Angry New Yorker

Monday, May 12, 2003
Center on Budget and Policy Priorities

By Nicholas Johnson and Rose Ribeiro

States have closed, or are closing, about $80 billion in budget shortfalls for the current fiscal year (which ends June 30 in most states) and another $79 billion in shortfalls for FY 2004, according to the National Conference of State Legislatures. Forced by balanced budget requirements to close these deficits, states have been cutting important programs and services, including education, health care, and public safety.

Now the crisis appears to be worsening. New data show that in a number of states, including California, Colorado, Connecticut, Idaho, New York, North Carolina, and Pennsylvania, revenues for April fell short of expectations, so these states are raising their deficit forecasts. Clearly, states are unlikely to pull out of the fiscal crisis by themselves anytime soon. Without new revenues, states are likely to enact increasingly painful budget cuts. [PDF of full report]

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