State economic, demographic, and social trends are related to one another and, in turn, affect government policies on spending and taxation. A strong economy, for example, attracts more people to the state, which in turn boosts state tax collections. At the same time, however, increases in population also put additional pressure on such areas of state responsibility as public schools, prisons, and social services. Social developments, such as crime rates and the incidence of teenage pregnancies, also contribute to demands on public resources.

• Change in medical costs
• Income assistance (AFDC/TANF) caseload
• Juvenile rehabilitation institutional population

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What is inflation?

Inflation has been defined as a process of continuously rising prices, or equivalently, of a continuously falling value of money. In other words, inflation causes the buying power of a dollar to decrease over time. A 15 cent hamburger in 1966 seems to us a lot cheaper than the 79-cent hamburger of today. But when the price of that 1966 burger is adjusted for inflation, the price is comparable.