CONNECTICUT Governor Rell announced that the legislature will convene five days early in January to vote on the new budget. Connecticut has a mid-year shortfall of $356 million.
Rell to state: Cut More - Republican American - December 9Amid preparations for a new two-year budget proposal, Governor Rell sent budget requests back to the state's agencies, boards, and commissions, asking them to make further cuts. Rell's budget analysts estimate a $356.3 million shortfall for the 2009 fiscal year, and have projected a $6 billion deficit over the next two fiscal years. The governor will present the new budget plan to the state's General Assembly in February.
DELAWARE Governor-elect Jack Markell held a town hall meeting to hear ideas from state employees about how to close Delaware's budget gap.
As Deficit Widens, State Finds Ways to Close Gap - News Journal - December 16Moving a Medicaid payment from the last day of the month to the first will help close the state's FY2009 budget gap, although it shifts the payment to FY2010 and increases the coming budget deficit to $560 million.
Business Leaders Offer Markell Tips - News Journal - December 4Governor-elect Markell met with the Delaware State Chamber of Commerce to get suggestions on how to support state businesses, create jobs, and grow public-private partnerships. Drawing on methods employed by President-elect Obama's meeting with the country's governors, Markell asked business leaders to give specific recommendations to improve the state economy. The meeting produced a laundry list of proposals for consideration, among them a revised RFP process, opportunities for state defense contractors to win upcoming federal projects, and regional partnerships to be positioned more competitively.
Outlook for Del. Economy in '09 Dim - News Journal - December 3The Federal Reserve Bank of Philadelphia painted a bleak economic picture in 2009. The state's leading measure of economic activity was at the lowest monthly point in its 29-year history, with -3.4% growth for October. The index also posted -2.4% growth over the last year, the worst 12-month measure since the Philly Fed started tracking trends in the state's GDP. Pennsylvania and New Jersey's leading indices for October were -0.6% and 0.7%, respectively. An analyst with the Fed included the caveat that the index could be unpredictable in a smaller state such as Delaware.
MAINE Maine Budget Cuts Outlined - Boston Globe - December 16Governor Baldacci seeks to close a budget gap of more than $140 million with job cuts, tax law changes, and borrowing against the state's rainy day funds. The state must still find ways to minimize the FY2010 two-year budget shortfall of $838 million.
MASSACHUSETTS
A pay increase for 30,000 human services employees has been postponed indefinitely by the Patrick administration. Most of the workers make around $25,000 per year; the raise amount would total about $23 million.
Forecast Deepens Fiscal Gloom - Boston Globe - December 16The state's Department of Revenue says tax revenues will decline by $750 million, raising the total mid-year budget gap to an estimated $2.1 billion. Massachusetts already closed a $1.4 billion gap in October without cutting any local funds, but is unlikely to avoid such cuts in this second pass.
A Gambling Problem: Mass. Might Take Pass - Union Leader - December 15Governor Deval Patrick is withdrawing his own proposal to develop three additional casinos in the state, citing the recession.
Patrick Admits State Budget Leaner Than He Thought - Associated Press - December 4In his monthly radio broadcast, Governor Patrick said that "there's nowhere the amount of fat that people think there is" in the state budget. Patrick said he would consider raising the 23.5 cents-per-gallon gasoline tax as part of a reform of the state's transportation programs.
NEW JERSEY Corzine Looking for Another $1.2B to Cut from Budget - NorthJersey.com - December 17Governor Corzine said the state will probably need to find more than $1.2 billion in spending cuts to close the FY2009 budget shortfall, since tax revenues were $459 million below expected for the first five months of the year. The state has already located $400 million in cuts and will need to find an additional $800 million by next month.
N.J. Bills Would Allow Ads on School Buses to Fund Education - Star-Ledger - December 15State legislators have put up at least three bills since January to allow school districts to raise money using their school buses as ad space.
NEW YORK
While increasing income taxes on the wealthy has been a budget-balancing method of last resort, Governor Patterson says it may become a necessity.
New York is among a list of states whose economy includes a structural deficit, where its revenue regularly falls short of service expenses. Downturns such as the current recession can be an opportunity to examine states' tax structures.
Paterson Proposes Austere Budget to Close Deficit - New York Times - December 16In an attempt to close an estimated $15 billion budget deficit, the largest in New York's history, Governor David A. Patterson proposed 137 new taxes and fees (including on sugary soft drinks), fewer gambling restrictions, and $9 billion in spending cuts.
New York Pays Back $800 Million in Business Tax - New York Times - December 1While New York City has already had to pay out $800 million in prepaid taxes to local companies, Albany paid out $1 billion in corporate refunds during the first 10 months of 2008. As a result of the financial crisis, corporations that had prepaid their taxes for the year based on estimates of better performance are recalling those funds now. The refunds compound an already bleak budget situation in the state.
PENNSYLVANIA
An audit commission disclosed the surplus, followed immediately by calls to release the money into the state's general fund.
Rendell Blasted for Eyeing 'Green' Funds - TheMorningCall.com - December 12Governor Rendell received a letter from 14 state environmental groups opposing his proposal to use funds intended for state conservation programs to close the growing budget gap.
Rendell Unveils His Plan to Deal with Rising Deficit - Pittsburgh Post-Gazette - December 10Governor Ed Rendell presented a six-point proposal aimed at reducing the state's deficit, which stood at $658 million as of November 30th and was projected to reach $1.6 billion by fiscal-year end. Rendell proposed using half of Pennsylvania's rainy day fund ($375 of $750 million); asking the federal government for $450 million; cutting $464 from state agencies directly under his control and $36 million from agencies not directly under his purview; using $101 million in "lapses," or funds that remain unspent from previous-year budgets; and appropriating $174 million in shale revenues from companies leasing underground lands from the state.
Fiscal Woes Zap 13,600 State Raises - Patriot-News - December 4Freezing salaries for the rest of the fiscal year for 13,600 managerial and other non-union state workers will save $14.3 million.
RHODE ISLAND
Legislators are considering enforcing taxes on goods and services currently excepted from the state's 7% sales tax.
The agreement would establish a $12 billion spending limit on the state's Medicaid program over a five-year period. In exchange for placing the limits, which will save the federal government funds, Rhode Island would receive more flexibility in determining how to spend its Medicaid funding.
The Governor-appointed panel presented preliminary recommendations aimed at restructuring the state's tax codes, including reducing the state's corporate income-tax rate, eliminating business-related tax credits, reducing the number of tax brackets for individuals, and changing the treatment of capital gains income.
A Shortage of Answers on the Budget Deficit - Providence Journal - December 3
The House Finance Committee questioned state department heads about spending beyond their budget targets. Departmental overspending accounts for $80 million of the $357 million mid-year budget shortfall. VERMONT Governor Douglas is maintaining his resistance to higher taxes after a series of legislative hearings from constituents who would be affected by raising tax rates.
Legislators to Weigh Variety of Budget Cuts - Rutland Herald - December 16Lawmakers consider a variety of cuts to General Fund appropriations, including reducing financial aid at the University of Vermont, eliminating chiropractic coverage, and eliminating staff in the state treasury office.
State Mulls Education Money to Pay for Roads - Associated Press - December 11Vermont's tax commissioner projects a $20 million education fund surplus for next year. Governor Jim Douglas is thinking about applying the funds to infrastructure projects, but opponents think it should be used to reduce property taxes.
