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REVENUE

Revenue

Like any business or household, revenues play a critical role for states in determining their levels of spending. Nearly every state is constrained by a balanced budget amendment requiring their general fund expenditures not to exceed revenues (though budget games have allowed them to relax this constraint considerably). When times are tough, many legislators who loathe cutting programs turn to higher taxes as a way to increase revenue. However, as economist Arthur Laffer has shown, higher taxes do not always increase revenue. Minnesota, for example, has been driving high-earners (and their tax dollars) out of the state with its' unfriendly tax climate. Understanding the dynamics of taxation and state revenues is essential for anyone who seeks solutions to state revenue problems; SBS is here to help.

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    • HEADLINES: Pennsylvania

      Anemic tax collections add to state budget woes

      The Pittsburgh Post-Gazette | by Kate Giammarise | May 2, 2014

      Pennsylvania is facing an estimated budget shortfall of $1.3 billion through June 2015, according to a bleak revenue forecast issued by the state's Independent Fiscal Office.

    • HEADLINES: Connecticut

      Projected State Budget Surplus Collapses

      The Hartford Courant | by Christopher Keating | May 1, 2014

      Estimates of tax revenues down sharply in final week of budget negotiations.

    • HEADLINES: Colorado

      Colorado Governor Signs Budget With Increased Education Spending

      Businessweek | by Jennifer Oldham | May 1, 2014

      The budget, which includes federal funds, is about a 20 percent increase over the $21 billion allocated for fiscal 2014, which ends June 30.

    • HEADLINES: Massachusetts

      Massachusetts House approves $36B state budget

      The Boston Herald | May 1, 2014

      The Massachusetts House has passed a $36.2 billion state budget that would raise overall state spending by about 5 percent without new taxes and offers additional resources for the state's embattled child welfare agency.

    • HEADLINES: Illinois

      Gov. Quinn's Tax Pickle

      The Wall Street Journal | by Allysia Finley | April 30, 2014

      Gov. Quinn suggested that Chicago's impending pension crisis could be ameliorated by state revenue sharing. The city of Chicago and its schools have a combined $30 billion in unfunded pension liability.

    • HEADLINES: Hawaii

      Hawaii lawmakers approve $12B state budget for FY2014-15

      KHON2.com | April 30, 2014

      The budget, which provides $6.189 billion in general funds and $12.147 billion in all means of financing, was characterized by House Finance Chair Sylvia Luke as measured and prudent.

    • HEADLINES: Florida

      Lawmakers wrap up $75B state budget

      The Orlando Sentinel | by Aaron Deslatte and Jason Garcia | April 29, 2014

      With $1.3 billion in tax revenue to spare, Senate President Don Gaetz and House Speaker Will Weatherford still have to polish off the details of $500 million in tax cuts before the session adjourns Friday.

    • HEADLINES: Illinois

      Illinois residents paying more taxes for fewer services

      Illinois Watchdog | by Ben Yount | April 29, 2014

      "The pension obligation debt is eight times all the bond debt for building roads and schools and everything else," said Bob Williams, president of State Budget Solutions. "Essentially, the state has been living on credit cards."

    • HEADLINES: Georgia

      Gov. Deal signs election-friendly budget into law

      The Atlanta Journal Constitution | by Greg Bluestein | April 28, 2014

      The fiscal 2015 spending plan, a $20.8 billion blueprint which takes effect July 1, puts more than $300 million extra into schools with the goal of eliminating furloughs, lengthening the school year and giving teachers pay raises.

    • HEADLINES: Oklahoma

      Oklahoma House passes income tax cut legislation

      Businessweek | by Tim Talley | April 24, 2014

      House members voted 54-40 for the Senate-passed measure that is one of the session's top priorities for Republican Gov. Mary Fallin, who is seeking re-election. It now goes to Fallin to be signed into law.


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    • RESEARCH

      Federal Aid to the States 2008-2011

      by Kristen De Pena | February 21, 2013

      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.

    • RESEARCH

      Fiscal Policy Report Card on America's Governors: 2012

      The CATO Institute | by Chris Edwards | October 9, 2012

      This fiscal report card on the governors examines state budget actions since 2010 using statistical data to grade the governors on their taxing and spending records-governors who have cut taxes and spending the most receive the highest grades, while those who have increased taxes and spending the most receive the lowest grades.

    • RESEARCH

      2013 State Business Tax Climate Index

      The Tax Foundation | by Scott Drenkard Joseph Henchman | October 9, 2012

      The Tax Foundation's 2013 edition of the State Business Tax Climate Index enables business leaders, government policymakers, and taxpayers to gauge how their states' tax systems compare. The absence of a major tax is a dominant factor in vaulting many of these ten states to the top of the rankings.

    • RESEARCH

      State Budget Crisis Task Force Report

      State Budget Crisis Task Force | by Richard Ravitch and Paul Volcker | July 17, 2012

      State finances are not transparent and often include hidden liabilities as well as rapidly growing responsibilities which are difficult to control.  While state revenues are gradually recovering from the drastic decline of the Great Recession, they are not growing sufficiently to keep pace with the spending required by Medicaid costs, pensions, and other responsibilities and obligations.  This has resulted in persistent and growing structural deficits in many states which threaten their fiscal sustainability.

    • RESEARCH

      Spring 2012 Fiscal Survey of States

      States will face particularly intense budgetary challenges in education and health care in fiscal 2013, putting pressure on all budget areas - including corrections and infrastructure. As budgets face strain from slow revenue growth and expenditure pressures, states will likely confront tough budgetary choices in the next fiscal year.

    • RESEARCH

      Rich States, Poor States

      ALEC American Legislative Exchange Council | by Arthur B. Laffer, Stephen Moore and Jonathan Williams | April 12, 2012

      This fifth edition of Rich States, Poor States provides 50 unique snapshots from our "laboratories of democracy" for you to evaluate. Study the rankings, read the evidence, and learn about the proven principles that lead to economic growth, job creation, and a higher standard of living for all Americans.

    • SOLUTIONS

      How Reality-Based Budgeting Can Permanently Resolve State Budget Gaps

      State Budget Solutions | by Bob Williams | November 7, 2012

      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.

    • SOLUTIONS: New York

      The Case for a Cap

      The Empire Center | December 7, 2011

      This report analyzes the tax cap proposal in light of previous efforts to limit property taxes in New York and other states. Among the findings, New York's local property tax levels are exceptionally high by national standards and have grown by more than double the inflation rate over the past decade, justifying the governor's push to limit future growth.

    • SOLUTIONS: Georgia

      Eight Affordable Ideas for Georgia

      The Georgia Public Policy Foundation | by Eight Affordable Ideas for Georgia | December 2, 2011

      Georgia should continue to push the reforms that have made this one of the best managed states in the nation, but innovation is the best opportunity for true reform. Tax, regulatory and tort reform will create the right conditions for innovation in the private sector while the state pursues innovation in the areas of criminal justice, education and heath care.

    • SOLUTIONS: North Dakota

      Moving Forward

      The North Dakota Policy Council | November 29, 2011

      A guide to needed reforms in pensions, taxes and higher education, among other areas, with  two types of goals that are important when working towards limiting government: long-term policy objectives that show the end-game goals and short-term policies that steer public policy towards the long-term goals. This guide provides both.

    • SOLUTIONS: Nevada

      One Sound State, Once Again

      The Nevada Policy Research Institute | by Geoffrey Lawrence | November 3, 2011

      Nevada seriously needs genuine, revenue-neutral fiscal reforms, and this report seeks to fill that vacuum. It analyzes the actual volatility of Nevada's current taxes - and the taxes lawmakers keep signaling they want. It covers important tax-related issues, such as achieving economic efficiency and tax equity, while reducing compliance costs as well as tax-induced distortions in economic behavior. It advocates implementing priority-based budgeting.

    • SOLUTIONS: Oregon

      How to Turn Oregonís Business Climate Around

      The Cascade Policy Institute | by Steve Buckstein | November 3, 2011

      Article presenting the elimination of the Oregon state income tax and the end forced unionism as solutions to both budget problems and lack of business growth.

    • SOLUTIONS: Nebraska

      Pro-Growth Strategy for Nebraska

      The Platte Institute | by Eric Thompson | September 1, 2011

      This report focuses on limiting the regulatory burden in the state and other types of recommendations to improve growth.

    • SOLUTIONS: Illinois, California, Texas

      Amazonian-Size Taxes

      by Kristen De Pena | July 11, 2011

      Proposals to tax Internet retail sales are all the rage as states continue to look for more ways to balance their budgets in the face of revenue shortfalls.

    • SOLUTIONS

      Rich States, Poor States 2011

      Bloated state spending levels and trillions of dollars in unfunded government employee pension liabilities pose huge financial obstacles to economic recovery in the 50 states today. This begs the million-or trillion-dollar question: Why are some states prospering while others are still struggling?

       

       

       

       

    • SOLUTIONS: Texas

      Texasí Fiscal Future

      The Texas Public Policy Foundation | by Arthur B. Laffer | April 1, 2011

      There has been an impression created in the press and embraced by many that the LBB report suggests that adoption of the bill CSHB1 by Texas would cost Texas 272,000 jobs in 2012 and 335,000 jobs in 2013. This answer, at least as interpreted by the press, is wrong and not based on sound economics. The passage of CSHB1 will not cause less jobs in Texas relative to any other option at hand.