For the nation as a whole, the projections indicate that state revenues will be 5.7% lower than the level required to maintain current services.
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Personal income, a broad measure of the economy, is projected to grow at an average annual rate of 4.5%. |
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State and local spending needed to maintain current services is projected to grow a bit more slowly than the economy, at an average annual rate of 4.4%. |
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Revenue, by contrast, is projected to grow considerably more slowly than the economy, at an average annual pace of only 3.7% (see Figure 1). |
| Figure 1. |
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| Factors Incorporated in Developing Base Case 8-Year Projections (2005–2013) |
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| Source: Donald Boyd, State Fiscal Outlooks from 2005 to 2013: Implications for Higher Education (Boulder, CO:NCHEMS, 2005). |
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