative impact of the state making significant use of one-time actions to balance current biennium budget reduced the flexibility of the state to address unexpected revenue shortfalls.  Further “Washington’s debt ratios are about twice Moody’s 50-state median of 2.5% in 2009.  and “at $2,098, Washington’s net-tax supported debt per capita is more than twice the nation median of $865.”  Moody’s further warned on the factors that could lower the rating:

-“Deeper and longer recession or muted recovery that restrains consumer confidence, leading to prolonged revenue weakness and employment erosion.

-“Protracted structural budget inbalance .”  (Nothing in the Governor’s proposals address the structural budget inbalance.

-“Cash flow narrowing, leading to strained liquidity.” – (the governor didn’t address the State Treasurer’s concerns)

-“Failure to adopt plan to cover expenditures once federal fiscal stimulus monies are no longer available.” (the governor had no plan to address this issue).

-Credit Suisse’s report that Washington has an unfunded retiree’s health care liability for $10 billion.  The state’s Consolidated Annual Financial Report (CAFR) reports the liability as $4 billion as of June 30, 2009.

-The State Auditor’s financial and actuarial audit of workers compensation which revealed serious financial problems in the solvency of the accident fund.  (The response of the L&I Director was unbelievable – “one of the unique benefits of the Washington State Fund is that it can continue to make good on its benefit obligations when projected liabilities exceed its projected assets when private insurers would not be able to do so.”

$ ?? billions in unfunded pension obligations.

-$617 million deficit in the Risk Management Fund.

-Gov. Gregoire’s December 12 statement that every dollar that was not cut then would result in $2 having to be cut later.

The Governor refuses to take the action required by the Budget & Accounting Act to implement across the board cuts in order to avoid a cash deficit.

State Budget Shortfall - January 11, 2010

Rather than taking the necessary action and reducing state budgets to the estimated revenue forecast last year, most states used one-time federal stimulus money, accounting gimmicks and raided non-general funds in order to balance their state budgets.  Last year we predicted that most states will face multi-billion dollar deficits in the 2010-11 budgets because of this short term thinking.

I had an article in the ALEC newsletter discussing how states can balance their budgets without raising taxes.  http://www.alec.org/am/pdf/InsideALEC/InsideALECApril2009.pdf

Legislators of both parties allow bureaucrats to report a budget shortfall as the difference between what the governor wants to spend (not the current budget) vs the revenue forecast.  We have not found any state that reports a shortfall as the difference between the current level of spending and the revenue forecast.  Thus, most shortfalls are highly inflated.

The Center on Budget & Policy Priorities. (they have a very liberal bent) sees 2010 as the worse year of this century for state budget shortfalls and they don’t expect conditions to improve fast. They predict state budget shortfalls are likely to reach a whopping $180 billion for the coming fiscal year. Center on Budget and Policy Priorities. December 23, 2009.

Alabama-$600 million state budget shortfall for the 2011 budget.  MyFoxAl.com. December 15, 2009.

Alaska-$1.3 billion state budget shortfall Center on Budget Priorities December 23, 2009

Arizona-State can fix mess with spending discipline –Tom Patterson former State Senator. East Valley Tribune.com December 27, 2009.

Legislature is in special session to deal with a $1.6 billion state budget shortfall in the current year and a $3 billion projected budget for the next budget.  SFExaminer.com  December 18, 2009.

California –Gov.Schwarzeegger request $6.9 billion to help solve California’s state budget shortfall. The Epoch Times. January 10, 2010

Gov. Schwarzenegger submits ‘draconian’ California Budget to close a $19.9 billion state budget shortfall.  Reuters. January 8, 2010

-State to sell 17 state buildings to help solve their state budget shortfall.  Firm headed by Diane Feinstein’s husband will handle the sale! SquareFeetblog.com/commercial-real-estate-blog.  December 11, 2009.

Colorado-$1.7 billion state budget shortfall this fiscal year and a $1.5 billion shortfall next year.  Coloradoan.com January 8, 2010.

Connecticut-Gov. Rell vetoed the legislature’s deficit mitigation plan, leaving the state with a state budget shortfall between $250 million and $500 million. Journal Inquirer. December 29, 2009

Delaware-$278 to $342 million state budget shortfall.  Do Delaware online. January 10, 2010

Florida-$3 billion state budget shortfall.  Capitol News Service.  April 20, 2009

Georgia- State budget shortfall of $1 billion. WSBradio.com.  December 5, 2009.

Hawaii-$1.2 billion state budget shortfall. Los Angeles Times. January 2, 2010

Idaho-$52 million state budget shortfall in the current fiscal year ending June 30, 2010.
Times-News Magic Valley.com.  January 1, 2010.

Indiana –Governor Daniels recently ordered $300 million budget cuts to K-12 to eliminate state budget shortfall. Indianasnewscenter.com. January 1, 2010

Illinois - $11 billion state budget shortfall for the next fiscal year.  Daily Herald. January 5, 2010.

Iowa-$1 billion state budget shortfall in the fiscal year beginning July 1, 2010.  Chicago Tribune.  January 4, 2010.

Kansas- Kansas faces up to a $400 million state budget shortfall in the next fiscal year.  ABC NewsMoney. January 5, 2010.

Kentucky -state budget shortfall of $1.5 billion over the next two years.  Courier-journal.com. January 5, 2010

Louisiana- state budget shortfall of $950 million. AP December 16, 2009.

Maine- state budget shortfall of $438 million.  Bangor Daily News.  January 2, 2010.

Maryland –$2 billion state budget shortfall.  Washington Examiner. January 10, 2010

Massachusetts-State budget shortfall 3.0 billion in fiscal 2011. Boston Business Journal. December 10, 2009.

Michigan- $2.5 billion state budget shortfall.  WJAJ. July 17, 2009

Minnesota-  State budget shortfall is $1.2 billion for 2010-11 budget and another $5.4 billion for the 2011-12 budget.  Chaska Herald.  December 10, 2009

Mississippi-$715 million state budget shortfall for fiscal year 2011 and another $500 million in FY 2012.  Jacksonfreepress.com. November 25, 2009.

Missouri-State budget shortfall has been reduced to $261 million this year and an estimated $400 million next year.  January 23, 2009.

Nevada-   -$50 million state budget shortfall. Lasvegasnow.com. December 15, 2009.

New Hampshire –state budget shortfall of up to $306 million for the 2010-11 budget.  Nashua Telegraphl. December 18, 2009

New Jersey- $1 billion state budget shortfall. NJ.com December 1, 2009.

New Mexico- $500 million state budget shortfall.  NewsOK-Nov. 29. 2009

New York – $600 million state budget shortfall in current fiscal year and up to $9 billion state budget shortfall for 10-11 fiscal year. Politics on the Hudson.  December 31, 2009

North Carolina – $4 billion state budget shortfall.  Legislature still hasn’t passed budget for fiscal year that started on July 1, 2009!  Winston-Salem Journal. January 10, 2010.

Oklahoma-$750 million state budget shortfall for this fiscal year ending June 30, 2010.  NewsOn6.com

Ohio-Gov. Strickland sings new state budget that fills a $851 million state budget shortfall by delaying this year’s 4.2 percent income tax cut. The Columbus Dispatch. December 22, 2009

Oregon- $4.4 billion state budget shortfall.  KVAC.com April 22, 2009

Pennsylvania -    $3 billion state budget shortfall.  The Mercury.  January 1, 2010

Rhode Island –Nearly $219 million state budget shortfall this fiscal year.  Governor proposes to cut $1.1million from town and schools.  EastBayRI.com December 16, 2009.

South Carolina –$560 million state budget shortfall in the current budget; $1.3 billion shortfall for the 2011-12 budget and a $1.4 billion shortfall in 2012-13. GreenvilleOnline.com. January 8, 2010.

South Dakota-$150-200 million state budget shortfall.  Rapidcityjournal.com. November 29, 2009.

Tennessee –Could face a $1 billion state budget shortfall.  The Cattanoogan.com.  January 4, 2010.

Texas –Texas faces $15 billion state budget shortfall if they continue their commitment to hold down property taxes, to pay for increasing enrollment in public schools, colleges, Medicaid, and to replace the stimulus dollars used to balance the current state budget.  Statesman.com. December 19, 2009

Utah- $700 million state budget shortfall. KCPW December 11, 2009. http://kcpw.org/blog/local-news/2009-12-11/governor-herbert-unveils-budget/

Vermont- State budget shortfall of $150 million for the current year.  could be $1 billion over the next four years.  Brattleboro Reformer.  January 8, 2010

Virginia—$3.6 billion state budget shortfall and Governor-elect pledges not to raise taxes. Virginiabusiness.com. December 29, 2009.

Washington –$2.6 billion state budget shortfall.  Governor proposes radical cuts to balance budget. Governor’s office.  December 9,2009

West Virginia - $120 million state budget shortfall in current budget. Timesw.v.com December 30, 2009

Wisconsin-$1.5 billion state budget shortfall for 2009-11 budget and $6 billion for 2011-13 budget. Wisconsin State Journal.  May 8, 2009

Wyoming-$300-325 million state budget shortfall.  Trib.com April 2, 2009

Despite Gregoire's claims, public employee contracts can be changed

To solve Washington state’s budget problems the governor or the legislature need to declare a fiscal emergency which will force the public employees unions to renegotiate their contracts. Taxpayers can no longer afford to pay the excessive salaries and benefits of public employees. http://www.effwa.org/main/article.php?ar ticle_id=3042

Willie Brown former Speaker of California Assemby says state employee contracts are unsustainable

Willie Brown in the San Francisco Chronicle on Jan. 3. 2009

If we as a state want to make a New Year’s resolution, I suggest taking a good look at the California we have created. From our out-of-sync tax system to our out-of-control civil service, it’s time for politicians to begin an honest dialogue about what we’ve become.

Take the civil service.

The system was set up so politicians like me couldn’t come in and fire the people (relatives) hired by the guy they beat and replace them with their own friends and relatives.

Over the years, however, the civil service system has changed from one that protects jobs to one that runs the show.

The deal used to be that civil servants were paid less than private sector workers in exchange for an understanding that they had job security for life.

But we politicians, pushed by our friends in labor, gradually expanded pay and benefits to private-sector levels while keeping the job protections and layering on incredibly generous retirement packages that pay ex-workers almost as much as current workers.

Talking about this is politically unpopular and potentially even career suicide for most officeholders. But at some point, someone is going to have to get honest about the fact that 80 percent of the state, county and city budget deficits are due to employee costs.

Either we do something about it at the ballot box, or a judge will do something about in Bankruptcy Court. And if you think I’m kidding, just look at Vallejo.

Read more: http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2010/01/03/BA2V1BBGHH.DTL#ixzz0bwXQXXMd