This fiscal outlook for states is grim, with 18 already facing billions of dollars in budget shortfalls and virtually all of them having to cope with an economic stimulus package that is likely to hit them with further revenue losses totaling nearly $2 billion, Arizona Gov. Janet Napolitano told the Senate Finance Committee yesterday.

During a committee hearing on the economic and fiscal conditions of the states that lasted about 20 minutes before being cut short so committee members could leave to vote, Napolitano said that as the economy slows, between 35 and 40 states will face "severe" budget cuts in 2009.

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