State balanced budget requirements vary widely, however.

• Forty-three states require their governors to submit a balanced budget to their legislatures.

• The legislature is required to pass a balanced budget in 39 states.

• Thirty-one won't allow the governor to sign a budget with a deficit.

• Some of these rules are written in constitutions and others as statutes; enforcement rules also differ.

Robert Inman of the Wharton School contends that the rules must be strict to be effective. He says they must:

• Be written into the constitution -- rather than just be laws -- and require a supermajority vote to override.

• Require budget balance at the end of each year -- with no carryover.

• Be enforced by a judiciary -- often an elected state supreme court -- that acts independently of those in charge of the budget.

While the federal amendment now under consideration contains all these things, state governments finance their activities differently than the federal government. States have both capital and operating budgets and it is only the latter which must be balanced. The federal government doesn't separate its budget into these categories.

Some experts say Washington would have to make these distinctions for the system to work, establishing a separate capital budget to allow long-term debt to finance long-term projects.

Also, states have used accounting tricks to circumvent the balancing requirement. But observers say they mostly follow the rules. Research shows that states reach balance through spending cuts, rather than raising taxes.

Source: Anna J. Bray, "States Do It -- Can the Feds?" Investor's Business Daily, February 19, 1997.

For more on Balancing the Federal Budget, see http://www.ncpa.org/pd/budget/budget.htm

State mandates eat up local funds and take away decision-making authority. State mandates tend to be smaller in magnitude than those issued by the federal government, but they are more numerous.

• In 1992, the Maryland Department of Fiscal Services identified 758 unfunded state mandates on local governments.

• In 1994, the State and Local Government Commission of Ohio found that one in 12 state laws passed in recent years imposed an unfunded mandate on local governments.

• In 1993, the South Carolina Advisory Commission on Intergovernmental Affairs found 700 spending mandates -- both funded and unfunded -- directed at local governments.

• A 1993 catalogue commissioned by the Virginia General Assembly identified 391 mandates -- 290 imposed by the state, 45 by Washington and the rest by both the state and the feds.

Experts say that states often "pass through" federal mandates to local governments -- particularly in the area of environmental programs.

Costs of following these rules can get expensive.

• A 1993 study involving Kansas found that just ten mandates absorbed almost half of all spending by the counties.

• Eleven state and 13 federal mandates imposed on the city of Savannah, Georgia, cost the city almost $2 million in 1993.

• In California, 80 percent of county spending goes to state-required programs.

Experts say federal mandates tend to push broad policy issues, while state-imposed mandates tend to give orders on how to provide social services.

Source: Charles Oliver, "Passing the Buck to Counties," Investor's Business Daily, February 14, 1997.