As the U.S. moves toward a national broadband map, several states are undertaking mapping projects thanks to grants from the American Recovery and Reinvestment Act. A national map will help states determine where broadband Internet actually exists and where it doesn’t, helping to expand access to areas that currently lack it.

Ezra Klein of the Washington Post asks this question:  "Did the stimulus a) work; b) fail; c) end up locked in an unexpected battle with the massive anti-stimulus that's ripped through the states?"

The interest in taxing soda on a state level has rebounded in recent months. While only 14 states levy a sales tax on food for home consumption, 39 states and Washington, D.C., impose a sales tax on at least some soda purchases. In some of these states, the tax is simply part of the sales tax that applies to food; in others, it is a separate or higher tax.

Unemployment rates remain high and people are unemployed for longer, exhausting state unemployment trust funds quickly.  More states are borrowing from the federal government to cover costs, which could have an impact on future fiscal stability.

Worst case scenarios abound if Congress fails to extend for another six months the enhanced Medicaid match begun by the 2009 stimulus. CSG’s recent survey found that over half the states have already counted on the extension, from January 1 until June 30, 2011, in their budget deliberations for FY 2011. The Senate appears poised to put the extension back in the so-called “tax extender” bill next week.

States and municipalities borrow hundreds of billions of dollars every year through the bond market. In 2008-09, upheaval in U.S. financial markets changed the way governments could borrow money to finance infrastructure building and other activities. State treasurers and other officials responded by changing how they market and package their bonds in order to keep funds flowing to vital projects.

Contrary to the claims of many pundits, voter initiatives have not constrained the California budget to the extent that fiscal crises are inevitable. I reach this conclusion by examining each of the 111 successful initiatives in the state’s history. For the 2009-2010 budget cycle, voter initiatives locked in about 33 percent of spending, most of which probably would have been appropriated even if not required, and placed no significant prohibitions on the two primary sources of state revenue—income and sales taxes.

Fiscal conditions rapidly deteriorated for states in the 2009 fiscal year as the nation remained in a prolonged economic downturn. States experienced unprecedented declines in both revenues and state spending, while rainy day fund levels sharply declined from the 2008 fiscal year. While the national economy may be slowly recovering, conditions have not improved for states in the 2010 fiscal year. State spending is projected to be negative for the second year in a row. Revenue collections remain weak, with total collections declining for a record five consecutive quarters. The state fiscal outlook is expected to remain grim in fiscal 2011 and beyond as Recovery Act funds decrease and revenues are slow to recover.

States’ fiscal environments continue to feel the devastating effects of the recession, even though many economists have concluded the recession ended last summer. Economic output—gross domestic product—rose during the third quarter of the 2009 calendar year, albeit at a modest 2.2 percent annual rate, and the economy is expected to continue growing. But state tax revenues have not shown evidence of an expansion as revenues are still falling in many states, and it will likely be a number of years before tax revenues recover.

For those in the industry of government accountability, the term “unprecedented change in 2009” is an understatement. With the enactment of the American Recovery and Reinvestment Act of 2009, government financial management professionals embarked on a monumental undertaking: using existing limited resources to quickly develop a new, efficient, Web-based system of reporting and accounting for federal grant funds. Everyone recognized the enormity of the task; no one, however, could have foreseen the extraordinary levels of intergovernmental cooperation that would emerge.

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