The fiscal condition of U.S. states continues to improve as revenue and spending rise, but the gains are modest, and many states are still not back to their pre-recession financial levels, says a new report from the National Governors Association (NGA) and the National Association of State Budget Officers (NASBO).

The latest NGA-NASBO biannual "Fiscal Survey of States," released on Dec. 14, says that states’ total general-fund revenue for fiscal year 2013 is expected to rise 3.9%, to $692.8 billion, finally bringing income above the pre-recession 2008 mark. For most states, fiscal 2013 will end next June 30.