2010 Industry Outlook State Government: A Look Ahead
Source: Deloitte LLP
It's no surprise that the acuity of a continuing revenue shortfall is the biggest issue facing state governments in 2010. Although the U.S. economy in general has begun its slow, arduous recovery from the worst economic crisis since the Great Depression, states are expected to see their sales and income tax revenues continue to nosedive in the coming year, the result of rising unemployment and a decline in consumer spending. In addition, all states except Vermont have a constitutional requirement to balance their budgets, which heralds more and deeper cuts to jobs and services - despite an infusion of funding from the American Recovery and Reinvestment Act (ARRA).