Read Bob Williams' statement on the court's decision permitting the city of Stockton, CA to file for bankruptcy protection. Find our coverage of municipal bankruptcy and how other CA cities have avoided bankruptcy.

Wilshire Consulting estimates that the ratio of pension assets-to-liabilities, or funding ratio, for all 134 state pension plans was 73% in 2012, down from an estimated 77% in 2011. This deterioration in funding ratio was fueled by global stock market volatility in the twelve months ending June 30, 2012. Growth in fund assets could not keep up with growth in plan liabilities over fiscal 2012.

They are tasked with patching a projected deficit of more than $1.2 billion for the next two-year budget ending in mid-2015.

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.

Minnesota taxpayers and insurance policyholders may be on the hook for an additional $36 million a year to help prop up three struggling pension funds.

Whether federal bankruptcy law trumps the California law that requires pension fund debts to be honored could have huge implications across the state and the rest of the nation, experts say.

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.

When the Democratic-led House takes up its budget tomorrow, speeches will be made and a half-dozen or more floor amendments will be offered but Republicans - now in the minority - say they don't plan to prolong the debate or delay the vote.

The people of Stockton will feel financial fallout for years after a federal judge ruled Monday to let the city become the most populous in the nation to enter bankruptcy.

State officials have a deep bag of tricks to "solve" budget gaps but they often keep budgets far from being balanced. This consistent habit of kicking the can down the road has put states in their current fiscal catastrophe. Below are some of the gimmicks on which lawmakers rely, and examples of how states have used them.

In attempts to reign in the costs of pensions, state lawmakers legislate pension reform. Challengers to those reforms often bring suit, alleging violations of state law, contracts, and the Constitution.

For the first time, Texas lawmakers risk bumping up against a constitutional ceiling on spending growth. And some see a politically fraught vote to exceed the limit.

GASB rules, Moody's addition could mean headaches for execs.

The $135 billion budget closes a $1.3 billion budget gap and increases spending for schools by more than $1 billion, to roughly $21 billion.

The Chapter 9 bankruptcy case also is being closely watched nationally for the potential precedent-setting implications: whether federal bankruptcy law trumps the California law that says debts to the state pension fund must be honored.

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.

State Controller Thomas DiNapoli has weighed in on the new state budget with a mix of praise and warnings.

The Assembly's march to approve the state budget was interrupted briefly on Thursday by an impassioned rank-and-file effort to reverse cuts in programs for the developmentally disabled.

14 of the state's top 25 pension recipients worked at University of Illinois Chicago College of Medicine before retiring with pensions of over $250,000 a year. At least seven of them have been hired back, at salaries of up to a $100,000 in addition to those pension payments.

Florida lawmakers in the House and Senate may be on a long road to compromise as they advance starkly different plans on overhauling the state retirement system.