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The Nelson A. Rockefeller Institute of Government

State and Local Finance: Archive

State and Local Finance Archive

The New Normal: Government Working More Efficiently

State governments saw their worst revenue declines in five decades, Institute Senior Fellow Donald Boyd told a conference of the Pew Center on the States, in this presentation. And the slow economy recovery means revenue growth is likely to be modest for states. Boyd then asked: Is this the right environment for tax reform? His analysis includes some practical considerations.
Donald J. Boyd, December 11, 2010

National Trends in State and Local Government Employment and Finances

Though tax revenues are stabilizing, states face a number of continuing fiscal challenges, including the disappearance of federal stimulus dollars and substantial increases in health care and pension costs. More cuts in state and local government are likely on the horizon, he said.
Donald J. Boyd, December 7, 2010

State Tax Revenues Rebound Further, Growing For Third Straight Quarter

States’ tax revenues rose for a third consecutive quarter, continuing the reversal of a downward trend that has devastated state budgets, according to preliminary data in this report. States’ overall tax collections increased by 3.9 percent nationwide in the third quarter of 2010, compared to the same period a year earlier, based on data from 48 states. Despite the improved collections in July-September 2010, however, revenues remain significantly below peak levels and are still weak in a number of states, the report shows.
Lucy Dadayan and Donald J. Boyd, November 30, 2010

State Revenue Report #81: Revenue Now Growing in Most States;
Sales Tax Gains 5.7 Percent in 2nd Quarter

The second quarter of 2010 represented the second period in a row that states reported overall gains in tax collections — following five straight quarters of decline — according to this study. Overall state tax revenues grew by 2.3 percent in the second quarter of 2010, according to the Institute’s latest State Revenue Report. Thirty-four states reported gains in revenue during the second quarter, with 12 showing double-digit growth. The two-quarter trend has begun to reverse the overall declines reported by states from the fourth quarter of 2008 through the end of 2009.
Lucy Dadayan and Donald J. Boyd, October 2010

State Tax Revenues Are Slowly Rebounding: Two Straight Quarters of Growth, But Total Collections Are Still Below Prerecession Levels

Tax collections for states across the country rose by 2.2 percent in April-June, the second consecutive quarterly increase, according to preliminary data in this “flash” report. Sales tax revenues were particularly strong, rising 5.9 percent compared to a year earlier. Yet revenues remain sharply below prerecession levels.
Lucy Dadayan and Donald J. Boyd, August 30, 2010

State Tax Revenues Are Slowly Rebounding: Two Straight Quarters of Growth, But Total Collections Are Still Below Prerecession Levels

Tax collections for states across the country rose by 2.2 percent in April-June, the second consecutive quarterly increase, according to preliminary data in this “flash” report. Sales tax revenues were particularly strong, rising 5.9 percent compared to a year earlier. Yet revenues remain sharply below prerecession levels.
Lucy Dadayan and Donald J. Boyd, August 30, 2010

After Disastrous 2009, States Report Modest Revenue Growth in Early 2010

States’ total tax revenues rose in the first quarter compared to last year, marking the first such gain since the third quarter of 2008, according to this Institute report. But most states still saw tax collections drop, and early data suggest the second quarter may be weaker. Overall revenues still lag behind pre-recession levels.
Lucy Dadayan and Donald J. Boyd, July 2010

Overall State Tax Revenue Is Up, But Losers Still Outnumber Gainers

States’ overall tax revenues rose in the first quarter of calendar 2010 on a year-over-year basis, marking the first such gain since the third quarter of 2008, according to preliminary data in this Institute report. Despite the overall growth in revenues, a majority of states still saw declines. Further, early indications of revenues in the April-June quarter are not promising.
Lucy Dadayan, June 3, 2010

State Fiscal Trends and the Federal Role

A House subcommittee requested the Institute’s expertise on current fiscal trends, as part of an inquiry into the impact of federal legislation on state and local government revenues. Deputy Director Robert Ward said state leaders “now face budget choices that are more difficult than any since the Great Depression.”
Robert B. Ward, April 15, 2010

Revenue Declines Less Severe, But States’ Fiscal Crisis Is Far From Over

A decline in states' tax collections for the fifth straight quarter suggests a long, slow fiscal recovery ahead, according to this State Revenue Report. While the decline in the final quarter of 2009 was not as steep as in previous quarters, preliminary figures for early 2010 show continued weakness.
Donald J. Boyd and Lucy Dadayan, April 2010

Final Quarter of 2009 Brought Still More Declines in State Tax Revenue

State tax collections fell for the fifth straight quarter on a year-over-year basis, but the decline during October-December 2009 was not as sharp as those during the three preceding periods, according to preliminary data in this Institute “flash” report on state finances. A few states are now seeing modest revenue growth.
Lucy Dadayan, Feb. 23, 2010

Recession, recovery, and state-local finances

In this presentation to the Forecasters Club of New York, Senior Fellow Donald J. Boyd examined the financial pressures faced by state and local governments as recession rolls into economic recovery. His talk included an analysis of the question, “Why won’t economic recovery feel like fiscal recovery?” His answer included the impact of federal stimulus funds, perception and policy choice.
Donald J. Boyd, January 28, 2010

Recession or No Recession, State Tax Revenues Remain Negative

State tax collections for the third quarter of 2009 showed a double-digit decline from the previous year — for the third consecutive quarter, according to this State Revenue Report. Negative revenue numbers remained widespread, with 48 states seeing total tax collections fall during the quarter on a year-over-year basis. The number of states reporting double-digit declines fell, however, from 36 states in the preceding quarter to 22 in the third quarter. Revenue fell most sharply in Western states, with Eastern states experiencing more moderate declines in collections.
Lucy Dadayan and Donald J. Boyd, January 2010

State/Local Employment Up Slightly Since Start of Recession,
But Cuts Are Now Underway

Combined state and local government employment across the U.S. has increased slightly since the recession began in December 2007, while jobs in the private sector have dropped sharply, according to a new report from the Rockefeller Institute of Government. During the past year, total state- and local-government employment rose in 30 states and declined in 16, with employment in the remaining states unchanged. Since the recession began, state and local governments have added a total of about 110,000 jobs, an increase of 0.6 per cent.
Donald J. Boyd, August 20, 2009
Read the News Release

State Tax Revenue Declined Sharply in Fourth Quarter

Last year ended badly for states, and the first part of 2009 looks to be even worse, according to the Rockefeller Institute’s latest “flash” report on state revenues. Three-quarters of states reporting saw tax collections drop at the end of 2008, compared to the same quarter of 2007. Overall, states' revenues fell 3.6 percent in the quarter.
Lucy Dadayan and Donald J. Boyd, March 2009
Read the News Release

Stability and Volatility in New York’s Income Tax

As New York State legislators considered proposals to raise the income tax on high-income earners, Rockefeller Institute Senior Fellow Donald J. Boyd testified before the state Senate’s Select Committee on Budget and Tax Reform. Boyd noted that tax policies inevitably involve “trade-offs,” and said the bills would raise billions for spending that could benefit the economy, but could also fuel undesirable year-to-year revenue swings.
Donald J. Boyd, March 12, 2009

State Revenue Report #74: State Tax Revenue Falling Sharply in Fourth Quarter, Early Data Show

Fiscal conditions in the states worsened dramatically in the last quarter of 2008, according to preliminary data analyzed by the Rockefeller Institute of Government. Total tax collections during the quarter declined more than 4 percent from the previous year, based on available data. The forecast for early 2009 looks similarly bleak.
Donald J. Boyd and Lucy Dadayan, January 2009
Read the News Release

Presentations to the Council of State Governments

Rockefeller Institute Senior Fellow Don Boyd analyzed “Recessions and State-Local Finances”, with updated data on state-level economic conditions, during the Council of State Governments’ summer forum for legislative fiscal leaders in Western states. Senior Policy Analyst Lucy Dadayan examined “Ten-Year Trends in Gambling Revenue to the States” for CSG's Eastern Regional Conference.
Donald J. Boyd, July 18, 2008; Lucy Dadayan, August 12, 2008

From a Bonanza to a Blue Chip? Gambling Revenue to the States

For more than two decades, states saw lotteries and casinos as a bonanza of new dollars for education and other programs. Gambling revenue is now at an all-time high, but growth is slowing due to objections about social impacts and broader economic trends. And the report shows that states vary widely in their reliance on gambling revenues.
Lucy Dadayan, Nino Giguashvili, and Robert B. Ward, June 19, 2008
Read the News Release

The Effects of State-Level Tax and Expenditure Limitations on Revenues and Expenditures

This paper describes state-level tax and expenditure limitations (TELs) in 31 states, notes how their spread has slowed in recent years, and summarizes earlier studies of their effects on state and local revenues. The report also presents new findings from the authors’ analysis of the effects of TELs. These new findings indicate that TELs have different effects on certain areas of spending, and on certain types of revenue sources.
Suho Bae and Thomas Gais, May 2007

Governors Stress Similar Themes in Annual Messages

Activism on the move by governors, challenging the status quo. The Rockefeller Institute reviewed the annual messages of 13 governors, representing a cross-section of states where the governor has already released a message, to gauge their priorities for the upcoming year or years.
Brian T. Stenson and Alison J. Grinnell, February 2007

Impact of Proposed 2007 Federal Budget Actions on States

President Bush's budget proposal would reduce many domestic grant programs and diminish state tax collections, with significant impacts on state budgets. The outlook is for federal budget actions to have a limited impact on state budgets in the near term. However, over the longer term, states should anticipate significant pressure from constrained federal spending as Washington grapples with the ballooning deficit.
Donald J. Boyd, May 2006

Rising Energy Prices May Not Be a Windfall for All Government Budgets

Rising prices for gasoline and other petroleum-based products pose complex, often contradictory, issues for state and local governments. While many believe that collections from taxes on gasoline are surging, most taxes are not sensitive to the price consumers pay at the pump. And government programs are bearing the higher cost of petroleum products.
Brian Stenson, May 2006

The 2001 Recession Continues to Affect State Budgets

While states' overall recovery has been solid and widespread, significant ongoing pressures persist.
Donald Boyd, April 2006

Retiree Pensions and Health Benefits: State and Local Governments Face New Budget Challenges

Examining the significant pressures on states to strengthen pension systems and finance retiree health care.
Donald Boyd, April 2006

Solid Footing for State Finances: Fiscal Year 2005 Tax Revenue Summary

State general fund tax revenue grew 10.7 percent from fiscal year 2004 to fiscal year 2005, marking the second consecutive fiscal year of solid revenue growth after the sharp decline in fiscal year 2002 and sluggish growth in fiscal year 2003. After adjusting for legislated tax changes and inflation, tax revenue grew 5.2 percent, the third strongest adjusted real state tax growth since 1991.
Nicholas W. Jenny, March 2006

Four State Budget Plans Show Disparate Fiscal Pictures

Budget proposals submitted by governors of Florida, Illinois, Michigan, and Pennsylvania represent disparate states — some with surging revenue and new money, and some still struggling with stagnant revenue growth and structural deficits. As a result, the governors’ budget recommendations show marked differences in the extent to which they advance costly initiatives.
Patricia L. Billen and Brian T. Stenson, March 2006

Governors' Budgets Reflect Strong Revenue Growth

With state tax collections surging, budget proposals submitted by governors are revealing their priorities for dealing with surpluses. Budgets advanced by the governors of AZ, CA, CT, MD, and MA are emphasizing tax cuts, education funding, and replenishing budget reserves.
Brian T. Stenson, February 2006

2005 Tax and Budget Review

Continued strong revenue growth put states in a more stable position in 2005 than at any time since the end of the 2001 recession. For the first time since 2000, states enacted net tax cuts, suggesting a transition from the post-recession period of tax increases toward tax cuts.
Nicholas W. Jenny, January 2006

Governor Pataki Presents 2006-07 Executive Budget

New York State Governor George Pataki presented his 2006-07 Executive Budget on January 17, 2006. Budget projections indicate an improving fiscal outlook, with a current year surplus of almost $2 billion. The governor proposes a General Fund spending increase of 5.1 percent, Medicaid cost containment, and $3.5 billion in tax cuts phased in over three years.
Brian T. Stenson and Nicholas W. Jenny, January 2006

Fast Fact: Most Southern States Rely Heavily on State and Local General Sales Taxes

Rockefeller Institute Fast Fact, 2005

Fast Fact: States Rely Heavily on Federal Grants and Local Governments Rely Heavily on State Grants

Rockefeller Institute Fast Fact, 2005

New Census Data Offer Glimpse of States' Early Responses to the Fiscal Crisis

States increased tuition and other fees and charges, and reduced capital spending in 2003 to offset a second consecutive year of tax revenue declines. Real per capita Medicaid-related payments rose sharply, leading overall spending to rise despite a decline in other areas, suggesting that Medicaid may have crowded out other spending.
Donald Boyd, April 2005

State Budgets: Recent Trends and Outlook

Tax revenue fell so sharply during the recent fiscal crisis — 10 percent between fiscal year 2000 and 2003, adjusted for inflation, population growth, and legislated tax changes — that despite economic recovery and recent tax increases, it remains below its prior peak in 70 percent of the states. States buffered the initial shock of revenue decline by drawing down fund balances and tapping nonrecurring revenue sources, which allowed states to push some of the problem off to future years.
Donald J. Boyd, in The Book of the States 2005 (The Council of State Governments, 2005)

State Finances Begin Recovery: Fiscal Year 2004 Tax Revenue Summary

State tax revenue grew 7.5 percent in fiscal year 2004. This was the best fiscal year since 2000. Net legislated tax increase added $8 billion to state revenue in fiscal year 2004.
Nicholas W. Jenny, February 2005

State Finances: Improvement, But Pressures and Risks

Despite improving revenue growth, many states face difficult fiscal choices as tax revenue remains well below its prior peak and cost pressures continue in Medicaid, elementary and secondary education, and other spending areas.
Donald J. Boyd, presented at the National Federation of Municipal Analysts Advanced Seminar on Tax-Backed Debt,Orlando, FL, January 13, 2005

State and Local Governments Face Continued Fiscal Pressure

State and local governments face fiscal risks from a possible overhaul of the federal tax system and spending pressure from Medicaid and other programs.
Donald J. Boyd, January 2005

2004 Tax and Budget Review

Eight states enacted significant tax increases in 2004, raising $2.6 billion dollars annually.
Nicholas W. Jenny, November 2004

Federal-State Fiscal Relationships In The United States: Implications for Border States

Border states will have many federal-state fiscal issues to contend with in coming years: (1) Protecting Medicaid reimbursements and perhaps making relative gains, in a period in which the federal government will need to make cuts; (2) Protecting other grant revenue from likely federal cuts; (3) Looking out for state-local interests during a potential tax-reform debate; (4) Dealing effectively with NCLB and other federal “quasi-mandates.”
Donald J. Boyd, presented at the Council of State Government's Border Legislative Conference: IX Legislative Forum, Hermosillo, Sonora, Mexico, November 19, 2004

State Finances: Not Out of the Woods Yet

While the economy is recovering, states are still struggling.
Donald J. Boyd, presented at the Federation of Tax Administrators (FTA) Revenue Estimation Conference, Burlington, VT, September 20, 2004.

State Tax Revenue Continues Strong Growth

State tax revenue increased by 8.4 percent year-over-year in the July-September 2004 quarter, according to preliminary data.
Nicholas W. Jenny, November 2004

Strong Finish for Many States' Fiscal Years

State tax revenue, adjusted for legislated tax changes, increased by about 6.7 percent year-over-year in the April-June 2004 quarter.
Nicholas W. Jenny, August 2004

State Prison-Building Boom May Be Over, But Spending on Prison Operations Continues to Grow

States increased per capita prison expenditures by 10 percent from 1996 to 2001.
Lucy Dadayan, July 2004

K-12 Education Still Growing Strongly

According to recently released 2002 data, state and local governments increased current spending on elementary and secondary education by 39 percent between 1997 and 2002 — a period before the state fiscal crisis hit. Even after adjusting for inflation and growth in pupil enrollment, spending grew by nearly 17 percent.
Donald J. Boyd, June 2004

State Personal Income Tax Recovers

After two years of decline, state personal income tax revenue grew by 6.4 percent in the January-March 2004 quarter.
Nicholas W. Jenny, May 2004

State Tax Revenue Growth Gains Momentum

State tax revenue increased in the January-March 2004 quarter. Underlying state tax revenue growth is finally reaching pre-recession levels.
Nicholas W. Jenny, May 2004

Challenges for Financing Public Higher Education

Diminishing support from state governments has triggered significant increases in tuition and fees at public institutions. Meanwhile, many studies predict that the number of high school graduates will continue to increase. These and other problems bring into question the state governments’ ability to finance public institutions as less expensive alternatives to private higher education.
Nicholas Jenny and Emrah Arbak, March 2004

State Tax Revenue Continues Slow Improvement

State tax revenue increased in the October-December 2003 quarter. This is the second straight quarter of adjusted real growth, though it is still rather weak.
Nicholas W. Jenny, February 2004

A Sluggish Year: Fiscal Year 2003 Tax Revenue Summary

State tax revenue declined in fiscal year 2003 in the second weakest showing since 1991. This marks the second straight year of decline.
Nicholas W. Jenny, February 2004

Is the State Fiscal Crisis Over? A 2004 State Budget Update

This paper, which updates a September 2003 analysis by the Rockefeller Institute of Government for the Kaiser Commission on Medicaid and the Uninsured, finds that although the state fiscal situation is improving, states are by no means out of the woods yet.
Donald Boyd and Victoria Wachino, Kaiser Commission on Medicaid and the Uninsured Issue Paper, January 2004

State and Local Finance Archive (Pre-2004)