There are three general kinds of state balanced budget requirements:
The governor's proposed budget must be balanced (43 states and Puerto Rico).The budget the legislature passes must be balanced (39 states and Puerto Rico).The budget must be balanced at the end of a fiscal year or biennium, so that no deficit can be carried forward (37 states and Puerto Rico). Nature of state balanced-budget requirements All the states except Vermont have a legal requirement of a balanced budget. Some are constitutional, some are statutory, and some have been derived by judicial decision from constitutional provisions about state indebtedness that do not, on their face, call for a balanced budget. The General Accounting Office has commented that "some balanced budget requirements are based on interpretations of state constitutions and statutes rather than on an explicit statement that the state must have a balanced budget."
