Budget insiders see worse ahead in Calif., Mich.

Two of the states hit hardest by the Great Recession—California and Michigan—are bracing for an even tougher time making ends meet next year, putting big spending cuts or outright elimination of some services on the table, top budget officials from both states said Friday (Nov. 13).

Michael Genest, the budget director for California Gov. Arnold Schwarzenegger (R), said his state faces a budget gap next year of at least $7 billion—and likely more—after eliminating $60 billion in red ink this year. The “nightmare scenario” for his state is that continuing revenue drops will spell severe impacts on government services or taxpayers in California, Genest said at an event sponsored by the Pew Center on the States.

Both California and Michigan were prominently featured in a new report issued this week by the Pew Center on the States, “Beyond California: States in Fiscal Peril.” http://www.stateline.org/live/details/story?contentId=436547

By Daniel C. Vock, Stateline.org Staff Writer

Full Story: http://www.stateline.org/live/details/story?contentId=437443