Trends and Transitions: March 2011

March Trends


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Trends and Transitions: March 2011

hydraulic fracturing rig

Fracturing for Natural Gas

New drilling techniques have opened up U.S. natural gas supplies that were unavailable just a decade ago. Hydraulic fracturing, often called “fracking,’’ and horizontal drilling make natural gas production from unconventional sources—shale gas, tight sands and coalbed methane—one of the most rapidly expanding trends in oil and gas exploration and production.
Natural gas is found in porous rock reservoirs beneath the earth’s surface; hydraulic fracturing releases this trapped gas.

Natural gas emits fewer pollutants than coal and provides about 22 percent of the total U.S. energy supply, according to the U.S. Energy Information Administration. In the past, fluctuations in natural gas prices and consistently higher prices than coal have limited the nation’s reliance on it. Dependence on natural gas, however, is expected to increase as advances in natural gas drilling technology boost domestic supplies, holding prices down.

Hydraulic fracking for natural gas offers economic benefits to local communities, but its rapid expansion near populated areas has raised some questions about regulation. Since states are responsible for environmental protection during fracking procedures, lawmakers look to weigh the economic benefits against potential harm to humans, water resources and the environment.

To promote job growth and increase tax revenues, legislators in Alabama, North Dakota, Oklahoma, Utah and Wyoming adopted resolutions last year urging Congress to continue Safe Drinking Water Act exemptions for fracturing operations.

While EPA conducts a nationwide study to assess the environmental and public health effects of hydraulic fracturing, state agencies continue to regulate, permit and enforce activities related to natural gas development. Legislatures continue to consider bills that promote, regulate, monitor or tax this growing industry.  

What Do You Make?

State Legislator

Chief Executives

Accountants and Auditors

Budget Analysts


Urban and Regional Planners

Social Workers



Political Science Professors

High School Teachers


Fire Fighters

Note: These estimates are from data collected from employers in all industries and from rural areas and cities in every state.

Source: “May 2009 National Occupational Employment and Wage Estimates United States,” Bureau of Labor Statistics, U.S. Department of Labor, Jan. 2011.

Saving Tax Refunds

Tax time is right around the corner, and this year, struggling families have a new way to save some money for their kids’ futures: purchasing U.S. Series I Savings Bonds with their tax refunds.

Since 2007, taxpayers have been able to use Form 8888 to deposit their federal refund directly into three different accounts, including checking, savings and retirement accounts. (California and Maryland have similar state laws.) Now, federal taxpayers also can use the 8888 form to buy the bonds.

Savings bonds can be purchased for as little as $50 up to $5,000, and the buyer is not required to hold a bank account. Bonds are protected against inflation and pay interest for 30 years, but are redeemable after one year. When cashed in, they can be used for anything, including college tuition or a home mortgage. Starting this year, bonds can be purchased as a gift for others, including children or grandchildren.

The Doorways 2 Dreams Fund worked with the U.S. Treasury, the IRS and the Bureau of Public Debt to develop the savings bond option. The organization works to improve low-income families’ use and understanding of financial services. The nonprofit conducted pilot projects between 2007 and 2010 and discovered that 52 percent of those who purchased bonds had no savings at all, and 41 percent had never before saved their refunds.

Since the savings bond option costs states nothing, but can help people build their personal financial assets, state lawmakers may want to promote it to their constituents through their newsletters and websites.

Recreating State Government

A new crop of governors and legislators are confronting an old problem: dire state finances as the recession, officially ended in June 2009, drags on into a new fiscal year in the states. Federal stimulus funds are drying up. There will be $37.9 billion less in federal stimulus money next fiscal year than in FY 2011, and after that it will be gone. Congress has signaled it is closing the federal pocketbook to states. And the looming budget gap starting in July is pegged at some $82.1 billion, according to NCSL.

True, tax receipts are on the upswing in some states, albeit slowly, but historically, states struggle to regain economic stability long after a recession ends, and collections are still about 12 percent below where they were before the recession began. After addressing budget gaps of some $89 billion last year and $174.1 billion the year before, there is little cushion left. As legislatures convened from Albany to Sacramento, state jobs, pensions, education, prisons and more were on the chopping block.

Here are some of the ideas being talked about in states as of late January:

  • In New York, Governor Cuomo recommended $8.9 billion in spending cuts, including $1.5 billion to K-12 education and $982 million to Medicaid. He is demanding concessions from state employee unions and predicting 9,800 layoffs without them. He is also proposing a 20 percent reduction in the number of state agencies, commissions and authorities, improved tax collections, and an enhanced lottery as ways to plug the state’s $10 billion deficit.
  • California Governor Jerry Brown wants to cut $1.4 billion from the state’s university system, $1.7 billion from the state’s health system and $1.5 billion from the welfare-to-work program. State employee pay cuts of 8 percent to 10 percent would save $7 billion.
  • Illinois lawmakers in a lame duck session temporarily increased the individual income tax rate 66 percent, from 3 percent to 5 percent, to help plug the state’s $13 billion deficit. Coupled with a hike in corporate taxes, these changes will generate about $6.8 billion a year for the state, which also is holding spending growth to 2 percent.
  • A budget developed by the Texas House would cut K-12 education by $9.8 billion and eliminate financial aid to some 60,000 college students. The Texas Legislative Budget Board proposed cuttting more than 9,600 positions from the 241,000 jobs in state government.
  • Massachusetts’ governor wants to overhaul the state’s public employee pension system to save $5 billion over the next 30 years.
  • Florida’s deficit could reach $4 billion, according to some observers. The Legislature wants to balance the budget through cuts at the same time the new governor is pressing for corporate tax cuts and a 19 percent reduction in property taxes. Florida does not have an income tax.
  • Nevada is facing the largest budget deficit in the nation—54 percent of the general fund. The governor wants to borrow against insurance premium taxes to raise $190 million and make significant cuts to K-12 and higher education. State employee salaries will drop 4.6 percent because of mandated furlough days.


Apology Anthology

After something goes wrong with a patient, medical professionals may wish to express their apologies or condolences to patients and their families. Nearly six in 10 doctors say they have done so, disclosing to patients that a serious error has occurred, according to a 2006 survey.

Many doctors are advised, if not ordered, however, to refrain from making such statements to patients and families, in case the matter ends up in court. Such expressions may be used against them in medical malpractice cases as evidence of wrongdoing or guilt.

Some studies, including one at the University of Michigan Health System, have shown that allowing medical professionals to express their sympathy and apologies actually reduces malpractice lawsuits. An organization called Sorry Works! was created in February 2005 to advocate for full disclosure by physicians, hospitals and insurers when medical errors occur in the belief that doing so is an effective way to reduce malpractice lawsuits, liability costs and even medical errors.

Thirty-five states, the District of Columbia and Guam have some type of “I’m sorry” law or regulation, according to Sorry Works! They vary in what they protect, but generally cover medical professionals’ apologies or sympathetic gestures from being used in court.

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