Many states facing big ’03 deficits
Declining tax revenue and the falling stock market are creating massive deficits in quite a few states, including the biggest ones. Huge spending cuts and tax increases seem the only way out.
While last June’s state budget battles proved politically charged and fiscally painful, economists and policy analysts say the upcoming sessions will be worse because lawmakers used up all the relatively easy one-time maneuvers to find revenue.
“It will be bloody and the sessions will be hugely contentious,” said Nicholas Johnson, director of state fiscal research at the Washington-based Center on Budget and Policy Priorities.
Here in California the expected 2003 deficit is 20 billion. Yes, that’s a “b”, not an “m”. Los Angeles and New York City are also facing major deficits.
And no one really has a clue what to do.