A sweeping economic turnaround could mean tax cuts and better service for millions of Americans. For the first time since the year 2000, many states are finding that budget time isn't all about belt-tightening and cost-cutting.
States collected a record $600 billion in taxes last year — an increase of 17.2 percent over 2003. Revenues are rising even faster this year, at a double-digit rate in some states.
Instead of fighting about how to cut their budgets, state lawmakers must decide how best to use the additional revenue.
Driven by higher consumer sales and personal incomes, tax revenues are up in states nationwide. Governments are using the money to improve roads, cut class sizes and give tax breaks to businesses.
With tax revenue up 16.5 percent this year, the Arizona state government is spending $7 million to build a new medical school, $4 million to recruit new nurses and $30 million to entice moviemakers to the state.
In Nebraska, where revenues are up 11.6 percent, more state troopers are being hired. In California, up 8.5 percent, state officials are restoring a property tax cut for seniors. And in Utah, where final numbers are not yet available, officials are spending more to promote tourism.
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