Book of the States 2009

The U.S. is undergoing a major demographic revolution that will have major public policy implications across regions and states and within regions and states. Our population is aging, we are becoming more diverse, dramatic migration patterns are occurring and social indicators reveal major challenges ahead.

Most states collect and analyze data on their government work force. With the baby boomer population reaching retirement age and 27 percent of the state work force across the country eligible to retire within the next five years, assessing the shrinking work force will continue as a critical exercise.

Since its implementation in 2005, Washington’s Government Management Accountability and Performance (GMAP) program has become an invaluable tool to Washington Gov. Chris Gregoire in measuring and improving the performance of state agencies.

For the past four decades, states have turned to legalization of various forms of gambling to generate tax revenues or to stimulate economic or tourism development. Legal gaming industries generated more than $92 billion in gaming revenues in 2007, with about two-thirds of that coming from commercial or tribal casinos. By 2009, lotteries had become nearly ubiquitous in the United States, and casinos are within a few hours drive of virtually every American. Internet gambling, however, is presently prohibited by federal law, and certain forms of gambling, such as sports wagering, are generally prohibited outside Nevada.

Fiscal conditions in the states began to decline in fiscal 2008. State spending and revenues grew at a lower rate than the prior year and balances were well-below their near record levels of fiscal 2007. While fiscal 2008 saw somewhat moderate declines, the fiscal situation in the states has deteriorated much more sharply in fiscal 2009. State spending is projected to be negative for the first time since 1983, balance levels are being reduced as states use reserves to address shortfalls, and recent data shows state revenues declining by 4 percent. As a result, states are likely to face a difficult budgetary environment in fiscal 2010 and beyond.