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Link to December 5 Stateline.org post, "State budget gaps balloon to $97 billion".

Excerpt:
Still reeling from high gas prices this summer and plummeting retirement savings this fall, Americans will soon be feeling the pinch in other ways — from increased tuition to potentially higher taxes, as states try to close some $97 billion in budget gaps over the next two years.

States will have to find additional spending cuts of $32 billion for current budgets before even beginning to tackle $65 billion in deficits shaping up for the next fiscal year, the National Conference of State Legislatures reported Dec. 4. States have already closed a $40 billion gap since the start of the fiscal year, which was July 1 for all but four states.

"These budget gaps are approaching those seen in the last recession, which were the worst since World War II, and show every sign of growing larger," William T. Pound, NCSL's executive director said in a statement.

Legislatures will either have to raise taxes or cut programs since, unlike the federal government, states must balance their budgets. The poor, in particular, face the prospect of losing government-sponsored health care coverage or reduced-priced lunches at school.

Arizona is expecting a budget gap in 2010 that will exceed 24 percent of its general fund budget. Other states expecting huge budget holes include: New York (20 percent), California (18 percent), Wisconsin (17.2 percent), Minnesota (14.7) and Kansas (14.5 percent), according to the NCSL report.