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4ti~ mlrll~e~poiiI lrlDun! Mon, I;)c[. 1z, llillll
<br />
<br />Governors' report:
<br />Most States' fiscal
<br />
<br />! -condition worsening
<br /> By Roberg Pe~' ~ year 1981 and was expected to
<br /> New York TlmesServlce fall to 1.5 percent in the current
<br />
<br /> I W-*hf~loa. D.C. . .
<br /> Th~ fLqcal condlUon of most stnte Another m~ure show~ me number.
<br /> governments h~s delerloimted since of state government working day~
<br /> 1979 and ~ey are un~ble~ with ex~. Ltm[ could be financed .out of the
<br /> lng revenue sources, to increase ' balance left in the general fund
<br /> i spending {o make up for the loss of the end of the ~ year. The aver-
<br /> federaLald ~hls yea.r, according'to a age for all states drOpl~d from 22
<br /> s~udy by the NaUonsl Governor~ ~ working days at the end of the fiscal
<br /> sociaUoo. ' year 1980 to eight day~ hl 1981
<br /> · - wl~ expecled ~o drop to four day~
<br /> The study, Issued la~ week~ found 198l. .
<br /> I that 30 stales were expecting to , ,
<br /> speud more money on ol~raUons These proJectio~s were ba_sa~ main-
<br /> tha~ they would take In a.S revenue 1¥ on data collected from state bud-
<br /> in the curr~nt fiscal year. get officers ht~t spring, before feder-
<br /> al budget and tax cut~ were emacte~
<br /> I t Harold Hovey, a coauthor of the re- The budget cu~ reduced by as much
<br /> port who bas served I~s state budget as 25 percent the amount of federal
<br /> officer In 0bio a~d lllinols,-add Fl't- money available for m~ny 'health
<br /> day, "I know of no s~ates that are and social service pro.'ams. The tax
<br /> . pl~nnlnE id offset federal ~fd cu~s' by cuts sharply r~duced the amount of
<br /> i raising t~eir own taxes. While some revenue that ca~ be raised by states
<br /> states are increasing highway user that tie their corporate or personal
<br /> charges sucl~ as l~.sollne tl~es, that tax rates to federal rates a~d depre.
<br /> -- acllo~ is basically unrelated to the ci8flon schedules.
<br /> fe4eral reducUous." ' , - '
<br /> The federal changes "will cause
<br /> I A key bldic~tor ot the fiscal condl- many stat~ sigulficant ~ pmb-
<br /> tion o! a slate govern~ment is the lem~," the reports aid. .
<br /> amount ot money r~lll~lntn~., at the . -
<br /> end of the year, expressed as a per- Hyman Grossman, a vice president
<br /> cenl~ge of lbo year's expendltares, of ~umdard & Poor's Corp. sadd that
<br /> I from the general operath~ fund, in the b~ few years the bond-rating
<br /> whicil is used to firmnce most state agency had lowered raflzlgs for gem
<br /> acUvitie~ Balances for aU states at end obligation bonds Issued by WL~
<br /> the end of the fLs~al year 1980 repro- con~l% Mim~esota, Ohio, CalU'ornla,,
<br /> sented 9 percent o! spendln~ The Michigan and Connecticut. The slip.
<br /> i t~,ttre dropped to 3.3 perce~ in the In credit, he said, reflected econom-
<br /> · . . tc condition~ h~ the states ~.nd their
<br /> r~u~:~ ~ tendenclr ~o spend more finn
<br />
<br /> I [ ~ ~l~lgl~llffiM ' ~' ~ Moody's Investors Service. said t/mt
<br /> ., 1 ~ al~oug~ there lind been some ex-
<br />
<br /> [ ~r~~7~V.~-a-i. ware, "] would have to agree thai. as
<br /> I r~&?~c.o,~a~ an over-aU conclusion, ..a'n!_~ are in
<br /> I ] I~rdi~l~a~"Oo~14m"~la$~4al . I~.~. a~.~tr~k~ el~.~ .-~alelnn
<br /> I a..,..w~;,,k~ . ~,.,, ~ey. were several years ago.
<br /> ~ lu~ la.st week, she said, Moody's
<br /> ~..~o~...t~.~.o.~a.~r=~u,v~w~ lowered U~e rafl~8 for senerai
<br /> ."W,~kk.~/C~,'~ ~ ~ ~ g~f401~ boDd. s of the StaLe of W~q.h!n~G~-
<br />
<br /> ~ E~ ~ vn0~ ~d s.r~ v~ lng below prevtous
<br />
<br /> · , cai Survey of the States," ta~es L~me
<br /> I,.,~.~,~/nd~At.~,wa~ with the view expressed.by some
<br />
<br /> .governments can absorb the shock of
<br /> ~r,~r~k~'~T~a~C~,~mm reducUons in federal aid becaus~
<br /> I ,~~ by. ~4.eo per y~e ~1~ they usually h~ve balanced budget~
<br />
<br /> ' k~*.,d.e"~.x~40.40S,x,=~, ne~=d, ed" for the ]zor'ma.l governmc-n.t
<br /> ~' ee~ ~/~lp~ r~m ~ me~p~m a operatio~s, ~e study said. But it said
<br />
<br /> i "hedges ~_t~tn~ ,L%~onomlc nncertaJl2-
<br /> r~,~ ~-~ The study found co~Lstderable re~lon-
<br />
<br /> I ~eae.~ee~..~o~ c,o~P,~ Hovey sold slates that derived reve-
<br /> v~ c~,~x.~o~ e..a~.a, ~ Tex~ and ALa.O~ or from cool, such
<br /> ..Doe~M~lO~¢CegE~m~l~ 8~ North Dakota, were doLog well
<br /> The stump In the automobile IAdus-
<br /> I 2M~eko"~ try bas seriously burr the economies
<br /> -of Michl~8/L b3dlRrm and
<br />
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