Presentation is loading. Please wait.

Presentation is loading. Please wait.

Fiscal Condition of the States Presentation to the Rhode Island House of Representatives Economic Forum December 1, 2009 Arturo Pérez Fiscal Affairs Program.

Similar presentations


Presentation on theme: "Fiscal Condition of the States Presentation to the Rhode Island House of Representatives Economic Forum December 1, 2009 Arturo Pérez Fiscal Affairs Program."— Presentation transcript:

1 Fiscal Condition of the States Presentation to the Rhode Island House of Representatives Economic Forum December 1, 2009 Arturo Pérez Fiscal Affairs Program NCSL

2 Overview The state fiscal situation is dire. The current revenue situation is nearly unprecedented, at least in recent decades. To date, states have reported a total estimated budget gap of $386.8 billion (FY 2008 through FY 2012).

3 U.S. Business Cycle Downturns : Duration in Months Source: National Bureau of Economic Research

4 FY 2010 Revenue Outlook Rhode Island Delawar e Source: NCSL survey of state legislative fiscal offices, April Stable n = 1 Concerned n = 28 Pessimistic n = 21 Optimistic n = 0 No response n = 1 Puerto Rico

5 How Bad is the Revenue Situation? Florida reports that annual revenues today compare to FY 2001 levels and are not expected to return to peak levels (which occurred in FY 2006) until FY Colorado reports that annual revenues today are similar to amounts collected in FY In Kansas, general funds revenues are coming in at FY 2006 levels.

6 Pre-Enactment FY 2010 Budget Gaps as a Percentage of General Fund Budget Rhode Island Delaware Source: NCSL survey of state legislative fiscal offices, % to 19.9%, n = 18 5% to 9.9%, n = 5 0.1% to 4.9%, n = 6 More than 20% n= 17 Not applicable or not reporting, n = 5 Puerto Rico

7 Use of Spending Cuts as Percentage of Actions To Close FY 2010 Budget Gaps (preliminary) Rhode Island Delaware Source: NCSL survey of state legislative fiscal offices, Used spending cuts, n = 39 Puerto Rico- 61.8% 44.7% 43.0% 17.0% 3.9% 40.0% 20.8% 19.1% 19.5% 58.0% 32.0% 23.7% 22.7% 36.7% VT- 25.0% 26.6% 45.1% 45.5% 100.0% 48.0% 40.0% 48.0% 15.8% 47.4% 46.0% 36.4% 49.4% 60.0% No Response, n = 5 Not Applicable, n = 7 4.1% 74.3% MD % NJ- 38.7% RI- 48.7% WV- 60.0% CT % DE % MA %

8 Rhode Island Delaware Source: NCSL survey of state legislative fiscal offices, Used ARRA funds, n = 40 Puerto Rico- 17.9% 96.7% 88.0% 28.6% 26.0% 54.0% 33.0% 3.0% 60.0% 45.5% 43.0% 57.3% 64.3% 68.4% 30.0% 29.0% 30.2% 27.1% 39.2% VT- 62.0% 61.4% 43.4% 21.0% Use of ARRA Funds as Percentage of Actions To Close FY 2010 Budget Gaps (preliminary) 13.0% 44.7% 32.9% 40.0% 30.7% 24.3% 25.0% No Response, n = 5 Not Applicable, n = % MD % NJ- 27.3% RI- 40.3% CT % DE % NH- 41.1% WV- 40.0% MA %

9 Rhode Island Delaware Source: NCSL survey of state legislative fiscal offices, Tapped Rainy Day Fund & Other Funds, n = 5 Puerto Rico Tapped Rainy Day Funds and Other Funds as Percentage of Actions To Close FY 2010 Budget Gaps (preliminary) No Response, n = 6 Not Applicable, n = 22 Tapped Other Funds, n = 12 Tapped Rainy Day Fund, n = 6 8.4% 35.0% 28.8 % 8.4% 15.0 % 15.7 % 3.0% 5.0% 7.6% 12.0 % 4.2% 3.8% 5.5% 3.1% 5.1% 5.6% 3.0% 1.0% 5.0% MD % NJ- 1.5% CT % MA- 6.5%

10 Rhode Island Delaware Source: NCSL survey of state legislative fiscal offices, Raised Taxes, n = 22 Puerto Rico- 15.7% VT- 8.0% Use of Tax Increases as Percentage of Actions To Close FY 2010 Budget Gaps (preliminary) No Response, n = 4 MD - 0.3% NJ- 13.5% RI- 9.5% CT % DE % NH- 22.6% Not Applicable, n = % 7.3% 12.1% 0.7% 6.8% 2.1% 14.8% 39.3% 21.6% 18.3% 7.0% 26.0% MA %

11 2009 Net State Tax Changes by Type of Tax Type of TaxDollars (in millions)Percent of Total Personal Income $11, % Corporate Income $1, % Sales & Use $7, % Health Care Providers $1, % Cigarette & Tobacco $1, % Motor Fuel $1, % Alcoholic Beverage $ % Miscellaneous $1, % Net Change $27, % Source: National Conference of State Legislatures, Figures represent 47 reporting states. States not included are: MI, PA, and RI.

12 Net State Tax Changes by Year of Enactment Source: NCSL survey of legislative fiscal offices, various years figures represent 47 reporting states. States not included are: MI, PA, and RI.

13 Federal Outlays for Major Provisions of ARRA Affecting State and Local Governments ($ in billions) Source: Congressional Budget Office

14 43 states 45 states 42 states 33 states 26 states 1 state 20 states* 44 states* 46 states* 28 states** 16 states*** State Budget Gaps FY 2002-FY 2012 (projected) No estimate * Includes Puerto Rico ** 33 states and Puerto Rico forecast FY 2011 gaps. The amount shown for FY 2011 indicates the 28 states that provided gap estimates. *** 24states forecast FY 2012 gaps. The amount shown for the FY 2012 indicates the 16 states that provided gap estimates. Source: NCSL survey of legislative fiscal offices, various years Amount After Fiscal Year Began Amount Before Budget Adoption Projected Amount

15 Rhode Island Delaware Source: Various media and government outlets, July through November New Budget Gap, n = 31 Puerto Rico Post-Enactment FY 2010 Budget Gaps Not Applicable, n = 20

16 FY 2011 Budget Gaps as a Percentage of General Fund Budget Rhode Island Delaware Source: NCSL survey of state legislative fiscal offices, various years. Puerto Rico More than 20.0%, n = 6 10% to 19.9%, n = % to 9.9%, n = 9 Budget gap projected, amount unknown, n= 8 Not applicable or not reporting, n = 17

17 FY 2012 Budget Gaps as a Percentage of General Fund Budget Rhode Island Delaware Source: NCSL survey of state legislative fiscal offices, various years. Puerto Rico More than 20.0%, n = 2 10% to 19.9%, n = 9 0.1% to 9.9%, n = 5 Budget gap projected, amount unknown, n= 8 Not applicable or not reporting, n = 27

18 Budget Gap Numbers Past and Current Recession Past RecessionCurrent Recession Fiscal YearAmount (in Billions) Fiscal YearAmount (in Billions) 2002 $ $ $ $ $ $145.3* 2005 $ $65.1** 2006 $ $46.9** Total$263.8Total$386.8* Past Recession: March 2001 to November 2001 (8 months) Current Recession: Began December 2007 to present (21 months) *Preliminary figure ** Projected figure Source: NCSL survey of state legislative fiscal offices, various years.

19 Conclusion The states are facing a "cliff" once ARRA funding ends. State governments will face budgetary problems at least 12 months after the US recession ends. States are bracing for prolonged fiscal problems.

20 For more information


Download ppt "Fiscal Condition of the States Presentation to the Rhode Island House of Representatives Economic Forum December 1, 2009 Arturo Pérez Fiscal Affairs Program."

Similar presentations


Ads by Google