Volcker Alliance
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Promoting Truth and Integrity in State Budgeting

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The Truth and Integrity in Government Finance Initiative aims to improve state and local budgeting, financial reporting, and fiscal practices.
Truth and Integrity in Government Finance Initiative
Photos from the FY2020 State Fiscal Conference, from left to right: 1) Kaye Husbands Fealing, panelist. 2) William Glasgall, Volcker Alliance senior vice president and director of state and local initiatives. 3) Shirley Clarke Franklin, keynote speaker and former Atlanta mayor. 4)  The conference convened state legislators, budget officials, investors, Fed officials, media, and others discuss strategies for meeting critical budgetary challenges. 5) Raphael Bostic, keynote speaker and Federal Reserve Bank of Atlanta president.

The Alliance’s longitudinal study of state budgeting practices, conducted in cooperation with public finance experts at eight US public universities, showed strong results in 2019. The impact of the initiative has been seen in national media coverage and improved legislative practices. In December 2019, both houses of the New Jersey legislature passed a measure establishing a consensus revenue estimating process adhering to the Volcker Alliance’s best practice recommendations. The passage of the New Jersey bill follows budgetary reforms and proposals in several states, including Illinois, Pennsylvania, Utah, and Vermont, that are based on principles advanced by the Alliance.

Expanding on findings from the 2018 report Truth and Integrity in State Budgeting: Preventing the Next Fiscal Crisis, the Volcker Alliance released fifty report cards outlining each state budget’s strengths and weaknesses, covering fiscal 2016 through 2018. Building on the grades, conclusions, and best practice recommendations contained in the Truth and Integrity reports and State Budget Report Cards, the Alliance and the Federal Reserve Bank of Atlanta hosted the FY2020 State Fiscal Conference, “Truth and Integrity in State Budgeting: Looming Risks, Durable Solutions,” in Atlanta. The conference marked the release of a working paper titled Rainy Day Fund Strategies: A Call to Action, in which the Volcker Alliance examined the rainy day fund policies and practices of all fifty states and set out a ten-point program for states to use as a template for reform. At the event, the Alliance produced a four-part podcast series on best practices in state budgeting. The Alliance’s budgetary data and findings were also presented to major credit-rating agencies, municipal investors, and conferences of state and local government officials, and academics produced at least eighteen research papers based largely on the Alliance’s budget work.

The Volcker Alliance brought attention to a specific budgetary practice in a working paper titled America’s Trillion-Dollar Repair Bill: Capital Budgeting and the Disclosure of State Infrastructure Needs. The paper reported that states and local governments do not fully disclose the costs of infrastructure maintenance that is necessary to address America’s critical need to rebuild crumbling public assets. The Alliance offered a ten-point action plan that states should follow to promote transparency and help set agendas for reform.

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