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Of the 20 states with the worst budget shortfalls, Minnesota appears to be one of only three that won’t raise revenues.

Evidence from national organizations suggests that Minnesota will be part of a very small minority of budget-stressed states that do not raise state tax revenues to address severe revenue shortfalls caused by the Great Recession.

Here are two studies illustrating the point. These two surveys, one by the Center on Budget and Policy Priorities and the other by the National Conference of State Legislatures, show that of the 20 states with the most severe budget shortfalls, Minnesota, Louisiana and Georgia are the only three that have not already raised revenues or are still considering it.

Here is a map by CBPP showing the 36 states that either have enacted or are still considering revenue increases:

And below is a list showing the states with the worst budget crises, expressed as a percentage of general fund budget. Minnesota ranked 10th worst at the beginning of the year, before the deficit grew in the revised forecast.

FY2010 Budget Deficit As a Percentage of State General Fund Budget

Rank
State
Percent
1
Nevada
37.6
2
Arizona
28.2
3
California
22.3
4
Louisiana
19.8
5
Washington
18.5
6
Hawaii
18.0
7
Wisconsin
17.2
8
Kansas
17.0
9
Vermont
16.5
10
Minnesota
14.7
11
Connecticut
13.6
12
Rhode Island
13.1
13
Delaware
12.9
14
Michigan
12.3
15
Maine
12.2
16
Maryland
11.7
17
Iowa
11.5
18
Virginia
11.2
18
Florida
11.2
20
Georgia
11.0
21
Massachusetts
10.7
22
Idaho
10.0
23
South Carolina
9.1
24
Utah
9.0
24
Tennessee
9.0
26
Oregon
7.7
27
Nebraska
7.3
28
South Dakota
6.7
29
Texas
5.1
30
Colorado
4.6
31
New York
4.5
32
Oklahoma
4.4
N/A = information not yet available or state not projecting a budget deficit for 2010. Source: compiled from “Update on State Budget Gaps: FY 2009 & FY 2010, National Conference of State Legislators.

The following op-ed by Growth & Justice President Dane Smith offers analysis on this topic, and the opinion that Minnesota should not emulate the reduced public investment, forced by a low-tax imperative, that has become the norm in Deep South states:

Minnesota joins Louisiana and Georgia as anti-tax holdouts among budget-battered states






News & Media
The autocrat at the kitchen table: Unallotment means less money for community purposes and also less of what we value in government
Dane Smith and Charlie Quimby of Growth & Justice submitted a version of the following op-ed to the St. Paul Legal Ledger - Capitol Report.

Growth & Justice and Common Cause Minnesota urge Pawlenty to make unallotment process open and transparent
Common Cause Minnesota and Growth & Justice, two groups that place a high value on government accountability, are calling on Governor Tim Pawlenty to make the unallotment process open and transparent. The groups sent a letter to the governor asking him to disclose all input and lobbying efforts directed at the governor’s office to influence unallotment decisions.

What business really needs (and how taxes help pay for it)

The following column by Dane Smith recently appeared in the St. Paul Legal Ledger Capitol Report. It was picked up by several online entities and received positive feedback from the higher education and business community.


 
Growth & Justice is a leading progressive voice on state economic issues. We are a non-partisan advocate for fair taxation and "smart" public investment — fiscally responsible, accountable investment that advances prosperity for all Minnesotans. We believe a sustainable economy provides the foundation for a just society.

 
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