There are many summer sounds to be heard on June nights but this year one of those sounds are the gnashing of teeth in state capitols throughout the U.S.

In a May report, the non-profit Rockefeller Institute summarized early state reporting of income tax for the first quarter. After adjusting for inflation, state income tax revenues declined an average of 14% compared to the first quarter of 2008. South Carolina’s drop was precipitous – over a third. The average decline in sales tax revenue was 7.6% but Georgia saw a drop of over 16%.

Many states start their fiscal year in July and must base their budgets on preliminary data. Personal income tax makes up an average of 40% of state revenues for the 41 states which have personal income tax. The Rockefeller Institute projected an even steeper decline in revenues in April revenues. Since most states must balance their budgets, there will continue to be hotly contested adjustments to state spending to meet the reduced revenue streams.