Breaking News: Ballotpedia partners with White House and Congressional leadership to sponsor Affordable Stare Act (ASA)

Pennsylvania state budget and finances

From Ballotpedia
Jump to: navigation, search

Pennsylvania budget and finances
Policypedia Budget Policy-logo-no background.png
General information
Budget calendar:
Annual
Fiscal year:
2015
State credit rating:
AA (as of 2014)
Current governor:
Tom Wolf
Financial figures
Total spending (state and federal funds):
$86.2 billion (estimated for 2014)
Per capita spending:
$6,741.19 (estimated for 2014)
Total state tax collections:
$34 billion (2013)
Per capita tax collections:
$2,657.45 (2013)
State debt:
$184.9 billion (as of 2014)
Per capita state debt:
$14,487 (as of 2014)
State budgets and finances
AlabamaAlaskaArizonaArkansasCaliforniaColoradoConnecticutDelawareFloridaGeorgiaHawaiiIdahoIllinoisIndianaIowaKansasKentuckyLouisianaMaineMarylandMassachusettsMichiganMinnesotaMississippiMissouriMontanaNebraskaNevadaNew HampshireNew JerseyNew MexicoNew YorkNorth CarolinaNorth DakotaOhioOklahomaOregonPennsylvaniaRhode IslandSouth CarolinaSouth DakotaTennesseeTexasUtahVermontVirginiaWashingtonWest VirginiaWisconsinWyoming

Horizontal-Policypedia logo-color.png
Total state expendituresState debtTax policy in Pennsylvania
Note: This page utilizes information from a variety of sources. As such, the currency of the information varies somewhat. The information presented on this page reflects the most recent data available as of February 2015.

Between fiscal years 2013 and 2014, total government spending in Pennsylvania increased by approximately $1.6 billion, from $84.6 billion in fiscal year 2013 to an estimated $86.2 billion in 2014. This represents a 1.9 percent increase. The cumulative rate of inflation during the same period was 1.58 percent, calculated using the Consumer Price Indices for January 2013 and January 2014. As of 2014, financial services firm Standard and Poor's had assigned Pennsylvania a credit rating of AA.[1][2][3]

In fiscal year 2014 Pennsylvania had the fourth-highest total spending in the nation at $86.2 billion.

Spending

Definitions

The information below comes from the National Association of State Budget Officers (NASBO). These spending figures are broken into three broad categories in order to facilitate comparison between the states.[3]

  • State funds: State funds include general and other state-based funds. A general fund is "the predominant fund for financing a state's operations." Other state funds are "restricted by law for particular governmental functions or activities."
  • Federal funds: Federal funds are "funds received directly from the federal government."
  • Total spending: Total spending is calculated by adding together the totals for state and federal funds.

These figures exclude spending from the sale of bonds.

2014 expenditures

See also: Total state expenditures

The table below breaks down estimated spending totals for fiscal year 2014 (comparable figures from surrounding states are included to provide additional context). Figures for all columns except "Population” and “Per capita spending" are rendered in millions of dollars (for example, $2,448 translates to $2,448,000,000). Figures in the columns labeled "Population” and “Per capita spending" have not been abbreviated.[3]

Pennsylvania's total estimated government spending in fiscal year 2014 was $86.2 billion, which was the second highest total when compared to surrounding states.

Total estimated state spending, FY 2014 ($ in millions)
State State funds Federal funds Total spending Population Per capita spending
Pennsylvania $62,391 $23,810 $86,201 12,787,209 $6,741.19
Delaware $7,253 $1,903 $9,156 935,614 $9,786.09
Maryland $27,479 $9,859 $37,338 5,976,407 $6,247.57
New Jersey $39,574 $13,566 $53,140 8,938,175 $5,945.29
New York $92,915 $41,171 $134,086 19,746,227 $6,790.46
Per capita figures are calculated by taking the state's total spending and dividing by the number of state residents according to United States Census estimates.[4]
Source: National Association of State Budget Officers

Spending by function

See also: State spending by function as a percent of total expenditures
Breakdown of spending by function in FY 2013.
Source: National Association of State Budget Officers

State spending in Pennsylvania can be further broken down by function (elementary and secondary education, public assistance, etc.). Fiscal year 2013 information is included in the table below (information from neighboring states is provided for additional context). Figures are rendered as percentages, indicating the share of the total budget spent per category.[3]

In fiscal year 2013, Medicaid accounted for 26.9 percent of Pennsylvania's total expenditures.

State spending by function as a percent of total expenditures, FY 2013
State K-12 education Higher education Public assistance Medicaid Corrections Trans-
portation
Other
Pennsylvania 14.9% 2.1% 1.5% 26.9% 2.6% 7.5% 44.6%
Delaware 24.3% 4.6% 0.3% 17.2% 3% 8.7% 42%
Maryland 19.2% 14.5% 3.8% 21% 4% 10% 27.5%
New Jersey 24.9% 7.9% 0.9% 20.4% 3.1% 10% 32.8%
New York 19.3% 7.6% 3% 29.1% 2.5% 6.4% 32.1%
Source: National Association of State Budget Officers
Note**: "Other" expenditures include "Children's Health Insurance Program (CHIP), institutional and community care for the mentally ill and developmentally disabled, public health programs, employer contributions to pensions and health benefits, economic development, environmental projects, state police, parks and recreation, housing and general aid to local governments."[3]

Spending trends

Between 2009 and 2013, the share of the Pennsylvania state budget spent on Medicaid decreased from 30.8 percent in 2009 to 26.9 percent in 2013. See the table below for further details (figures are rendered as percentages, indicating the share of the total budget spent per category).[3][5][6][7][8]

Spending by function from 2009 to 2013 (as percentages)
Year K-12 education Higher education Public assistance Medicaid Corrections Transportation Other
2013 14.9% 2.1% 1.5% 26.9% 2.6% 7.5% 44.6%
2012 18.4% 2.8% 1.9% 33.2% 3.5% 9.3% 30.8%
2011 19.5% 3.2% 2.1% 31.8% 3.2% 8.8% 31.4%
2010 19.8% 3.3% 2.2% 29.6% 3.4% 10.1% 31.6%
2009 19.7% 3.8% 2.2% 30.8% 3.3% 10.3% 29.9%
Source: National Association of State Budget Officers
Note**: "Other" expenditures include "Children's Health Insurance Program (CHIP), institutional and community care for the mentally ill and developmentally disabled, public health programs, employer contributions to pensions and health benefits, economic development, environmental projects, state police, parks and recreation, housing and general aid to local governments."[3]

Revenues

2013 revenues

See also: State government tax collections by source

The table below breaks down state government tax collections by source in 2013 (comparable figures from surrounding states are also provided to give additional context). Figures for all columns except "population" and "per capita revenue" are rendered in thousands of dollars (for example, $2,448 translates to $2,448,000). Figures in the columns labeled "population" and "per capita revenue" have not been abbreviated).[9]

Compared to neighboring states, Pennsylvania had the lowest state tax collections per capita in fiscal year 2013 at $2,657.45.

State tax collections by source ($ in thousands)
State Property taxes Sales and gross receipts Licenses Individual income taxes Corporation net income taxes Other taxes Total 2013 population Per capita collections
Pennsylvania $55,537 $17,106,300 $2,585,202 $10,777,334 $2,208,163 $1,233,090 $33,965,626 12,781,296 $2,657.45
Delaware N/A $487,202 $1,259,277 $1,130,501 $309,644 $159,692 $3,346,316 925,240 $3,616.70
Maryland $750,927 $7,347,048 $805,292 $7,693,324 $952,092 $569,508 $18,118,191 5,938,737 $3,050.85
New Jersey $4,620 $12,198,133 $1,516,432 $12,108,615 $2,282,055 $967,026 $29,076,881 8,911,502 $3,262.85
New York N/A $23,217,491 $1,952,367 $40,230,379 $4,920,605 $3,346,329 $73,667,171 19,695,680 $3,740.27
Source: Tax Policy Center, "State Tax Collection Sources 2000-2013," June 20, 2014
Pennsylvania tax collections by source in 2013.
Source: Tax Policy Center

The table below lists 2013 tax collections by source as percentages of total collections. About 50 percent of Pennsylvania's total state tax collections came from sales taxes and gross receipts.[9]

State tax collections by source (as percentages)
State Property taxes Sales and gross receipts Licenses Individual income taxes Corporation net income taxes Other taxes
Pennsylvania 0.16% 50.36% 7.61% 31.73% 6.50% 3.63%
Delaware N/A 14.56% 37.63% 33.78% 9.25% 4.77%
Maryland 4.14% 40.55% 4.44% 42.46% 5.25% 3.14%
New Jersey 0.02% 41.95% 5.22% 41.64% 7.85% 3.33%
New York N/A 31.52% 2.65% 54.61% 6.68% 4.54%
Source: Tax Policy Center, "State Tax Collection Sources 2000-2013," June 20, 2014

Current fiscal year budget

See also: Historic Pennsylvania budget and finance information

Fiscal year 2015

DocumentIcon.jpg See budget bill: HB 2328

Former Pennsylvania Governor Tom Corbett announced his fiscal year 2015 budget proposal on February 4, 2014. Under the governor's proposal, total general fund spending for fiscal year 2015 would have equaled approximately $29.4 billion.[10]

On July 10, 2014, Corbett signed into law the fiscal year 2015 budget. The enacted budget totaled $29 billion. The budget increased spending by $871 million over fiscal year 2014.[10]

State debt

See also: State debt

According to a January 2014 report by the nonprofit organization State Budget Solutions, Pennsylvania had a state debt of approximately $184.9 billion. Its state debt per capita was $14,487. The report revealed that state governments faced a combined $5.1 trillion in debt. The obligation amounted to $16,178 per capita in the nation.[11]

Total state debt, 2014
State Total state debt State debt per capita Per capita debt ranking
Pennsylvania $184,903,767,000 $14,487 24
Delaware $15,991,093,000 $17,437 17
Maryland $94,211,004,000 $16,010 20
New Jersey $213,933,875,000 $24,134 6
New York $387,465,667,000 $19,799 10
Sources: State Budget Solutions, "State Budget Solutions' Fourth Annual State Debt Report," January 8, 2014

Public pensions

See also: Pennsylvania public pensions and Pennsylvania public employee salaries

A 2012 report from the Pew Center on the States noted that Pennsylvania's pension system was funded at 75 percent at the close of fiscal year 2010, below the 80 precent funding level experts recommend. Consequently, Pew designated the state's pension system as cause for "serious concern."[12]

Taken together, the funding ratio for the state's pension systems decreased from 89.65 percent in fiscal year 2007 to 64.37 percent in fiscal year 2012, a decrease of 25.28 percentage points, or 28.2 percent. Likewise, unfunded liabilities increased from just under $10.3 billion in fiscal year 2007 to more than $47 billion in fiscal year 2012.[13][14][15]

Credit ratings

See also: State credit ratings

Credit rating agencies, such as Standard and Poor's, assign grades to states that take into account a state's ability to pay debts and the general health of the state's economy. Generally speaking, a higher credit rating indicates lower interest costs on the general obligation bonds states sometimes sell to investors in order to finance large-scale undertakings (e.g., road construction and other public works projects). This in turn results in lower interest costs, thereby lowering the cost to taxpayers.[16][17]

The table below lists the Standard and Poor's credit ratings for Pennsylvania and surrounding states from 2004 to 2014. Standard and Poor's grades range from AAA, the highest available, to BBB, the lowest.[18]

State credit ratings, 2004 to 2014
State 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004
Pennsylvania AA AA AA AA AA AA AA AA AA AA AA
Delaware AAA AAA AAA AAA AAA AAA AAA AAA AAA AAA AAA
Maryland AAA AAA AAA AAA AAA AAA AAA AAA AAA AAA AAA
New Jersey A+ AA- AA- AA- AA AA AA AA AA AA AA-
New York AA AA AA AA AA AA AA AA AA AA AA
Source: Stateline: The Daily News Service of The Pew Charitable Trusts, "Infographic: S&P State Credit Ratings, 2001-2014," June 9, 2014.

Federal aid to state budget

See also: Federal aid to state budgets

State governments receive aid from the federal government to fund a variety of joint programs, such as Medicaid. Federal aid varies considerably from state to state. For example, Mississippi received approximately $7.7 billion in federal aid in 2012, which accounted for more than 45 percent of the state's general revenues. By contrast, Alaska received roughly $2.9 billion in federal aid in 2012, just under 20 percent of the state's general revenues.[19]

The table below notes what share of Pennsylvania’s general revenues came from the federal government in 2012. That year, Pennsylvania received approximately $20.4 billion in federal aid, 30.6 percent of the state's total general revenues. Figures from surrounding states are provided for additional context.[19]

Federal aid to state budgets, 2012
State Total federal aid ($ in thousands) Federal aid as a % of general revenue Ranking
Pennsylvania $20,440,103 30.60% 32
Delaware $1,814,112 24.68% 46
Maryland $10,030,264 30.16% 33
New Jersey $13,412,759 26.25% 42
New York $48,698,785 32.78% 27
Source: United States Census Bureau, "State Government Finances: 2012," accessed February 24, 2014

Stimulus

Pennsylvania received $8.47 billion in federal stimulus funding between February 2009 and June 2013.[20]

Budget process

The state operates on an annual budget cycle. The sequence of key events in the budget process is as follows:[21][22]

  1. Budget instruction guidelines are sent to state agencies in August of the year preceding the start of the new fiscal year.
  2. State agencies submit their requests to the governor in October.
  3. Agency hearings are held in December and January. Public hearings are held in February and March.
  4. The governor submits his or her proposed budget to the state legislature in February.
  5. The legislature typically adopts a budget in May or June. A simple majority is required to pass a budget. The fiscal year begins July 1.

Pennsylvania is one of 44 states in which the governor has line item veto authority.[22]

The governor is legally required to submit a balanced budget proposal. While the legislature is not legally required to pass a balanced budget, the Governor is legally required to sign a balanced budget.[22]

Agencies, offices and committees

The following standing committees in the Pennsylvania State Legislature deal with budget and finance matters:

  1. Appropriations Committee, Pennsylvania House of Representatives
  2. Appropriations Committee, Pennsylvania State Senate
  3. Finance Committee, Pennsylvania House of Representatives
  4. Finance Committee, Pennsylvania State Senate
  5. Legislative Budget and Finance Committee, Pennsylvania General Assembly

The Pennsylvania Auditor General has been the state's fiscal watchdog since 1809, when the position was created by an act of the General Assembly. The auditor general was appointed by the governor until 1850, when the position became an elected office. State and local audits reports are published online.[23]

Studies and reports

U.S. PIRG "Following the Money" report

See also: "Following the Money" report, 2014

The U.S. Public Interest Research Group, a consumer-focused nonprofit organization based in Washington, D.C., released its annual report on state transparency websites in April 2014. The report, entitled "Following the Money," measured how transparent and accountable state websites are with regard to state government spending.[24] According to the report, Pennsylvania received a grade of B- and a numerical score of 82.5, indicating that Pennsylvania was an "advancing" state in terms of transparency regarding state spending.[24]

Contact information

Pennsylvania Office of Budget
303 Walnut Street - Verizon Tower, 7th Floor
Harrisburg, Pennsylvania 17101
Telephone: 717-787-2542

Budget and finance ballot measures

Voting on
state and local
government budgets,
spending and finance
State finance.jpg
Policy
Budget policy
Ballot measures
By state
By year
Not on ballot
See also: State and local government budgets, spending and finance on the ballot and List of Pennsylvania ballot measures

Ballotpedia has tracked no ballot measures relating to state and local budget and finance matters in Pennsylvania

Recent news

This section displays the most recent stories in a Google news search for the terms "Pennsylvania budget."

All stories may not be relevant to this page due to the nature of Google's news search engine.

Pennsylvania state budget and finances - Google News Feed

  • Loading...

See also

External links

Additional reading

References

  1. Bureau of Labor Statistics, "CPI Detailed Report Data for February 2014," accessed April 9, 2014
  2. InflationData.com, "Cumulative Inflation Calculator," February 28, 2014
  3. 3.0 3.1 3.2 3.3 3.4 3.5 3.6 National Association of State Budget Officers, "State Expenditure Report: 2012-2014," accessed February 18, 2015
  4. United States Census Bureau, "State and County QuickFacts," accessed February 23, 2014
  5. National Association of State Budget Officers, "State Expenditure Report, 2009-2011," accessed February 24, 2014
  6. National Association of State Budget Officers, "State Expenditures Report, 2010-2012," accessed February 24, 2014
  7. National Association of State Budget Officers, "State Expenditure Report, 2009," accessed February 24, 2014
  8. National Association of State Budget Officers, "State Expenditure Report, 2008," accessed February 24, 2014
  9. 9.0 9.1 Tax Policy Center, "State Tax Collection Sources 2000-2013," June 20, 2014
  10. 10.0 10.1 National Association of State Budget Officers, "Summaries of Fiscal Year 2015 Proposed and Enacted Budgets," July 11, 2014
  11. State Budget Solutions, "State Budget Solutions' Fourth Annual State Debt Report," January 8, 2014
  12. Pew Center on the States, "Widening Gap Update: Pennsylvania," June 18, 2012
  13. State Employees' Retirement System, "2012 Comprehensive Annual Financial Report," accessed November 19, 2013
  14. Public School Employees' Retirement System, "2012 Actuarial Valuation Report," accessed November 19, 2013
  15. Municipal Retirement System, "2012 Comprehensive Annual Financial Report," accessed November 19, 2013
  16. Stateline: The Daily News Service of The Pew Charitable Trusts, "Infographic: S&P State Credit Ratings, 2001-2012," July 13, 2012
  17. Bankrate, "The 6 states with the worst credit ratings," September 27, 2012
  18. Stateline: The Daily News Service of The Pew Charitable Trusts, "Infographic: S&P State Credit Ratings, 2001-2014," June 9, 2014
  19. 19.0 19.1 United States Census Bureau, "State Government Finances: 2012," accessed February 24, 2014
  20. Recovery.gov, "Stimulus Spending by State," accessed February 21, 2014
  21. National Conference of State Legislatures, "State Experiences with Annual and Biennial Budgeting," updated April 2011
  22. 22.0 22.1 22.2 National Association of State Budget Officers, "Budget Processes in the States, Summer 2008," accessed February 21, 2014
  23. Pennsylvania Auditor General, "State and Local Audit Reports," accessed May 1, 2014
  24. 24.0 24.1 U.S. Public Interest Research Group, "Following the Money 2014 Report," accessed April 15, 2014