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The days of money flowing in to state governments due to new construction, both residential and commercial, are coming to an end. The flow of impact fees, transfer fees, capital gains taxes, etc. have slowed the revenue stream for the state governments.

As we have talked about previously, state governments did not have any restraint during the big money years of the housing boom. Instead of socking some of the money away for a rainy day, they created new vote buying programs and built shrines to themselves.

Now that the housing slowdown is in full form, these same government officials are crying poverty. Now do not expect them to dismantle the edifices of waste and excess that they erected during the hey-day.

Nope, these moronic legislators will instead cut important services that help maintain property values like school funding. So instead of getting rid of the bus for senior citizens that takes them to the brand new senior center, they will threaten to get rid of the local high school football team knowing full well most in the community will take a tax hike before that happens.

What smart taxpayers should do is start petitions against their local politicians for squandering the extra money they brought in during the real estate boom. That would teach these politicians a lesson in budgeting and restraint.

Top 10 States With Biggest Tax Revenue Shortfall

Rank State Annual Tax Rev Change

1. Arizona -13.6%
2. Florida -10.3%
3. Rhode Island -6.2%
4. Nevada -4.9%
5. Georgia -3.8%
6. New Jersey -0.3%
7. California 0.1%
8. Washington 0.2%
9. Delaware 0.3%
10. Tennessee 0.6%

via Business Week and the Rockefeller Institute For Government

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1. Local Municipalities Losing Millions in Property Tax Revenue
2. Federal Bailout Money Going Straight To Bottom Line, Not To Loans
3. Top 10 Fastest Growing States in the United States 2007-2008
4. Boston Looking To Provide Seed Money For Commercial Construction
5. One in Nine Homes Are Vacant in the United States