PAYGO: Improving State Budget Discipline While Retaining Flexibility: States can help policymakers and the public understand the consequences of budget decisions and properly weigh the long-term impact of alternative proposals by adopting important budget management tools that also promote fiscal responsibility. The cornerstone of these tools is "pay-as-you-go" (PAYGO), a requirement that the governor and the legislature fully offset over a 5-year period the cost of proposed and enacted increases in spending or reductions in revenues through …
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