BYOBD (Bring Your Own Budget Deficit)
If misery loves company, Wisconsin must be having a party. As painful as Wisconsin’s budget deficit is, a new report by the Center for Budget and Policy Priorities (CBPP) shows that we are far from alone in having a daunting budget hole to fill.
At least 44 states are projecting shortfalls for fiscal year 2012, according to CBPP, totaling $125 billion. Wisconsin’s budget gap in 2012 is about 13 percent of 2011’s budget. That ranks Wisconsin 22nd among the states, and below the national average of a budget gap of 20 percent. (There’s a variety of ways to calculate the deficit, and CBPP relies on Wisconsin Budget Project figures that include several factors not taken into account in other approaches.)
Nevada and Illinois are facing the biggest deficit as a percentage of their budgets – about 45 percent in 2012. (Read this recent Wisconsin Budget Project blog post about action Illinois is taking to reduce their budget gap.) Minnesota faces a gap of about 25 percent. Wisconsin is also one of at least 20 states facing shortfalls in 2013, ranking 15th among those states, with a gap that is about 12 percent of the previous year’s budget.
The CBPP report warns,
“While states are anticipating significant shortfalls in the coming year, their options for addressing those shortfalls are dwindling. Federal assistance for states, which has been enormously helpful in allowing states to avert some of the most harmful potential budget cuts, will be largely gone by the end of fiscal year 2011, the current fiscal year… There are signs that state finances will start to stabilize after next year, but recovery will be slow.”