European Stars And Stripes (Newspaper) - February 1, 1981, Darmstadt, Hesse                                Doily Magazine the revolt begins to Pinch by John Herbers new York times the citizens tax revolt of the late 1970s is for the first causing substantial reductions in state and local services around the for several years Treasury surpluses in a num ber of states cushioned the Impact of the tax spending limits and rebates to citizens demanded by the but a Check of representative state capitals found that most Legislatures meeting this month Are facing a shortage of revenues that has or is expected to layoffs and reductions in Many areas of the moment of truth is upon Edmund Brown told the California legislature in his budget message when the current fiscal year ends june he the state will have nothing left of a surplus that once approached the governors spending proposal represented a Rise of Only million from the current billion which he said was not enough to keep Pace with state officials tended to blame economic conditions for the fiscal but they conceded that they would have been better off if revenues had not been restricted by tax cuts after several years of relative in recent years the states had improved their fiscal positions compared with cities and the Federal govern but in the last year or so their revenues in constant dollars have been some states with Strong economic such As Are reported to be relatively Well but in most state capitals there have been Calls for retrenchment and intense debates Over which services to widespread reductions appear certain in health care and social in the construction of buildings and other capital projects has been dormant for some a situation that is not expected to change in the foreseeable a state that has enjoyed expanded economic and population growth and that pioneered the tax offers a prime in june californians voted for proposition which reduced property taxes billion a the vote gave impetus to tax cutting trends that had been under Way in other the states Revenue drop was also partly caused by an tax Cut in under which taxes were indexed to prevent taxpayers from moving into a higher bracket because of inflation some however realized an actual Cut As As a Brown is proposing cuts in in part by restricting pay increases for state employees and by reducing welfare and medical allocations to local gov there is a Strong move in the legislature to repeal automatic costo living raises for welfare Moth the Blind and the in the Middle where there has been High unemployment and a decline in the Quality of the Industrial californian prospects look Rosy by which has already made extensive cuts in a Range of services and where school shutdowns have have been is expecting a million deficit for the next fiscal the school budgets Are expected to undergo yet another because of the depressed automobile Indus try and several tax Cut has undergone deep cuts this year and is projecting More cuts in social the state development of natural labor and Commerce for the next fiscal although Michigan fiscal woes Stem chiefly from the economic Wisconsin and Minnesota would not be in serious trouble if not for tax cuts and Minnesota is facing a billion deficit despite cuts in services ordered last year by Albert the governor has said the state must trim its welfare Rolls in a Loving and caring and a state and local budget surpluses tin billions of dollars for All so states new York times major Battle on that Issue is expected in the legis in 1979 Minnesota in response to pressures to Cut voted million a year in tax including reduction in income and property in addition to tax reductions and the economic slow All the states have been eliminated from the Feder Al general Revenue sharing beginning this they have suffered from Sharp rises in the Cost of medi the medical insurance program for the and they have lost Revenue for highways because of a decline in the consumption of which is taxed by the gallon rather than As a percentage of its there have been proposals to increase the gasoline tax in a number of but the resistance has been so Strong that any increase has been states in the which have been undergoing fiscal pressures since when Hugh Carey of new York delivered his admonition that the Days of wine and roses Are appear to be adjusting some what in part because there have been fewer tax cuts austerity is the order of the the new governor of William sounded the theme prevalent in almost every state when he told the legislature in Hartford that it seems we have Only one Choice curb spending and control Taxa to help make up an anticipated shortage of he among other cutting Aid to local Carey told the legislature in Albany on the same Day that he intended to propose a Broad tax Cut and a 10 percent Rise in welfare but at the same time he said there would have to be cuts in some which he did not late last he told local governments not to expect an increase in state Aid this and because of Infra no increase Means a where voters approved a drastic Roll Back in property taxes 4 and where there was no surplus in the state is undergoing deep cuts in a Range of including Public schools and municipal labor some of the More prosperous states also face significant Arizona expects a shortage in revenues of up to million because it eliminated the sales tax on food and increased Aid to financially troubled school As a building projects have been Frozen and out lays to higher education have been despite the importance of such programs to the states rapid Many governors Are also complaining that medicaid costs have become particularly burdensome because of the Rise in medical without comparable increases in the Federal contributions to the medicaid in new which expects to spend Mil lion this year on costs have gone up 14 percent in the last year and there will not be enough tax revenues to pay for the states medicaid administrators plan to ask the legislature to make up the anticipated a similar problem exists in but William Clements is considering a billion property tax around the nation there is still More talk of tax cuts rather than As a result Many officials believe the end of the fiscal troubles is not yet in february 1981 the stars and stripes Page 9