Fiscally speaking, a very good year.

• Position: State economies for FY ended June 30, 1995

FY 1995 (the fiscal year that ended June 30 for most states) was the best in recent memory for state finances. But good news could be replaced with problems if federal program and funding changes go into effect in late 1995 or early 1996. Current federal budget proposals could force very difficult budget and policy issues onto legislative calendars. But for now, bask in the good news. States ended FY 1995 in better shape than they have enjoyed for 15 years.

That's based on the way state fiscal wonks and bond houses look at state finances - the bottom line. End of year balances were 5.9 percent of expenditures, the highest level they have reached since the record was set in 1980. This figure excludes the $1.7 billion held by Alaska, as well as money some states have tucked away in case they need to make up for possible cuts in federal grants in aid in the course of FY 1996.

Measured the way taxpayers look at things, it was also a good year - good enough that what taxpayers will owe in the course of FY 1996 will be about $2.5 billion less than what they would have owed otherwise. That figure counts only now are coming into effect. The biggest cuts were in personal and corporate income taxes. Aside from extensions of health...