DURHAM — North Carolina's budget deficit is having a ripple effect across the state.

Durham County is facing a $3.2 million shortfall. Governor Mike Easley decided to withhold state tax reimbursements because of the budget crisis.

As a result, Durham announced a hiring freeze for any vacant positions, and all temporary workers will be terminated by the end of the week.

"The shortfall for us is really substantial, given our rank and size in the state. In fact, I think of the 100 counties I looked at, I believe we had the fifth highest shortfall that was created by the governor's actions," says Durham County manager Mike Ruffin.

Ruffin says the budget shortfall left him with few options since state law requires local governments to maintain a balanced budget.