States Well-Positioned to Combat Inflation, Slow Growth: Fitch

After two years of surging surpluses, state budgets are well prepared to weather the headwinds of rising inflation and slow economic growth, Fitch Ratings said in a report released Monday.

• Forty-eight states began FY 2023 with enacted budgets, an indication of strong revenues across the board, the report says
• A strong economy through FY 2022 supported growth in personal income and sales tax revenues, which are expected to slow in the coming fiscal year
• States used surpluses to bolster rainy day funds, increase appropriations for state employee salaries and K-12 education, and enact temporary tax holidays as well as permanent ...