Washington, DC, USA. Inclement weather has strained state and local budgets. The heavy snowfall that blanketed much of the mid-Atlantic region in recent days broke records and exhausted an entire winter’s worth of state and local cleanup budgets in some places.

There is increasing talk of levying tax hikes to meet budget shortfalls.

Election-year tax hikes are usually the last thing politicians want to consider, but that’s just what officials in Arizona, Pennsylvania and Washington state are talking about this week.

Snow puts strain on state and local budgets

Virginia’s Department of Transportation budgeted $79 million for snow removal this winter, with an extra $25 million available for emergencies. In the aftermath of a blizzard that dropped more than 30 inches of snow in some areas, both funds already have been depleted, The Wall Street Journal reported.

With another major storm hitting the mid-Atlantic on Feb. 9th, Maryland has spent about $57 million of the $60 million it allotted for snow removal, while the District of Columbia has churned through its $6.2 million cleanup budget, according to the Journal.

In southern New Jersey, “the situation seemed so uniformly dire that state lawmakers asked Gov. (Chris) Christie (R) to request emergency federal help,” The Philadelphia Inquirer reported.

The snow couldn’t come at a worse time for many state and local officials, who are already struggling to close budget shortfalls.

Talk of tax hikes grows louder

Election-year tax hikes are usually the last thing politicians want to consider, but that’s just what officials in Arizona, Pennsylvania and Washington state are talking about this week.

Republican Arizona Gov. Jan Brewer — bucking her party’s traditional aversion to tax increases — has long sought an increase in the sales tax to help her state through one of its rockiest fiscal periods ever. Late last week, the GOP-controlled Legislature approved Brewer’s plan to send a temporary, 1-cent sales tax hike to the voters on May 18, The Associated Press reported.

If approved, the plan would generate up to $1 billion over three years for the state, which faces a shortfall of at least $2.6 billion on a $9.5 billion spending plan for the fiscal year that starts in July, AP reported. A November study by the Pew Center on the States found that Arizona is the state in greatest “fiscal peril,” after California and its well-publicized money problems.

Brewer cast the sales-tax proposal in dire terms, telling The Arizona Republic “there’s no other way.”

In Washington state — where Democratic Gov. Chris Gregoire also has said a tax hike is likely to be part of the budget equation, despite campaigning in 2008 on a pledge not to do so — lawmakers this week removed a key obstacle to raising taxes. The Democratic-controlled Legislature suspended a portion of a voter-approved initiative that requires a two-thirds majority to raise taxes, The Seattle Times reported.

Under state law, the Legislature can change voter-passed initiatives with a simple majority after two years, The Times said. The initiative in question — supported by Tim Eyman, the state’s prominent anti-tax activist — passed in 2007. Majority Democrats have said they will raise taxes in order to avoid deep cuts to social services, though the exact form of those tax hikes remains unclear.

In Pennsylvania, where Democratic Gov. Ed Rendell last year failed to win support for a 16-percent personal income tax hike, his budget proposal for the coming fiscal year calls for an elimination of sales-tax exemptions on dozens of goods and services, the Pittsburgh Post-Gazette reported.

While Rendell’s plan would lower the state’s basic 6-percent sales tax to 4 percent, it would apply the levy to a broad range of goods and services that are currently untaxed. According to the Post-Gazette, those products include candy, gum, newspapers, magazines, personal hygiene items, firewood, flags and dry cleaning. Rendell estimated that the changes would raise an extra $531 million in the first year, money he said the state desperately needs as the federal stimulus runs out.

Rendell’s budget also calls for a new tax on natural gas extracted from Pennsylvania’s expansive Marcellus shale, the Post-Gazette reported.

Stateline is a nonpartisan, nonprofit news service of the Pew Center on the States that provides daily reporting and analysis on trends in state policy. TS-Si thanks The Pew Charitable Trusts for its support and cooperation.

Stateline reports are prepared and published by TS-Si.org with permission. Signed articles do not necessarily convey an official position of TS-Si, its partners, or affiliates.

The TS-Si News Service is a collaborative effort by TS-Si.org editors, contributors, and corresponding institutions. Sources can include the cited individuals and organizations, as well as TS-Si.org staff contributions. Articles and news reports do not necessarily convey official positions of TS-Si, its partners, or affiliates. We welcome your comments. Use the form below to leave a public comment or send private correspondence via the TS-Si Contact Page. We will not divulge any personal details or place you on a mailing list without your permission.


TS-Si is dedicated to the acceptance, medical treatment, and legal protection of individuals correcting the misalignment of their brains and their anatomical sex, while supporting their transition into society as hormonally reconstituted and surgically corrected citizens.

Tweet

Comments (0)

Subscribe to this comment's feed

Show/hide comments

Show/hide comment form

Name

Email

Website

Title

Comment

smaller | bigger

I have read and agree to the Terms of Usage.

Add Comment