Federal Issues

 

Information on federal legislation, mandates, programs, executive orders, and other actions that impact state finance. In fiscal year 2011, federal funds represented 34 percent of total state expenditures, although this percentage is likely to decline following the wind down of the funding provided through the Recovery Act. The possibility of future federal budget cuts combined with likely congressional changes to healthcare, K-12 education, tax policy, and other areas, has led to a significant level of uncertainty among state decision-makers.

Staff Contact: Kathryn Vesey White

NASBO Publications

  • The latest edition of NASBO’s State Expenditure Report finds that the recent improvement in the national economy has not translated to strong growth in total state spending. This is largely due to the fact that state revenues have not increased as fast as Recovery Act funds have declined, leading to a unique situation in which total state expenditure growth has slowed during the same time that the national economy has been improving.
  • State fiscal conditions in fiscal 2013 are modestly recovering in step with the slowly improving national economy. General fund spending levels are expected to increase by 2.2 percent this fiscal year, which is less than half their historical average growth rate. Signs of budget volatility have subsided compared to the years immediately following the recession, and fiscal conditions in most states reflect continued fiscal stability.
  • State fiscal conditions are continuing to improve into fiscal 2013, although many state budgets are not fully back to prerecession levels. This report finds that governors’ recommended budgets show an overall increase in both general fund expenditures and revenues in fiscal 2013. Fiscal trends indicate that while