Update on State Education Budgets and FY 2010 Education Funding Bill

The Center on Budget and Policy Priorities (CBPP) has analyzed recent state budget shortfalls, some effects of ARRA funds on state and local governments, and identifies circumstances and suggestions for states and localities as they plan for FY 2011.

The CBPP analyzed selected impacts of the economic stimulus and recovery funds, on state and local governments in the future. It was reported that state revenues for the second quarter of 2009 are down 17 percent compared to the second quarter of 2008 sate revenue levels. States reported first quarter, 2009 revenue losses of 12 percent.

These 2009 revenue losses reported by the nation’s state governments represent the largest decline since the 1960s. States have taken $170 billion in state budget actions in order to meet their balanced budge requirements for FY 2010.

In a majority of states this has meant reducing state funds and services for education, health, and other human services, among other actions. CBPP predicts that for the states FY 2011 will be worse than FY 2010, in terms of decreased revenues, as unemployment is likely to remain high.

Source: Education Legislative Services, Inc. (ELS)

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