State Fiscal Conditions: Temporary Downturn or New Normal? MAGNY March 15, 2013 New York Scott Pattison Executive Director National Association of State Budget Officers 444 North Capitol Street, NW, Suite 642 • Washington, DC 20001 • (202) 624-5382 • www.nasbo.org
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State Fiscal Conditions: Temporary Downturn or New Normal? MAGNY March 15, 2013 New York Scott Pattison Executive Director National Association of State.
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State Fiscal Conditions: Temporary Downturn or New Normal?
MAGNYMarch 15, 2013
New York
Scott PattisonExecutive Director
National Association of State Budget Officers
444 North Capitol Street, NW, Suite 642 • Washington, DC 20001 • (202) 624-5382 • www.nasbo.org
NASBO 2
Current Fiscal Situation:
Overview
NASBO
Major Challenges to State Budgets - Spring 2013
Improved revenue growth, but not enough to go around…
Federal government
Health care changes, implementation
Dealing with long term liabilities
NASBO 4
Federal Overhang…
Sequester
Debt ceiling
Many program authorizations set to expire
“Grand bargain” tax reform?
NASBO 5
National Economic Indicators
4th Quarter GDP grows a modest 0.1% 3rd Quarter GDP increased 3.1% 14th straight quarter of at least some growth
Federal Reserve projects 2.3%-3.0% growth in 2013
Other economic figures: Unemployment rate at 7.7% in February Manufacturing grows for 3rd consecutive month in February New Home Sales rose 15.6% in January
- “… the still-moderate underlying pace of economic growth…”
- Federal Reserve Chairman Ben Bernanke, 2/26/13
NASBO 6
Current Fiscal Situation:
Indicators
NASBO
GF Growth
-8
-6
-4
-2
0
2
4
6
8
10
12
%
General Fund Expenditure Growth (%)
*35-year historical average rate of growth is 5.6 percent *Fiscal ‘13 numbers are appropriated Source: NASBO Fall 2012 Fiscal Survey of States
* Average
NASBO
FY 2013 Appropriated Spending Still $5.9 Billion Below FY 2008
8
Source: NASBO Fall 2012 Fiscal Survey of States
NASBO
FY 2013 General Fund Revenue is Expected to Surpass FY 2008 by $13B