Difficult Budget Days Ahead

State tax revenues for April were way down, continuing a disappointing trend. State Budgeteers are now projecting a $3 to $3.2 billion shortfall for FY 2008-09. By most counts that number will grow to an even larger structural deficit for the coming fiscal years. Even with the federal stimulus and other infusions of one-time monies, some are suggesting that gone are the days when either more spending cuts or tax increases can get the Commonwealth out of this hole. Even with this bleak outlook, however, there currently doesn’t appear to be any appetite for any broad tax increases (personal income, business, sales, etc.).