Rainy Day Fund

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Rainy Day Fund

1. In the United States, savings put aside by individual states to pay for services when revenues fall below expenditures. That is, when the state is required to spend money in excess of its tax and other revenue, it may use the rainy day fund to make up the difference. States put a certain percentage of their budget surpluses into their rainy day funds. Rainy day funds are especially important for states that have balanced budget amendments in place.

2. More broadly, any savings especially set aside for a specific purpose.
References in periodicals archive ?
Why States Save: Using Evidence to Inform How Large Rainy Day Funds Should Growexamines budget stabilization funds-often called rainy day funds-and offers recommendations to determine optimal savings goals and create enhanced budgetary flexibility over the course of the ups and downs of economic activity.
MOSCOW, Muharram 14, 1437, Oct 27, 2015, SPA -- Russia says it will likely deplete one of its two rainy day funds by the end of next year as it tries to plug the state deficit amid the economic downturn, AP reported.
Rainy day funds are one of the most common tools states have to soften the blow of economic downturns and budget shortfalls.
2012 rainy day funds Arkansas United States Have funds 37% 40% No funds 58% 56% Arkansas vs.
It may take several attempts over a few sessions to get it exactly right, but we're hoping that we at least get the mechanism and some Rainy Day funds available for it.
When rainy day funds work, it is the strength of their withdrawal rules that matter.
In a 2005 policy brief titled "A Primer on State Rainy Day Funds," the Institute on Taxation and Economic Policy in Washington, D.
Many states have bailed themselves out by using money that accumulated in their rainy day funds when the economy was thriving.
The rainy day funds cannot be spent without legislative appropriation.
Many states used the unexpected excess to supplement appropriations or fortify their rainy day funds.
Lawmakers are still more likely to use debt-financing (bonds) or rainy day funds (one-time infusions) than they are to vote for taxes or for fees that can be called taxes by future opponents.
Jennifer Granholm has suggested the state may want to set up multiple rainy day funds, including a new rainy day fund for schools, instead of adding the money to the current Budget Stabilization Fund.