Census Results and State Implications
Since 1790, the United States, as required by Article 1, Section 2 of the U.S. Constitution, has conducted a census every 10 years, tabulating the nation's population for the purpose of allocating congressional districts among the states. The census also is important due to its effects on the allocation of federal funds to state and local governments. Further, the data from the census still is used to allocate congressional seats among the 50 states and is used by the states to redraw the boundaries of political districts such as state legislative lines, city council lines and the like. The resident population of the United States on April 1, 2010, was 308,745,538, an increase of 9.7 percent over the 281,421,906 counted during the 2000 Census. The following table provides details on the congressional seat changes in the Southern region, and the 2010 Census site provides further manipulable data.
|State or Region||Representatives||Average Number of Constituents per Representative||Seats Lost or Gained|
How much federal funding did the SLC member states receive in fiscal year 2009?
|State||Total federal funding (in $1,000,000)||Percentage of total federal funding||Population as of July 1, 2009||Percentage of U.S. total population||Per capita funding|
Economic Impact of the Great Recession
The persistent economic slowdown following the Great Recession has impacted many sectors, both public and private, families and vast numbers of individuals throughout the nation, as well as the South. As indications of a recovery become apparent, there still are distressing indicators of the long-lasting effects of the Great Recession. Unemployment, which rose above 9 percent nationally for the first time since September 1983, peaked nationally at 10.1 percent in October, 2009, and has only fallen slightly (to 9.6 percent) in October 2010. More disconcerting than the total unemployment picture, however, is the number of Americans who are considered long-term unemployed, especially those who have been out of work for more than a year. In the second quarter of 2010, 31 percent of the 14.6 million jobless in the United States had been unemployed for 52 weeks or longer, a figure that amounts to 2.9 percent of the total labor force according to the Bureau of Labor Statistics. Prior to the start of the Great Recession in the first quarter of 2007, the number of long-term unemployed was only 9.5 percent of the total unemployed population (which was itself only 4.5 percent of the labor force). In addition, according to The New York Times, the overall average length of time for remaining unemployed in United States increased to a record 35.2 weeks this summer. The impact of long-term unemployment has compounded the unemployment picture in a number of ways, including increasing the number of applicants for food aid through the Supplemental Nutrition Assistance Program (SNAP, formerly Food Stamps) of the United States Department of Agriculture (USDA).
What are the retention and completion rates of college freshmen in the South?
Recent reports have highlighted the need for the United States, and the South in particular, to produce more college graduates in order to be more competitive globally. Other research has highlighted the costs to state governments of college students who begin college, but do not return to school for their second year. The South lags the rest of the nation slightly in both first year retention and college completion rates, although not by a significant factor. These two measures are closely related, as the first-to-second year transition is considered critical to higher education persistence. Virginia has the highest first-year retention and six-year graduation rates in the region at nearly 80 percent and 63 percent respectively. Oklahoma has the lowest first year retention rate in the region at 64.4 percent. Louisiana's 40.8 six-year graduation rate is the lowest in the region. For more information on higher education persistence, see Dr.Vasti Torres presentation and a summary of her remarks from the 64th SLC Annual Meeting in Charleston.
|State||Overall First-Year RetentionRate (%)||Six-Year Graduation Rate|
High Speed Rail: Update from the Southern States
U.S. Transportation Secretary Ray LaHood recently awarded the second round of federal grants to promote high-speed and intercity passenger rail in 23 states, including seven SLC states (Florida, Georgia, Missouri, North Carolina, Oklahoma, Texas and Virginia). While a bulk of the more than $2.4 billion in total grants were secured by California ($902 million) and Florida ($808 million), these federal disbursements for 54 rail projects scattered across the country will continue to enhance our nation's transportation infrastructure. The first round of rail grants were awarded by the Obama Administration (amounting to $8 billion) in January 2010 and funded by the American Recovery and Reinvestment Act (ARRA). The latest round of rail grants sprang from the U.S. Department of Transportation's Fiscal Year 2010 appropriations act.
State Policy on Compensation for Chief State School Officer
State Authorized Gaming
Permanent Property Rights Task Forces
Permanent Property Rights Task Forces or Commissions would seem to be rare. A number of states created temporary bodies to review state policy on eminent domain in response to the U.S. Supreme Court's decision in the Kelo v. City of New London case. Some states took the added step of establishing a permanent ombudsman responsible for resolving eminent domain disputes and abuse. In recent years, there has not been much legislative interest in eminent domain generally. The downturn in the economy has dampened much of the enthusiasm for public takings of private land for private economic development projects, thus reducing the friction that the Kelo case generated.
Following the Kelo decision, nearly 40 states took some action in response, including restricting the very kinds of developments that the City of New London undertook or strengthening and reinforcing public notice and the definition of both public purposes for which a property could be condemned or the conditions (blight) for which a public interest could be defined.
Washington State has an Eminent Domain Task Force located within the Office of the Attorney General. The Legislatively-created Task Force has continued to meet after its appointed term to monitor activity and make further adjustments to their recommendations. The Task Force issued its final report in 2009 making recommendations that would bar the use of eminent domain for private entities, reform the state's community renewal law, and seeking the adoption of best practices for the exercise of eminent domain. Another example of a state eminent domain task force can be found in Ohio, where the Task Force released its final report in 2006.
Agricultural Land Assessments
Every state except Michigan assesses agricultural land for tax purposes based on production rather than market value. In some states, this has lead to reports of abuse by developers and landowners claiming agricultural use for land being held for development purposes. A handful of states have taken steps to review this issue.
Florida has a handbook on ag land taxation that outlines the state's procedures, but does not indicate if it was updated to avoid abuse. The law was changed in 2002 to require an active, affirmative process for ag certification. The Florida Statute Section indicates a relatively rigorous standard to be met (see 193.461(3)(b)1-7), but it is still possible that the land could be called "forest" even if it was non-commercial varieties. Agicultural land sold for three or more times the agricultural assessment value is considered to no longer be in agricultural use and is assessed at the higher, market rate.
Colorado has a relatively high bar for establishing agricutural use, prohibiting horticulture if the plants aren't in the ground, 4-H, and pleasure horses. A recent report from the county government association indicates that the law has some deficiencies, and offers up some points where clarification would help (slide 24). The Legislature passed legislation creating a task force to review ag land classifications, which the governor signed. The report is due on the 15th of October (the Task Force only was formed in June).
South Dakota established a task force on agricultural land assessment in 2008.
State Fiscal Issues (remarks)
It is a great honor to be here and my thanks to Eric and the FDIC for extending this invitation to me and to The Council of State Governments. The Council, established in 1933 is non-partisan, serves all three branches of state government by fostering the exchange of insights, ideas and policies. While I work for The Council's Southern Office, the Southern Legislative Conference in Atlanta, the Council is headquartered in Lexington, Kentucky with regional offices in California, Illinois, New York and Washington, D.C.
My presentation this morning will cover five broad areas. Part I highlights the fiscal position of states in the aftermath of the Great Recession while Part II highlights some state strategies to balance budgets and generate revenue. Part III identifies several structural flaws in state tax systems that will continue to plague state finances going forward while Part IV explores some of the major expenditure categories looming on the state fiscal horizon. Finally, Part V hones in on some of the "green shoots of growth" and the promising economic development projects that will contribute toward reviving state economies.
Part I: The Fiscal Position of States
States continue to warily recover from the Grea t Recession, the longest, broadest and most severe economic downturn since the Great Depression. Even though the recession might have technically ended, the devastation caused by the Great Recession continues to batter state finances and will do so for a number of years. The concurrent crises the U.S. economy faced during the Great Recession – output declines, revenue shortfalls, credit freezes and confidence drops--completely destabilized state economies. It was almost as if Hydra, the multi-headed monster bore down on the U.S. economy.
How have the Southern states performed in personal income growth in 2010?
|State||1st Quarter, |
|2nd Quarter, 2010 (preliminary) a||Percent |
Deadline to Secure New Federal Funding Promoting Small Businesses Imminent
Southern Legislative Conference of The Council of State Governments
The federal Small Business Jobs Act of 2010 is designed to generate critical resources to help small businesses drive economic recovery and create jobs. An important component of this new legislation involves the State Small Business Credit Initiative (SSBCI), a formula grant program structured to assist local entrepreneurs and small business owners secure the necessary credit to expand their businesses, create jobs and generate revenue. Specifically, the SSBCI provides $1.5 billion in federal funding to states to initiate programs that expand credit opportunities for small businesses. State commitment to involve the private sector in implementing these programs remains a critical element of the SSBCI, and states are required to demonstrate and help facilitate $10 in new private lending for every $1 in federal funding. In total, it is anticipated that the $1.5 billion federal commitment will lead to a minimum of $15 billion in additional private sector lending to spur small businesses.
Given the urgency relating to releasing credit to worthy small business operations to drive economic growth, there are a number of tight deadlines associated with states accessing the SSBCI funds. These deadlines include the following:
Of note, if a state fails to file a Notice of Intent (by November 26, 2010) or an Application (by June 26, 2011), municipalities in the state have until September 26, 2011, to present the necessary paperwork for accessing SSBCI funds in lieu of the state. In addition, while small businesses are the sole beneficiaries of these SSBCI funds, states may contract with not-for profit and for-profit organizations to actually implement the programs.
In the SLC states, what percentage of homeowners have Negative/Near Negative Equity and what are the latest unemployment rates in the region?
Negative Equity by SLC States, 2nd Quarter, 2010
(Click header to sort each column)
|State||Percent of Mortgages with Negative Equity||Percent of Mortgages near Negative Equity|
Source: CoreLogic, Negative Equity Report Q2 2010, August 26, 2010
(Click header to sort each column)
|State||Civilian Labor Force||Number Unemployed||Percentage Unemployed|
How much DOE Recovery Act Funding has been allocated to Southern states?
(Click header to sort each column)
|State||Total Awarded||Total Outlays||Percent of SLC Total Awards||Percent of SLC Total Outlays||Percentage of U.S. Total Awards||Percentage of U.S. Total Outlays|
State Fiscal and Economic Outlook (remarks)
It is a great honor to be here and I thank Commissioner Sviggum and the National Association of Governmental Labor Officials for extending this invitation to me and to The Council of State Governments. The Council, established in 1933, serves all three branches of state government by fostering the exchange of insights and ideas. While I work for The Council's Southern Office, the Southern Legislative Conference in Atlanta, the Council is headquartered in Lexington, Kentucky with regional offices in California, Illinois, New York and Washington, D.C.
My presentation this afternoon will cover five broad areas. Part I highlights key national economic trends and the fiscal position of states while Part II highlights some of the strategies being deployed by states to balance budgets. Part III identifies several structural flaws in state tax systems that will continue to plague state finances going forward while Part IV explores some of the major expenditure categories looming on the state fiscal horizon. Finally, Part V hones in on some of the "green shoots of growth" and the promising economic development projects that will contribute toward reviving state economies.
Part I: Key National Economic Trends and the Fiscal Position of States
The U.S. economy continues to warily recover from the Great Recession, the longest, broadest and most severe downturn since the Great Depression. Even though the recession might have technically ended, the devastation caused by the Great Recession continues to linger and will continue to do so for a number of years. What was most disconcerting about the Great Recession was that the U.S. economy had to face concurrent crises on multiple fronts: output declines, revenue shortfalls, credit freezes and confidence drops. While any one of these negative developments has the potential to stall the economy, the fact that they all occurred concurrently completely destabilized it. It was almost as if Hydra, the multi-headed monster bore down on the U.S. economy.
What are the firearms laws in the SLC states?
On June 28, 2010, the U.S. Supreme Court held that handgun bans in Chicago and Oak Park violated the Second Amendment of the U.S. Consitution. While federal legislation receives much more media attention, state legislatures make many more decisions regarding their constituents rights to own and carry firearms. The following chart compiled by the National Rifle Association lists the main provisions of state firearms laws.
|State||Gun Ban||Exemptions to the National Instant Check System (NICS)||State Waiting Period for Handguns||License, Permit or Other Prerequisite for Handgun Purchase|
|Arkansas||--||Right-to-carry permit holders exempt from NICS; permits issued on and after 4/1/99 qualify||--||--|
|Florida||--||--||3 days; does not apply to a person holding a valid permit or license to carry a firearm||--|
|Georgia||--||Right-to-carry permit holders exempt from NICS||--||--|
|Mississippi||--||Right-to-carry permit holders exempt from NICS; permits issued to security guards do not qualify||--||--|
|Missouri||--||--||--||A purchase permit is required for a handgun, must be issued to qualified applicants within 7 days, and is valid for 30 days|
What are the enrollment and state expenditures for preschool in the South?
In the 2008-2009 school year, 1.2 million children were enrolled in state-funded pre-kindergarten programs in the 38 states that fund preschool.Total state spending nationally on preschool was in excess of $5 billion, with an average per pupil state expenditure of $4,143.The South leads the nation in preschool enrollment, with more than half (599,048 out of 1,046,752) of all 4-year-olds enrolled in state-funded preschool served by programs in the 15-state region.Unsurprisingly, the region also spends more on preschool than any other region, with state expenditures of $2.3 billion in 2008-2009, although the region's average per-pupil expenditure of $3,912 is below the national average of $4,143.When ranked by the percentage of 4-year-olds served by some preschool program (state Pre-K, special education and Head Start), the South has seven of the top ten states (Oklahoma, Florida, Georgia, West Virginia, Texas, Arkansas, and South Carolina).Oklahoma continues to serve the largest percentage of 4-year-olds at 71 percent, followed closely by Florida at 67 percent and then Georgia with 53 percent. These three states, along with Vermont (53 percent) and West Virginia (51 percent) serve more than half of their 4-year-olds in state pre-K. Only one state in the region, Mississippi, does not have a state-funded preschool program. The table below provides the percentage and number of four-year-olds enrolled and total state expenditures for the South.
(Click header to sort each column)
|STATE||PERCENT OF 4-YEAR-OLDS ENROLLED IN STATE PRE-KINDERGARTEN (2008-2009)||NUMBER OF 4-YEAR-OLDS ENROLLED IN STATE PRE-KINDERGARTEN (2008-2009)||STATE $ PER CHILD ENROLLED IN PRE-K||TOTAL STATE PRESCHOOL SPENDING IN 2008-2009|
What education benefits are available for National Guard members in the SLC states?
|Alabama||Tuition reimbursement of $500 per semester or quarter, up to $1,000 annually.|
|Arkansas||Up to $5,000 per year in accredited Arkansas institutions, based on student status and available funding.|
|Florida||100% tuition at any state college or university, for undergraduate degree only. Members also can apply for a $1,000 scholarship sponsored by the National Guard Officers Association of Florida (NGOA-F).|
|Georgia||Up to 100% tuition not to exceed $2,790 per year; $1,395 per semester; $116.25 per semester hour; or $77.40 per quarter hour.|
|Kentucky||100% tuition at any state college or university or vocational school in pursuit of undergraduate degree or completion certificate, respectively.|
|Louisiana||100% tuition at any state college or university, including 46 vocational technical schools, for up to 15 semesters.|
|Mississippi||Up to $4,500 per school year at any state college or university.|
|Missouri||Up to 100% tuition assistance. All members can take up to 15 credits hours per semester for 10 semesters at University of Missouri.|
|North Carolina||Up to $4,500 per year for tuition and books for members attending colleges or universities in North Carolina.|
|Oklahoma||100% tuition at any state college or university. Must be at least part-time student.|
|South Carolina||Up to $4,500 per year toward repayment of student loans while currently enrolled in college.|
|Tennessee||Yearly $1,500 scholarship competition by the National Guard Association of Tennesee (NGAT).|
|Texas||100% tuition reimbursement for up to 12 hours per semester for 10 semesters.|
|Virginia||Up to 100% tuition at any state college or university.|
|West Virginia||Up to 100% for in-state tuition and fees rate at any state college or university. In-state rates for out-of-state students at state-supported institutions.|
Which SLC states have codified judicial advisory councils?
|State||Entity||Code Section / Site|
|Alabama||Judicial Conference||§ 12-8-1|
|Judicial System StudyCommission||§ 12-9-1|
|Alabama Sentencing Commission||§ 12-25-1|
|Arkansas||Arkansas Judicial Council||Homepage|
|Florida||Judicial Management Council||AOSC06-62|
|Georgia||Judicial Council||§ 15-5-20|
|Kentucky||Judicial Council||§ 27A-110|
|Louisiana||Judicial Council||§ 13-61|
|Judicial Performance Program||§ 13-84|
|Mississippi||Judicial Advisory Study Committee||§ 9-21-21|
|Missouri||Judicial Conference||§ 476-350|
|North Carolina||State Judicial Council||§ 7A-409|
What percentage of residents in the SLC states lack health insurance?
While the South generally is considered to be the unhealthiest region of the country,putting up the highest obesity rates, percentage of people who smoke, and children who do not receive recommended vaccinations, among other health difficulties, [i] it also is oneof the least insured regions of the country. Althoughmost SLC states saw an increase of insured persons from 2007-2008, the percentage of people lacking health insurance currently living in Southern states(18.3%) still far exceeds the national average (15.4%), as well as averages in other regions of the country. The South also contains three of the top fivestates for percentage ofresidents without health insurance. With a healthcare reform debate raging in Congress, SLC states are watching closely to see what measures will be necessary to ensure more of their citizens have insurance and,correspondingly, access to adequate healthcare services
|Total Population||Population with Health Insurance Coverage||Population without Health Insurance Coverage|
|State||2007||2008||Percent Change: 2007- |
|2007||2008||Percent Change: 2007- |
|2007||2008||Percent of 2008 Total Population||Percent Change: 2007- |
State Unemployment Insurance: Recent Trends (remarks)
As the national economy warily recovers from the Great Recession, state finances continue to face monumental challenges in grappling with the sharpest drop in tax receipts in decades. And, even after slashing their budgets substantially in fiscal year 2009, states are staring at new mid-year gaps that have opened up in the current fiscal year (2010) with more gaps forecasted for fiscal years 2011 and 2012. While none of this is new information, what makes the state fiscal outlook quite daunting is that the current revenue shortfalls and huge budget gaps masks a number of enormous fiscal challenges looming in such areas as healthcare, education, public pensions, emergency management, infrastructure, transportation and unemployment insurance. States will have to contend with these significant challenges once the current crisis abates.
My goal this morning is to focus on one of these sizable spending categories – unemployment insurance – and provide a snapshot of where states stand, how states ended up here, what states are doing to deal with the ongoing crisis and highlight a model state program that might be replicated.
Part 1: Where Do States Stand?
The nation's unemployment insurance program emerged out of the Great Depression when in 1935 President Roosevelt settled for a compromise plan that allowed states the option of participating in the program while maintaining a great deal of latitude in devising the specifics of their plans. Some states, such as Wisconsin, already had their own unemployment program before this federal initiative while others introduced their plans later. The major objective of the program still revolves around functioning as an automatic economic stabilizer: providing the unemployed funds to take care of essential expenditures, thereby maintaining household purchasing power and ensuring economic activity during a downturn or recession.
What are the revenue estimates for fiscal years 2010 and 2011 in the SLC states?
As states warily recover from the Great Recession, there has been a great deal of interest in state revenue estimates. In recent years, state revenues experienced their steepest drop in decades, and forecasts for the next two fiscal years indicate that states still will face serious challenges in fully funding the entire range of governmental programs and services. The following table provides further information regarding the revenue estimates for FY 2010 and 2011 for the member states of the Southern Legislative Conference.
(Click headers to sort by state or percent change)
|State||FY 2010 Revenue Estimate||FY 2011 Revenue Estimate||Percent Change||Source|
|Alabama - |
Education Trust Fund
|$5,324,000,000||$5,290,000,000||-0.64%||Legislative Fiscal Officer December 14, 2009, Presentation to the Legislature on Alabama's financial condition|
|Alabama - General Fund||$1,449,223,181||$1,352,490,000||-6.67%||Legislative Fiscal Officer December 14, 2009, Presentation to the Legislature on Alabama's financial condition|
|Arkansas||$4,587,800,000||$4,498,300,000||-1.95%||Department of Finance and Administration|
|Florida||$20,693,200,000||$22,097,000,000||6.78%||State of Florida Three Year Revenue and Expenditure Outlook Fiscal Year 2010-11 through 2012-13|
Which SLC states have drug recycling programs?
While federal guidelines simply insist that prescription drugs be thrown in the garbage or flushed down a toilet (if the prescription specifies that this is environmentally safe), states have actually done a lot on developing recycling programs.Currently, 38 states in the nation have laws and programs that create prescription drug "recycling," "repository" or "redistribution" mechanisms for unused medications.Generally, these laws include restrictions for ensuring purity and safety of the products, in order to protect the patient that will ultimately obtain the drug.This means that, in general, states require that drugs not be expired; have a verifiable (future) expiration date; not be "controlled substances" (i.e., illegal drugs); and be verified by a state-licensed pharmacist or pharmacy.Also, the person who is to receive the medication must have a valid prescription from his or her doctor.
Below are summaries of the laws that have been enacted in the 15 SLC states.Many states (e.g., Louisiana, Missouri) first passed laws that authorized the practice of redistributing medications, and then went back and actually created programs to collect and redistribute the drugs from and to the appropriate entities.Alabama, North Carolina, South Carolina, and West Virginia currently do not have legislation pertaining to this issue.In fact, South Carolina has legislation that restricts the practice.North Carolina, however, has been investigating the prospect of creating a program. Where available, the bill numbers have hyperlinks that can be clicked to view the full text of the legislation.
|Arkansas||In 2005, the state passed a law (HB1031) that allows reuse of drugs that are in their original sealed or tamper-resistant packaging. Donated medications can only come from nursing facilities, and they can only be distributed through charitable clinic pharmacies to appropriately screened and qualified indigent patients who are not eligible for Medicaid but cannot afford private health insurance.|