News From State Budget Solutions - August 2013

Hey, Chicago, whattya say? Chapter 9 is on the way
When Detroit filed for Chapter 9 municipal bankruptcy, observers offered many reasons for the city’s dire fiscal condition. Corruption and downright poor management are obviously to blame, but others point to de-urbanization, the shrinking American auto industry or even income inequality as drivers of Detroit’s inability to pay its bills.

A narrow discussion about Detroit’s condition fails to tell the truth that about 100 cities across America face profound fiscal challenges similar in scope — even with more diverse economies and steadier population. Chicago is one of them.

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Common Core can't pass the cost test

This has been a rough summer for Common Core supporters as more and more states leave the testing consortia due to high costs and uncertainty.

Georgia and Indiana have just joined the list of states opting out of the Partnership for Assessment of Readiness for College and Careers (PARCC), one of the two state consortia responsible for developing tests that fit the Common Core State Standards (CCSS) curriculum. The universal tests are a key part of CCSS, and as more states leave, the less “common” the CCSS becomes. Georgia state leaders say that the cost of PARCC tests, which has been set at $29.50 per student, was too high. The state will maintain its own testing service in order to evaluate students.

Indiana’s departure from PARCC came as part of its “pause” on implementation of CCSS. Governor Mike Pence said that, as part of the state’s evaluation of the CCSS, it would be necessary to leave the consortium entirely in order for the state to remain independent in its budgeting and education decisions.

State Budget Solutions In the News

State Budget Solutions is a known expert in fiscal responsibility and pension reform. Every month, countless media outlets and financial professionals cite the work of SBS's expert analysis and publish the opinions of SBS leaders.

Detroit not alone under crushing pension obligations
USA Today - July 21, 2013

Bankruptcy might turn out to be one — though it might be a painful one to retirees — depending on the Detroit experience, said Cory Eucalitto, editor at State Budget Solutions, a nonpartisan, nonprofit group that researches budgeting. As Detroit knows, you can't always raise taxes and you can't always cut services. And bankruptcy may loom as the only choice left.

"A lot of it's going to have to do with the outcome of it, which will take some time," Eucalitto said. "But upfront, it's going to show people bankruptcy is an option. ... That's going to be a big change." Read More

How Did Rich Connecticut Morph Into One Of America's Worst Performing Economies?
Forbes - August 1, 2013

State Budget Solutions, a think tank monitoring state finances, reported that among the 50 states Connecticut has run up the fourth largest pile of debts per capita — $27,540. This includes unfunded liabilities for government employee pension funds.  The total is almost double the per capita debts of financially-strapped California.  Higher debts imply higher taxes in the future. Read More

The Williams Report

As a former state legislator, gubernatorial candidate and auditor with the Government Accountability Office, State Budget Solutions' President Bob Williams is a national expert in fiscal and tax policies.  Each week, he compiles the latest news and headlines pertaining to state budgets, collective bargaining and state public pensions into The Williams Report.

State budget is full of gimmicks. CT News Junkie

Fixing California: the union chokehold. U-T San Diego

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