State Fiscal Crisis

D.C. Fiscal Uncertainty Keeps State Budgets Unsettled

A guessing game for everybody


As many states open their 2013 legislative sessions this month, they still don't know how much money to expect from Washington for the coming year.

The deal that Congress and President Obama reached in early January to avert the so-called "fiscal cliff" halts the most severe tax increases that were slated to take effect without an agreement. But it postpones action on spending cuts—a crucial question for states since the federal government provides about 30 percent of their revenue.

"They left uncertainty on the table," says Michael Bird, senior federal affairs counsel at the National Conference of State Legislatures.