Monday, January 17, 2011

States' desperate times lead to desperate measures

New York: Democratic Gov. Andrew Cuomo proposed eliminating 20% of state agencies by combining duties, such as merging the Insurance Department, Banking Department and the Consumer Protection Board into the Department of Financial Regulation. It's part of "radical reform" to pull his state out of its fiscal crisis.
New Jersey: Republican Gov. Chris Christie skipped a $3.1-billion payment to the state's pension system in a push to cut benefits for public workers, while proposing higher employee contributions and a boost in the retirement age from 62 to 65.

Georgia: Deep cuts appear to await the state's popular HOPE scholarship program that provides public-college tuition to students who earn good grades. Rising tuition and enrollment have outpaced the lottery revenues that fund the program, and Republican Gov. Nathan Deal has not proposed any additional state money to bail it out.

Illinois: Lawmakers voted for a dramatic 66% hike in personal income tax, from 3% to 5%, in a bid to resolve a $15-billion deficit, which amounts to more than half of the state's general fund. The tax increase will be coupled with strict 2% limits on spending growth. "It's important for their state government not to be a fiscal basket case," said Gov. Pat Quinn, a Democrat.

Texas: In oil-rich Texas, where education and social service spending is relatively low and Republican Gov. Rick Perry has railed against government spending, hard times loom. The shortfall is projected to be between $15 billion and $27 billion over the coming two-year budget cycle.

South Carolina: Outgoing GOP Gov. Mark Sanford proposed a spending plan that would end funding for museum and arts programs, slash college funding and cut state workers' pay by 5%.

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