Budget Processes and Systems

There are many ways to approach drafting and states are learning the hard way that many of their attempts have been unsuccessful.  State Budget Solutions believes that zero-base budgeting is the solution. In its original form, it is a system of budgeting that begins every budget cycle at zero, rejecting any assumption that the activities that were funded in the last budget will continue in the coming one. It requires a rationale for each activity that will be funded for the new budget. It is intended to foster analysis of every activity, prioritization of budget activities, cost-effectiveness and economy.  This section has information on zero-base budgeting and also covers different aspects of the budget process, including annual versus biannual budgets.

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    • HEADLINES: New Mexico

      House sends state budget bill back to committee | by Barry Massey | February 13, 2014

      A $6 billion budget proposal was sent back to a New Mexico House committee Wednesday for possible revisions to try to break a stalemate over education spending.

    • HEADLINES: Alaska

      Alaska budget officials grilled on 10-year plan

      The Anchorage Daily News | by Becky Bohrer | February 11, 2014

      Members of the House Finance Committee grilled Alaska state budget officials Monday on how realistic their 10-year budget plan is.

    • HEADLINES: Pennsylvania

      At a time of surpluses elsewhere, Pennsylvania faces deficit

      Washington Post - GovBeat | by Reid Wilson | February 10, 2014

      After years of harsh budget cuts, the economic recovery has meant good news for states reaping the benefits of rebounding tax revenue. California has a $4.2 billion surplus. New York has $2 billion in extra cash. Across the country, state revenue is up 3.8 percent over last year, according to the National Association of State Budget Officials.

      But in Pennsylvania, the picture isn’t as rosy.

    • HEADLINES: Illinois

      Illinois lawmakers bypass reluctant Quinn on massive budget shortfall

      Illinois Watchdog | by Ben Yount | February 6, 2014

      "The governor is asking for a delay, but here in the House we are not asking for a delay. We're going to move forward," House Speaker Mike Madigan said Tuesday.

    • HEADLINES: Illinois

      Quinn wants to delay budget speech

      The Chicago Tribune | by Ray Long | February 4, 2014

      Instead of unveiling his budget on Feb. 19 as provided by law, Gov. Pat Quinn wants to hold off until March 26, the week after the primary.

    • HEADLINES: Arizona

      Brewer, budget committee release conflicting budgets

      Arizona Republic | by Alia Beard Rau | January 27, 2014

      Gov. Jan Brewer and legislative economists over the past week released conflicting budget predictions for the next three years, setting the stage for a battle over Arizona’s future.

    • HEADLINES: Washington

      New state budget may not be needed, says Ways & Means chair

      The Seattle Times | by Andrew Garber | January 23, 2014

      Senate Ways and Means Chairman Andy Hill said he's not sure the Legislature needs to pass a state operating budget this year. Democrats, who control the House and governor's office, disagree.

    • HEADLINES: Missouri

      Official says eight-month state budget is an option

      The Springfield News-Leader | by Jonathan Shorman | January 14, 2014

      An abbreviated budget would be designed to combat budget withholding by Gov. Jay Nixon, a Democrat. Senate Appropriations Chairman Sen. Kurt Schaefer, a Republican, said Nixon's withholds create "tremendous" uncertainty.

    • HEADLINES: Ohio

      Ohio lawmakers' 2014 agenda includes budget changes, tax overhauls | by Jeremy Pelzer | January 2, 2014

      For the Ohio General Assembly, 2014 is shaping up to be a year where economic issues will be at the fore, from tweaking the state budget to proposed changes to severance and local income taxes.

    • HEADLINES: Virginia

      State budget: little wiggle room, much wiggling expected

      Daily Press | by Dave Ress | December 16, 2013

      Nobody was expecting much wiggle room in the state's next budget, but on his way out the door, Gov. Bob McDonnell wriggled free a boost in spending on mental health and higher education, as well as money for a slavery museum.

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    • RESEARCH: Delaware

      Delaware’s Public Employees’ Retirement System: A Complete and Transparent Accounting

      The Mercatus Center | by Eileen Norcross | March 21, 2013

      To be fully funded, Delaware must increase its annual contribution to the pension system based on a market valuation of plan liabilities. This paper analyzes Delaware’s pension system on a fair-market or government- guaranteed basis, with reference to the average US Treasury rate on 10- and 20-year bonds in June 2012. A discussion of the discrepancy between current government accounting conventions and the fair-market value approach and the implications for plan management follows.


      Performances measurements used by states

      State Budget Solutions | March 18, 2013

      The accountability measurements identify societal goals and iterates specific means of achieving them. While many states list specific goals they want to attain and the means to measure the goals, there is still little accountability for failure to reach stated goals. The measures in place are primarily numerical. By comparing rates and statistics annually, each state can determine the success of the specific tactics used to attain the accountability measures. No states compare their own success with that of neighboring or similarly situated states.


      Municipal Bankruptcy: An Overview for Local Officials

      This guide serves as an overview of the basics of municipal bankruptcy, and boils down the municipal bankruptcy process so that officials and citizens have a framework within which to discuss whether bankruptcy is a viable option. It outlines who, what, where and when, as well as costs and benefits.


      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.


      Forecasting the Recovery from the Great Recession: Is This Time Different?

      The National Bureau of Economic Research | by Kathryn Dominguez & Matthew Shapiro | February 4, 2013

      Was the slow recovery of the U.S. economy from the trough of the Great Recession anticipated? 


      On Financing Retirement with an Aging Population

      The National Bureau of Economic Research | by Ellen McGrattan & Edward Prescott | February 4, 2013

      Alternative views on the problem the United States is facing: financing retirement consumption as its population ages.


      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.


      The Fiscal Health of U.S. States

      Mercatus Center | by Jeffrey Miron | August 15, 2011

      This paper examines the fiscal health of the 50 U.S. states. As this paper shows, accounting for implicit pension liabilities provides a significantly more negative picture than does explicit debt information on its own.


      Are Biennial Budgets Better?

      by Bryan Leonard | April 18, 2011

      The comparison of biennial and annual budgets recently made headlines thanks to Iowa Governor Terry Branstad, who vetoed a spending bill that only appropriated funds for one year and instead is insisting on bills that plan for two years of spending. Brandstad is adamant that a biennial budget is critical to creating responsibility, but are biennial budgets really so much better?


      Annual and Biennial Budgeting: The Experience of State Governments

      The National Conference of State Legislatures | by Ronald K. Snell | April 14, 2011

      The trend among state governments for the past 70 years has been to abandon biennial budgeting for annual budgeting. Forty-four states practiced biennial budgeting in 1940. Twenty will do so in 2010, when Arkansas turns from biennial to annual budgeting (Arkansas is reported as an annual-budgeting state in this report in anticipation of the change). There are several reasons for the shift to annual budgeting, but in general the shift has been part of the resurgence of state legislative power since the middle of the century.


      The State Budget Process for the Lay Person

      by Bob Williams | December 17, 2012

      An introduction to how the state budget process works and a glossary of terms used in the process.


      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: North Carolina

      A Blueprint for Budget Reform

      Civitas Institute | by Brian Balfour | September 12, 2012

      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.

    • SOLUTIONS: New Hampshire

      On Highways, The One Good Idea in Washington

      The Josiah Bartlett Center for Public Policy | by Charles M. Arlinghaus | December 7, 2011

      Highway spending in New Hampshire is not funded by general taxation. Our highway spending is supported entirely by user fees like the gas tax and turnpike tolls. So, if we're developing a real plan, let's start by figuring out how much money those fees will raise over the next ten years.

    • SOLUTIONS: Pennsylvania

      Reality-Based Budgeting

      Commonwealth Foundation | by Bob Williams, Matthew J. Brouillette | December 7, 2011

      This is the year to resolve Pennsylvania's serious financial crises by changing the budget focus from inputs to outcomes. In other words, legislators and the governor should junk the old conventional model and start designing a reality-based budget from the ground up based on priorities and performance.

    • SOLUTIONS: Virginia

      Focus on Results for Smarter Government Budgeting

      The Thomas Jefferson Institute for Public Policy | by Leonard Gilroy | December 2, 2011

      The adoption of a priority based, or outcome-based budgeting system would help Virginia policymakers more easily identify the governmental activities most important to taxpayers and help make difficult trade-off and cost-benefit decisions.

    • SOLUTIONS: South Carolina

      The South Carolina state budget is a mystery. What can be done about it?

      The South Carolina Policy Council | December 2, 2011

      The South Carolina state budget should be more transparent. There should be one document showing the exact amount lawmakers appropriated in a given year and the budget should reveal where all money is coming from.  The budget should list every program each agency is running, how much that program is receiving, and a description of the program.

    • SOLUTIONS: Kansas

      A Budget Stabilization Plan for Kansas

      The Kansas Policy Institute | by Barry W. Poulson | November 29, 2011

      This study proposes a budget stabilization plan for Kansas, which is a rules-based approach to state budgeting. A tax-and-expenditure rule is linked to rules for the disposition of surplus revenue. Under a rules-based approach to budgeting, surplus revenue is used to meet emergencies, stabilize the budget over the business cycle and/or earmarked to fund one-time capital projects. Once those needs are met, remaining surplus revenue is returned to taxpayers in rebates or used to reduce tax rates.

    • SOLUTIONS: Minnesota

      New Budget Tools for a Balanced Minnesota

      Center of the American Experiement | November 29, 2011

      To keep the state budget in balance over the long term, Minnesota must better manage the spending side of the ledger.  Over the past 40 years, total state expenditures from all funds increased at double-digit rates in all but four biennia.  To control spending, Minnesota must adopt bold new budget tools and processes.

    • SOLUTIONS: Wisconsin

      Ten Ways the Budget Could Be Better

      The MacIver Institute | November 29, 2011

      The state government should refrain from onerous interference into the private market and limit pork, and here are 10 suggesitons for doing so.

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