Skip to content
Subscriber Only

Recovering U.S. State Budgets Run Headlong Into Stock Declines

  • Correction May Pinch Income Taxes, 31% of Their Revenue
  • California Already Forecast 9% Drop in Capital-Gains Tax Money

The gradual recovery of U.S. state budgets, which collectively anticipated 3.1 percent more revenue this year, may be reversed by stock market declines that imperil income taxes, their largest source of money.

Since 2011, states have been restoring education, health care and other programs slashed during the recession, and the trend was forecast to continue this year, according to the National Association of State Budget Officers in Washington.