The media attention on several recent municipal bankruptcy filings leads to the question: What role do states play when a municipality faces a fiscal crisis and potential bankruptcy? Examination of some recent cases reveals that states can and do respond in myriad ways to local fiscal problems. How a state reacts may depend on a variety of aspects. Some may be political in nature, such as the nature of relations between the state governor and legislature and the municipality’s top officials.
NASBO's 2012 Annual Meeting in Rhode Island was a great success. Special thanks to the Rhode Island Department of Administration - Budget Office for all of their hard work. Below are a few highlights from the meeting sessions. NASBO members with individual user accounts can now access all speaker presentations under the NASBO Member Content tab, Past Meeting Presentations.
Comments from Attendees:
“Each session provided some thing I didn’t know before or had not thought of.”
Recent efforts by the Governmental Accounting Standards Board (GASB) to implement pension accounting reforms are intended to reduce pension risk and encourage public plan administrators to confront future liabilities with greater prudence. GASB aims to accomplish this by allowing the use of a higher discount rate for funded liabilities than for unfunded liabilities, which in theory creates an accounting incentive for state and local governments to fund pension liabilities.
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
U.S. Supreme Court Issues Ruling on the Affordable Care Act
NASBO joined other state and local organizations to express concerns regarding the Digital Accountability and Transparency (DATA) Act. The legislation (HR 2146) creates a new independent, oversight commission to track federal spending on grants, contracts, loans and other assistance. The bill expands the reporting requirements used to track Recovery Act spending to all federal grants and agencies, not just programs that were part of the Recovery Act.
Over the course of the past several months, governors in 34 states have released their fiscal 2013 budget proposals (16 states enacted biennium budgets last year covering both fiscal 2012 and fiscal 2013). This document provides summaries of these budget proposals and links for further information about specific states.
State Budgets and the High Costs of Higher Education
Higher education like many areas of state spending has experienced funding erosion in the “new normal” budget environment. However, many of the budgeting problems for higher education are unique; because unlike most state goods and services, higher education has multiple sources of revenue, which means state funding tends to be less consistent.
Last summer out west I saw a state park on the map and decided to drive out and hike there, only to arrive and find it was closed. While state parks make up less than one percent of most state budgets, their treatment in budgets is symbolic of the very tough decisions state officials will have to make as they continue to develop their state budgets this year. As state monies increasingly go to large parts of the state budget like K-12 education and health care, state officials have to decide how to deal with the smaller discretionary parts of their budgets.