Posted on 03/07/2002 10:25:26 AM PST by SierraWasp
Budget crises could affect state's ratings
State budget deliberations for 2003 are going to be difficult and in some cases the results could affect state ratings, says Standard & Poor's in its "State of the States" report published Tuesday.
Since the last "State of the States" report, in October 2001, many states have seen revenue weaken. Since October, Standard & Poor's has placed New Jersey, Tennessee, Wisconsin and Colorado on credit watch with negative implications, and California, Indiana and Kentucky now have negative outlooks.
"While states whose ratings are now at risk for downgrade are spread across the U.S. and have different economic profiles, spending reductions continue to be the primary focus of restoring balance for most states," said analyst Robin Prunty. "Very few states have viewed broad-based tax increases as a means to address budget imbalance."
Standard & Poor's says that the collective budget gap facing the states could be as high as $30 billion. California alone faces a multibillion dollar gap.
The full report, "State of the States: Fiscal 2003 Presents Many Challenges," is available on Standard & Poor's Web site, www.standardandpoors.com.
Oh, don't be too hard on him, I married a beautiful "Arky."
This creep:
The first thing both liberal Demonicrats & liberal Repellicans do when they don't like an idea is to give it a smear label! When they can't deal with it honestly, they invent slogans and smears to marginalize it immediately.
As a newly elected county official, I was trying to get folks to consider a national sales tax to be collected by the elected County Treasurer/Tax Collector, keep what the County needed, send the balance to the State, if any, so they could keep what they needed and if any was left over, they could send it on to the Feds for national defense, etc.
Now that's "Devolution!" But it's an idea whose time had not yet come.(sigh) The Gingrich revolution was snuffed by Tim McVeigh and whomever he was working with so Clinton, Clinton, Gore & Reno could lather up the media to suffocate any good ideas eminating from Local Government.
I used to quote Thomas Jefferson who said, in effect, "Each of the States shall be further divided into Counties, each to govern what lies within it's bounds." When you smear that with "County Supremacy Movement," it makes it sound so much like a "White Supremacy Movement." PC wins again!!!
A few weks of that on the Spanish only stations and its ours...
Cartoon by Mike Shelton of the Orange County Register
Mr. Parsky come out from behind the curtain... The Presidential Connection to Rearden!
C.O., I believed ya all along. It's just that I had never seen this guy in the paper, before.
Hay Ernest, if'n ya go hea an look aroun at alla the libural publishin that Dumbstruck Davis is jus lickin his libural lips an windin up ta throw a brush-back, then 3 consecutive stikes ta end the inning before it even starts... Blah, Blah, Bobalouie.
I guess they think we elected the poor bastard and now "W" an Rudy an even us worms down here in the grassroots are just gonna dummy up an do nuthin ta hep 'im!!!
I think sumthin based on him "Maxin Out" the Credit Card we let him use on a whole buncha nuthin would be really catchy. It could feature an Arthur Anderson Auditor lookin all over the State for whatever it was that he was supposed to have spent it on. For example, that surplus coulda built a beautiful dam on the American River at Auburn, CA!!!
Of course we never had a "surplus!" What we had with Dumb Dumb Davis was... SURPLUS GOVERNMENT!!! Now we got a State Government that SUCKS BONDS!!!
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I can see in the near future for any of us who live in Kali, and as we go shopping the following scene happening to all of us living in Kali..
As we walk back to our cars, a shady and grimy gray skeleton like individual gets in front of us.
Suddenly, he starts to unbutton his grimy gray raincoat.
We turn our women and children away from this grimy gray creature unbuttoning his grimy gray rain coat.
Then, we hear this grimy gray creature whisper, "Hey buddy, you want to buy some Kali energy bonds, cheap, 2 cents on the face value?"
At that time we realize who this stinking, grimy gray indidual is. It is the cadaver looking and acting Facist Davis. He is out trying to peddle his Energy Bonds that no sane individual will even think about buying!
We grab our Pepper Spray can and point them at him. He fades back into the background muttering I'm pro Abortion, and I love Gay predators and children.
We grab our children and women and run for our SUVs after this close call with the stinking grimy gray Davis!
Or the quick summary, "Psst buddy! Want to buy some Kali Energy Bonds. Only a penney on a dollar!"
Traditionally, the state uses its own reserves -- including borrowing from special funds -- and various forms of short-term commercial loans to maintain sufficient cash. Sometimes, however, the cash demand exceeds the yield of those management tools, and the state simply runs out of money to pay its bills. This may be one of those times -- primarily because when the state enjoyed huge reserves earlier this year, Davis and the Legislature spent billions of dollars to buy power on behalf of the state's nearly bankrupt utilities.Technically, those power purchases were loans from the state's general fund to a special power purchase fund and are supposed to be repaid by utility ratepayers. The general fund is still owed more than $6 billion, and for months, Davis and other state officials have been pushing the sale of $12 billion in ratepayer-financed bonds to replenish the general fund and finance future power purchases. But the bond sale is on indefinite hold because Public Utilities Commission President Loretta Lynch has refused to approve rates to pay for it, saying the pricey power supply contracts should be renegotiated.
Even if the Legislature approves Davis' proposed spending reductions, the state is looking at a cash-flow deficit by June of as much as $2 billion -- unless the power bonds are floated, according to projections made by legislative number-crunchers. And if it becomes reality, it creates a dicey political scenario involving Davis and his archenemy, state Controller Kathleen Connell.
Short-term cash squeezes may be covered by borrowings through "revenue anticipation notes" (RANs) issued by the administration and state Treasurer Phil Angelides. But longer-term loans to cover cash-flow deficits, particularly those that run over more than one fiscal year, involve "revenue anticipation warrants" (RAWs), and only Controller Connell can initiate and approve those.
The last time RAWs were issued was eight years ago, when a similar squeeze led to $4 billion in RAWs that were repaid over two years.
The controller then was Davis and, with his eyes already fixed on running for lieutenant governor and then governor, Davis made the most of his rare opportunity to participate directly in budget politics. He castigated then-Gov. Pete Wilson, who was seeking re-election at the time, for relying on phantom revenues and insisted on special spending-reduction "triggers" to assure repayment of the RAWs.
"We've had to jump through hoops to make the governor's budget work," Davis said as he sold the RAWs in July 1994. "He seems to think he can balance a budget on wishful thinking rather than reality."
If Davis doesn't accede to Lynch on the bonds, he may have to deal with Connell on the RAWs, giving her an opening to critique the fiscal performance of a governor with whom she has feuded for seven years. And if Davis tries to use some questionable, Wilson-like budgetary tricks -- such as counting on the federal government to cover more than a billion dollars in post-Sept. 11 security costs -- Connell will have an opportunity to do to him what he did to Wilson, making him jump through the hoops for the election-year RAWs.
The irony could not be sharper.
WHAT GOES AROUND COMES AROUND!
Justice, that is for sure!
An interesting question will be whether all these folks want to cooperate with Davis to help him get re-elected, or whether they'd prefer to have Simon in there.
From their perspective, it might be in their long-term interest to dump all these problems in Simon's lap and they do everything possible to make him fail.
They think he's arrogant and... HE IS!!!
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