State Fiscal Relief Act of 2008

State Fiscal Relief Act of 2008 - Provides that, if the federal medical assistance percentage (FMAP) determined without regard to this Act under title XIX (Medicaid) of the Social Security Act for a state for FY2008 is less than the FMAP as so determined for FY2007, the FY2007 FMAP shall be substituted for the state's otherwise applicable FMAP for the second, third, and fourth calendar quarters of FY2008.

Provides also that, if the FMAP determined without regard to this Act for a state for FY2009 is less than the FMAP as so determined for FY2008, the FY2008 FMAP shall be substituted for the state's otherwise applicable FMAP for the first and second calendar quarters of FY2009.

Provides that, for each eligible state for the second, third, and, fourth calendar quarters of FY2008, and for the first and second calendar quarters of FY2009, the FMAP shall be increased by 1.225% points.

Provides for an increase in cap on Medicaid payments to territories.

Makes a state eligible for such an FMAP increase, and a territory for an increase in a cap amount, only if eligibility under its Medicaid plan is no more restrictive than the eligibility under such plan (or waiver) as in effect on December 31, 2007.

Authorizes appropriations for FY2008-FY2009 for payments to states (temporary state fiscal relief) for use in: (1) providing government services; (2) covering the costs of complying with any federal intergovernmental mandate to the extent that the federal government has not provided funds to cover such costs; or (3) compensating for a decline in federal funding to the state.