SACRAMENTO — As Californians brace for big reductions in government services, the possibility of tax hikes and a long summer of budget bickering, they may be under the impression that everyone else is slogging through the same financial misery.
Not so.
Although the nation's sluggish economy and mortgage crisis have put the squeeze on a number of states, many are humming along fine, without dramatic measures to keep them in the black. Some even have multibillion-dollar surpluses. And almost none of the states that do have fiscal difficulties face shortfalls on the scale of California's.
Analysts say the state's troubles stem largely from its budget system -- the most dysfunctional in the country -- and they look to California as an example of how not to do things. In a recent ranking of state policies by the Pew Center on the States, California scored D+ on fiscal management. The average grade was B-.
"We have these problems that have long been understood, but we don't deal with them," said Jim Mayer, executive director of California Forward, a bipartisan think tank seeking to overhaul the budget process. "If we are going to fix this, we need to learn from what they have done in other places."
Of the 46 states that began their fiscal year on Tuesday, California is one of just four that still have no spending plan. Lawmakers are nowhere near agreement on how to patch a $15.2-billion shortfall, and the budget will probably include borrowing, accounting shifts and other maneuvers that make money managers cringe.
An outdated tax code, voter-approved initiatives that lock in billions of dollars for programs, inadequate oversight of spending and the lack of a substantial rainy-day fund all add to California's financial ills. Other states have addressed such issues with impressive results. But attempts at similar changes here routinely fall flat.
Virginia has achieved a balanced budget and a stellar credit rating by constantly updating its spending priorities, improving its tax system and setting funds aside to be tapped during hard economic times. The state is zealous about oversight, embedding independent investigators in state agencies to monitor how they are spending taxpayers' money.
Iowa, Maryland and Utah employ some of the same techniques, and there is momentum for such reforms in Ohio, Louisiana and Kentucky.
