State budgets are still confronting challenges of the economic recession,...
State budgets are still confronting challenges of the economic recession, a report from the National Governors Association and National Association of State Budget Officers said. “Fiscal 2013 will likely be a turning point for state tax collections with general fund…
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revenues projected to surpass pre-recession levels for the first time since the onset of the recession,” it said Friday (http://xrl.us/bn6ifv), noting a projected 3.9 percent increase in revenue from 2012. But compared to 2008 levels, spending is down in 24 states. Many face “slow revenue growth and unrelenting expenditure pressures tied to high unemployment” and federal stimulus money that’s vanishing, it said. The fiscal cliff possibilities scare states: “Of greater concern to states now is the significant uncertainty surrounding federal tax and spending decisions, which could negatively impact the economy and federal funding for states.” General fund appropriations for fiscal year 2013 amount to $681 billion, 2.2 percent higher than fiscal year 2012’s $667 billion, but with a slower growth rate than the previous year. Budgets have begun to stabilize but are uncertain, the report said. Advocates for local and state government have tied the precipitous economy to telecom stakes and pointed to the tax exemption status of municipal bonds, which sometimes fund broadband projects, and controversial potential wireless and e-commerce sales taxes as financial necessities for municipalities, especially with a possible fiscal cliff looming in January (CD Nov 20 p2).