Most states are now wrapping up their 2013-2014 budget cycles, and apparently they're in good shape too. But thanks to the lack of budget transparency, state and local governments are estimated to owe up to $4 trillion more than they have set aside for pensions and retiree health care.

A new study shows that many states could end the current fiscal year with surpluses in their general funds. While that may seem like good news, it's probably too early to get excited. That's because those positive numbers are largely the result of one-time influxes of tax revenue that came when investors sold off assets late last calendar year to avoid higher federal tax rates that came in 2013.

"Nevada and all across the United States, cities and states that were once flush with cash are running out of money needed to pay for libraries, safe streets, clean drinking water, and yes, schools," writes analyst Meredith Whitney.

The decision on a new state budget in Maine may come down to a debate over the income tax.

A one percentage point increase in the unionization of a state’s public sector workforce is associated with an additional $78 of state and local government debt per capita. Meaning, if a state’s public sector unionization were to fall from 50% to 49%, that is associated with a fall in the public debt by $78 per person living in the state. Thus states with higher public sector unionized workforces are more likely to face higher levels of state debt. 

Comptroller Thomas DiNapoli gave mixed reviews Friday to the state budget passed last month amid New York's ongoing struggles with financial challenges following the national recession and massive storms.

Illinois had to pay a premium to sell some of its $800 million in municipal bonds Tuesday, a little more than two months after a credit-rating downgrade saw the state postpone a similar sale.

State Comptroller Kevin P. Lembo reported a $91.3 million deficit Monday in the state's chief operating fund, a $40 million improvement from the shortfall the comptroller projected one month ago.

Were California's state government a business, it would be a candidate for insolvency with a negative net worth of $127.2 billion, according to an annual financial report issued by State Auditor Elaine Howle and the Bureau of State Audits.

Washington state's budget shortfall grew by $300 million Thursday, primarily because the state miscalculated how much money it would save from moving certain Medicaid patients to managed care.

It is well understood that the federal government must make spending cuts-these cuts will most likely drastically change the amount of federal dollars that are allocated to the states. Unfortunately for most states, dependence on federal funding has continually risen since 2008.

Should Congress provide a bankruptcy option for states, or would bankruptcy be a mistake? The goal of this Article is to carefully vet this question, using all of the theoretical, empirical and historical tools currently available. The discussion is structured as a "case" for bankruptcy.

An analysis of the state constitutional debt provisions in California, New Jersey and Hawaii, and the debt that these states face in spite of those provisions.

The latest study by SBS reveals total state debt averages $13,754 for every American and $38,721 for each of the private sector workers in this country.

State Budget Solutions' second annual state deficit report reveals aggregate state debt presently exceeds $4 trillion. While states themselves can rely on budget gimmicks to hide the extent of the deficit, SBS takes a straightforward approach to calculating total state debt. See where your state ranks.

Aggregate state debt now exceeds $1.8 trillion, with much more potentially hidden off the official books.  As of 2009, total state debt averages almost $17,000 for each of the 107 million private sector workers in the United States.

Research by State Budget Solutions reveals the total official financial liability for each state according to the latest comprehensive annual data available. The research included total debt outstanding, recent budget shortfalls, pension and retirement health care liabilities, and Unemployment Trust Fund loans. The research also looks at the overall financial landscape for each state by considering top income tax rates, past economic performance, and economic outlook.

State Budget Solutions recommends that state legislators take action in 2013 to resolve the serious state financial crises by changing their focus from inputs to outcomes by redesigning budgets from the ground up based on priorities and performance.

The ongoing state budget "crisis" strongly underscores the urgent need for North Carolina to adapt significant state budget reforms, including putting North Carolina taxpayers back in charge of approving new debt, and forcing legislators and state agencies at reasonable intervals to justify all spending, not just spending increases.

States should use the budget solutions of avoiding budget gimmicks and use any additional revenue to first eliminate all the dubious financial devices from budgets and to avoid state debt.

North Carolina should limit non-voter-approved debt. Any further borrowing by the state should be subject to voter approval. It should also reform state employee pensions by moving to more portable and flexible benefits, such as a 401(k). State government should set aside reserves to cover future health care costs for retired state employees. Health Savings Accounts would be one solution and will remain an option at least until 2018, when the state will need to meet federal health insurance regulations.