1. NOVEMBER 29, 2018
Truth and Integrity in State Budgeting: Preview Prepared by: William Glasgall
Executive Vice President and Director, State and Local Initiatives

2. Presented at the 2018 Rutgers Governmental Accounting & Auditing Update Conference

3. The Volcker Alliance Research Network
Universities
CUNY
Fla. International
Georgia State
U of Kentucky
U of California, Berkeley
U of Illinois-Chicago
U of Illinois-Springfield
U of Utah
Consultants
MMA
Barrett & Greene
New Products/Outreach
State Budget Report Cards
State Budget Data Lab
Fiscal Policy Conferences with Federal Reserve Banks, University Partners
Legislative Testimony and Technical Assistance
Forthcoming: Truth and Integrity in State Budgeting: Preventing the Next Fiscal Crisis
Follow-up Research:
Rutgers Business School
University of Minnesota
5 Partner Schools

4. The Volcker Alliance on State Budgets

5. Volcker Alliance State Budget Grades
States received average FY grades of A to D-minus, plus annual grades for each year. in five areas:
• Budget forecasting–how and whether states estimate revenues
and expenditures for the coming fiscal year and the long term;
• Budget maneuvers—dependence on one-time revenues to offset
recurring expenditures;
• Legacy costs—how well states fund promises made to public
employees for pensions and retiree health care;
• Reserve funds—the condition of general fund reserves and
rainy day funds and rules governing their use and replenishment;
• Budget transparency—disclosure of budget info, including
debt, tax expenditures, estimated cost of deferred infrastructure maintenance.

6. Best 3-Year Average Grades, FY 2016-18
Grades arranged by category

7. Worst 3-Year Average Grades, FY 2016-18
Grades arranged by category
Inadequate pension, OPEB funding & contributions drove NJ’s mark. Only KY has worse state pension funding. But its average grade rose to C from D- because it fully funded annual pension contributions in FY

8. New Jersey’s Budget Grades, FY 2016-18

9. Consequences of Delaying Tough Budget Choices
Debt, Pensions, OPEB Burdens Reduce Fiscal Flexibility

10. Consequences of Delaying Tough Budget Choices
Increased vulnerability to economic downturns

11. Questions?

12. Contact Information
William Glasgall
Senior Vice President and Director of State and Local Initiatives
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