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2013 Presents a Dichotomy for State Budgets

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  • Jane Andrade
    Director of Public Affairs
    Denver
    303-856-1464
  • Jon Kuhl
    Director of Public Affairs
    Washington, D.C.
    202-624-3557
August 12, 2013

2013 Presents a Dichotomy for State Budgets

Stronger Revenues Give Way to Slower Growth in New Fiscal Year

ATLANTA—State fiscal conditions continued to improve in 2013, with general fund revenue growth notably strong, outpacing budgeted projections in most states for the just-ended fiscal year. At the same time, revenues are now expected to decelerate as states begin their new budget years, according to NCSL’s State Budget & Tax Actions report released at the organization’s 2013 Legislative Summit in Atlanta.

State revenues grew at one of fastest paces since before the Great Recession, growing at a 5.3 percent rate in FY 2013.  
“State legislators have once again made the tough decisions that are required to balance their budgets in a slowly recovering economy,” said William Pound, NCSL’s executive director. “The new budgets enacted for the new fiscal year reflect the cautious path that states are taking as they make their way through this economic transition.”

The report found that:
  • While state general fund revenues grew by 5.3 percent in FY 2013, a slowdown is anticipated in FY 2014, with projected revenue growth of 1.3 percent.
  • FY 2013 year-end balances rose 23 percent above prior-year levels, but are expected to decline 11.6 percent by the close of FY 2014.
  • Substantial changes in income taxes, sales taxes and transportation funding mechanisms dominated 2013 state tax discussions.
  • General fund spending growth for Medicaid is projected at 5.9 percent in FY 2014.  

In addition to revenue and spending changes and projections, the report looks at spending priorities in FY 2014, including K-12 education, higher education, corrections and Medicaid.

This report continues NCSL's long tradition of providing accurate, comprehensive and nonpartisan data on state finances.

NCSL is a bipartisan organization that serves the legislators and staffs of the states, commonwealths and territories. It provides research, technical assistance and opportunities for policymakers to exchange ideas on the most pressing state issues and is an effective and respected advocate for the interests of the states in the American federal system.

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