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Posts on State Budget And Tax
July 21, 2020

As states revisit their spending plans for the 2021 budget year, which began July 1 in most states, they are making deep budget cuts to offset huge revenue shortfalls triggered by COVID-19 and the worst economic downturn since the Great Depression. The initial state and local cuts enacted in spring and early summer...

Federal Aid to Date and State Rainy Day Funds Won’t Close Large State Shortfalls
July 21, 2020

Amidst an unprecedented state and local fiscal crisis, Senate Republicans reportedly may offer only one form of new federal fiscal aid to states and localities in the next...

Child at school sitting near classmates
July 17, 2020

Increasing the federal share of Medicaid costs (the federal medical assistance percentage, or FMAP) would not only protect health coverage during the pandemic and recession, but also increase employment and economic output by providing relief to hard-pressed state...

Man pushing grocery carts
July 13, 2020

Tax Day, which is July 15 this year due to COVID-19, marks an opportunity to look at the pandemic’s impact on state budgets and consider the crucial role that state tax and spending choices play in people’s lives — such as helping keep residents healthy, providing basic shelter and quality schools, and reducing barriers that block some people, particularly people of color and other...

In Focus: COVID-19 State Budget Shortfalls Could Be Largest on Record
July 6, 2020

Contrary to suggestions by Treasury Secretary Steven Mnuchin and others, borrowing isn’t a viable substitute for the substantial...

Maine state house
July 2, 2020

As federal policymakers consider another package to address the deep economic downturn, one of the most effective steps would be to provide substantial federal grants to help states address their huge revenue shortfalls, as the House-passed Heroes Act would do. That would help states and localities avoid cuts in services and investments that would worsen racial inequities — as my colleague...

People waiting in physically distanced lines
July 1, 2020

Unless federal policymakers provide enough aid to states, localities, territories, and tribal governments to offset all or nearly all of their massive revenue losses due to the pandemic, the longstanding inequities from historic and ongoing racism and discrimination — which have left Black and brown communities most harmed by COVID-19 and the economic crisis — will only worsen from the deep...

Postal Worker Making Deliveries
June 25, 2020

As COVID-19’s health and economic impacts intensify, creating huge state budget shortfalls, states and local governments are laying off workers and slashing support for schools and other services, harming working families — especially in communities of color — and delaying the...

Empty playground behind school building
June 25, 2020

Some wrongly argue that federal policymakers should “wait and see” before giving states more fiscal aid to help address their huge, recession-driven revenue shortfalls, in part because they haven’t spent all the aid they’ve received so far. States, however, have good reasons not to spend all of that aid just yet. And, in any case, they’ll need far more to address their extraordinary shortfalls...

Healthcare worker helping another put on their personal protective equipment
June 17, 2020

The grim outlook for state economies over the next year will be even grimmer if states don’t fully use an important tool: their rainy day funds. Doing so can help lessen COVID-19’s health and economic harm and help states focus their responses on the hardest-hit...

In Focus: Most States Using Rainy Day Funds in Great Recession Kept or Boosted Their Credit Rating