In a development that is sure to affect school funding, the drumbeat of bad fiscal news from statehouses is intensifying, reports Stateline.org: States collectively faced deficits of $40.3 billion in writing their current budgets. That’s triple the $13 billion shortfall states weathered the previous year, a new report released July 23 shows. "The overall state fiscal condition changed significantly in the past year, and for the most part deteriorated," Corina Eckl, director of fiscal affairs for the National Conference of State Legislatures, said as she released the report during the organization’s conference in New Orleans. State lawmakers knew revenues would drop, but the decline was worse than expected. In April, 23 states had projected budget gaps totaling $26 billion for fiscal 2009, which began July 1 in all but four states. By June that number rose to 31 states, NCSL said. The troubled budget picture, which exists in all but about a dozen energy and farm states, is driven largely by reduced revenues, Eckl said…

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