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Center on Budget and Policy Priorities Analyzes Selected Impacts of ARRA Funds on State and Local Governments in the FutureOctober 10, 2009—In a presentation to organizations that work on federal programs that benefit low-income individuals and families on October 9, 2009, the Center on Budget and Policy Priorities (CBPP) analyzed selected impacts of the economic stimulus and recovery funds on state and local governments in the future. States are starting work to develop their fiscal year 2011 budgets now. Implementation of State FY 2011 budget plans will begin in July, 2010. According to CBPP, nationwide, state revenues for the second quarter of 2009 are down 17% compared to the second quarter of 2008 State revenue levels. States reported first quarter, 2009 revenue losses of 12%. These 2009 revenue losses reported by the nation's State governments represent the largest decline since the 1960's. States have taken $170 billion in State budget actions in order to meet their state balanced budget requirements for FY 2010. In a majority of states this has meant reducing state funds and services for education, health, and other human services, among other actions. CBPP predicts that for the states FY 2011 will be worse than FY 2010 in terms of decreased revenues, as unemployment is likely to remain high. There are 30 states that have increased taxes to balance state budgets, but there are limits in some states on raising taxes. Therefore, many public policy and budget experts are working to identify options on how and where states may balance revenues and spending. Read more information, including the affect of the ARRA funds, in the Legislative Update from Education Legislative Services. | |||||
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