State shutdowns loom as deadlines near

At least 19 states still have to approve their fiscal 2010 budgets before next Tuesday. If they don't, staffers might not be paid and services might shut down

NEW YORK (CNNMoney.com) -- One week and counting. An unprecedented number of states have only days left to pass their fiscal 2010 budgets.

At least 19 states are still hammering out their spending plans as the recession wreaks havoc with their finances and sparks fights between governors and lawmakers. If spending plans aren't approved, state workers may not receive their paychecks and some government offices may shut down.

"A lot of states are coming down to the wire," said Todd Haggerty, research analyst for the National Conference of State Legislatures. "More than what's typical. The unprecedented economic situation is creating a lot of difficulty this year."

Some 46 states end their fiscal years on June 30 and all but one require balanced budgets be adopted.

"She doesn't think much of what's in them," said Paul Senseman, the governor's spokesman.

Arizona Senate President Bob Burns is also confident that the two sides will reach an agreement and avoid a government shut down. The two branches are meeting daily, a spokeswoman for Burns said.

In some states, the leaders aren't even talking. Pennsylvania's governor and Senate Republicans, who have to close a $3.2 billion gap for the current year, are not negotiating on their budgets.

"There's been no significant movement on the budget," said Chuck Ardo, press secretary for Gov. Ed Rendell, who is prepared to cancel his African safari in August if the budget isn't set.

The governor's $28.4 billion budget seeks to raise the personal income tax rate by half-a-percentage point and draining the commonwealth's $750 million rainy day fund. Senate Republicans' $27.3 billion plan looks to cut spending on areas such as education and community revitalization.

Though the states has never passed a budget on time during Rendell's seven years in office, both sides agree this year is the worst standoff ever.

"It's hard to see how a meeting would be productive given the two very different points of view," said Erik Arneson, communications director for Senate Majority Leader Dominic Pileggi. "At this point, there's no support in our caucus for a tax increase."

Sending IOUs instead of $$$

If states don't pass their budgets on time, one of three things usually happens, according to the National Conference of State Legislatures. Lawmakers can pass temporary appropriations measures to keep the doors open and bills paid. Some states have provisions that maintain funding for agencies and services even without a budget.

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