As states close the books on fiscal year 2012, which ends on June 30 in most states, many expect to end the year with their budgets in the black. More than half the states reported to the National Conference of State Legislatures in April that their revenues would exceed spending for the year (see map).
But state budget problems are far from over. Until employment returns to pre-recession levels, state revenues won’t be healthy enough to avert the need for more spending cuts or to support tax cuts.
Here’s what those modest “surpluses” mean — and what they don’t.