State News Roundup

December 2, 2010

Here’s a look at some of this week’s most interesting, and consequential, budget- and economy-related issues in the 50 states:

As reported by The Wall Street Journal yesterday, states collected more taxes and subsequently increased spending.  Most states will retain budget gaps for years to come, in part due to waning stimulus funds. A report from the Rockefeller Institute showed third-quarter tax collections were still 7% below the third quarter two years ago, which should signal states further austerity measures are needed.

Chicago Tribune recently detailed massive fraud in Chicago’s mass-transit system. “Free riders” are using deceased senior citizens’ passes. The Regional Transit Authority (RTA) estimated abusers of the free-ride program— meant for senior citizens and persons with disabilities — cost the agency, and taxpayers, $50,000 in 2009. Per the article, a House committee approved legislation that would scale back the free-rides program by setting income limits for seniors to qualify.

Monday’s Richmond Times-Dispatch highlighted cheerful holiday news for Virginia’s state employees that will come in the form of a 3% bonus added to their December paychecks.  Unlike many states facing major budget gaps, Virginia ended the past fiscal year with a $400-billion surplus. The articles notes that state employees have not received a pay raise since November 2007, and Governor Bob McDonnell said, “I don’t see any long-term pay raise in the near future.”

As noted by the Cincinnati Enquirer, a new proposal would require Cincinnatians to pay $246 annually, or $20.50 per month, for their trash collection in order to reduce Cincinnati’s projected 2011 $60 million deficit. Other proposed budget-cutting measures include: laying off 144 firefighters and 131 police officers, closing 19 pools, cutting free events offered by the parks departments and reducing funding for the regional and African-American chambers of commerce.  Milton Dohoney, the city manager who developed the proposal, said, “No one relishes being in this situation. … When 90 percent of a government is people, you cannot have a $60 million gap without impacting people.”

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