(snip)"Muni Watch:

April 15 – Wall Street Journal (Conor Dougherty): “State and local sales-tax revenue fell more sharply in the fourth quarter of 2008 than at any time in the past half century… The report by the Nelson A. Rockefeller Institute… underscores how swiftly the consumer slowdown has eaten into municipal budgets… State and local sales taxes, among the largest sources of revenue for municipalities, fell 6.1% in the fourth quarter of last year… Revenue from personal income taxes was down 1.1% in the fourth quarter; corporate income taxes dropped 15.5%, reflecting weaker profits.”

April 14 – Bloomberg (Michael McDonald): “U.S. states’ sales tax collection dropped the most in 50 years in the final three months of 2008, a result of the worst economic recession in a generation, according to the Rockefeller Institute of Government. Sales tax collections fell 6.1% in the fourth quarter compared with the same period the year prior… The institute’s survey of the 50 states also found that overall state tax collections, including income tax, fell 4% in the fourth quarter last year.”

April 16 – Bloomberg (Darrell Preston and Michael McDonald): “Houston’s deputy controller, James Moncur, figured last May the fourth-largest U.S. city escaped the unraveling credit markets by refinancing some of its $1.8 billion of auction-rate bonds. Instead, Houston wound up paying 15% interest on the new securities… The so-called variable-rate demand notes backfired when investors fled the market in October…The $479 billion market for the securities, whose rates are typically reset by banks every day or week, is turning into a quagmire for local officials who embraced a financing strategy they didn’t fully understand.”

April 15 – Bloomberg (Stacie Servetah): “The funding deficit of New Jersey’s public pension system climbed to $34.4 billion as of June 30, from $28.4 billion in mid-2007. The pensions were 72.6% funded as of June 30.”(snip)

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stand by for more state and local tax increases.