Deloitte Says States Face Increasing Fiscal Challenges

A recent report from Deloitte’s highlights the many challenges facing state governments this year and beyond. “Aging populations and crumbling infrastructures are increasing the strain on budget coffers. Increasing global competition is again prompting calls for improved educational performance. Citizens are continuing to demand more and more services from state governments but don’t want to raise taxes to pay for them, ” Deloitte says. “Because of continued political dissension and partisanship at the federal level, citizens are increasingly looking to state and local governments to solve their problems. ” In a year projected to demonstrate only moderate revenue growth — which will be counterbalanced by social and economic challenges around the subprime mortgage crisis — states are facing some daunting needs that carry huge price tags. Unlike the federal government, however, states cannot deficit spend. Specific and immediate challenges...