What's Next After States Miss Budget Deadline?

Many states failed to pass a budget by a Friday, June 30 deadline. NPR's Michel Martin speaks with John Hicks, executive director of the National Association of State Budget Officers about the impact.

MICHEL MARTIN, HOST:

Today marks the first day of a long Independence Day weekend. That means a lot of people will be getting some much-needed time off. But in some states, there might be an unwanted break of uncertain duration. Last night marked the deadline for most states to adopt a budget for the coming year, but a number of states didn't make it. Maine and New Jersey are facing government shutdowns after their state governments failed to reach a budget deal. Illinois and Connecticut also couldn't come up with a new budget before their new fiscal year started.

We wanted to know why this is happening and what this means, so we called John Hicks. He is the executive director of the National Association of State Budget Officers. That organization advises state governors on their finances. And he was nice enough to join us at our NPR headquarters in Washington, D.C. John Hicks, thank you so much for coming in.

JOHN HICKS: Thank you, Michel, for having me.

MARTIN: What happens now for states that couldn't pass a budget last night?

HICKS: Well, as you've mentioned, there are four states who are going to have a partial shutdown. In total, there are eight states that haven't fully passed their budgets. Wisconsin and Rhode Island, Massachusetts and Delaware also did not, but they have put in temporary situations in order to carry them through, in Delaware's case, up through the week. There are really fiscal struggles going on right now with states. State revenues are not growing at the level of the economy. And there are a lot of difficulties in putting budgets together.

And then in some states combined, there are political differences. You know, in the case of New Jersey, there's one primary issue that at the very end of the process has held things up and crawls to stalemate. And those things get put together at the very end of legislative sessions. The chambers, the House, the Senate, the governors, they don't always disagree. There are very tough choices that have been made, and sometimes those boil over into a disagreement.

MARTIN: Is this unusual, though, to have this many states be unable to agree on their budgets by the middle of the year? I mean, presumably by this point, they've been working on this for six months now. And have you ever seen anything like this?

HICKS: This is a high number, yes. I can't say it's unprecedented, but in recent years, yes, this is an unusual. And I think it is the combination of we're in the eighth year of an economic recovery, but state revenues haven't recovered as well.

It's been a slow recovery economically. It's been a slower recovery for states. Half the states are still not spending at the level before the Great Recession when adjusted for inflation. So tough choices are being made right now. And that has been a primary issue for the number of states that have ended the year without a budget.

MARTIN: Is partisanship, though, a part of this? I'm not quite sure, you know, what's the neutral way to describe it. You know, some people are calling it sort of toxic partisanship. Other people say this is divided government. It kind of reflects divisions in the electorate on the whole. What do you say to that?

HICKS: Yeah. Divided government is often a symptom of late budgets and disagreement. But in the case of Wisconsin, you know, there isn't a divided government. They haven't agreed on the final things, particularly about transportation, education funding.

And in New Jersey, the two chambers of the legislature are democratic. And one of the chambers is in agreement with the governor's approach and the other is not. So each House of the legislatures are their own body. And sometimes even when they're in the same party, they really have disagreement.

MARTIN: What is likely to happen in these states if these - if the state governments can't come to agreement on this? What happens?

HICKS: The legal structure of the state will kind of guide what can stay open. The governors of Connecticut and New Jersey have issued kind of emergency declarations. The governor of Maine the same thing, identifying essential services and what is open and what will be closed.

Public health and safety is typically one area that is held out, well, you know, there will be state police on the roads. There will be public health availability, but it can vary. It's a function of the state's court's interpretations of the powers of the executive without a budget and also state laws.

MARTIN: That's John Hicks. He's the executive director of the National Association of State Budget Officers, and he was nice enough to join us here in our studios in Washington, D.C., on this Independence Day weekend. John Hicks, thank you so much for speaking with us.

HICKS: Thank you for inviting me.

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