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Federal outlays to state government (2000-2019)
 Documenting America's Path to Recovery: State budget policy |
All states receive revenue from the federal government, usually in the form of grants. These outlays comprise a significant share of state budgets. Between fiscal years 2000 and 2019, the average proportion of federal funds in state budgets was 31.0%. The federal share of state budgets stood at or below the 30% mark in years 2000-2002 and 2005-2008 (interrupted by the effects of the recession in the early 2000s), and then climbed after the Great Recession to 35.5% in 2010 due to federal economic stimulus dollars and falling state tax revenues. After 2010, the federal share of state budgets has remained above 30% every year, reaching a high-point in FY 2020 related to reduced state tax revenues and increased federal aid during the coronavirus pandemic.[1]
What are federal outlays to state governments?
Federal outlays are revenue that state governments receive directly from the federal government. Outlays are different from budget authority, which is the total amount allowed for spending.[2]
Federal grants to states support a wide range of programs and services: health care, public education, housing, community development, child care, job training, transportation, public safety, and others.
The three primary sources of revenue to the federal government are individual income taxes, corporate income taxes, and payroll taxes. The largest source of federal revenue is individual income taxes, which supplied roughly 50.5% of total federal revenue in fiscal year 2021. Corporate income tax generated 9.2% of federal tax revenues in 2021, 32.5% came from payroll taxes, and 1.9% came from excise taxes (gasoline, tobacco, alcohol, airline travel).[3]
Federal outlays to states, fiscal years 2000-2019
In FY 2019, federal outlays to the states ranged from a high of $100.01 billion (California) down to $1.49 billion (South Dakota).[4]
The ten states with the greatest totals in federal outlays in 2019:
| States with the greatest totals in federal outlays in 2019 | |
|---|---|
| State | Federal outlay total |
| California | $100.01 billion |
| New York | $65.78 billion |
| Texas | $46.15 billion |
| Pennsylvania | $31.23 billion |
| Florida | $28.96 billion |
| Ohio | $24.58 billion |
| Michigan | $22.54 billion |
| Illinois | $20.56 billion |
| North Carolina | $19.43 billion |
| New Jersey | $17.79 billion |
The ten states with the lowest totals in federal outlays in 2019:
| States with the lowest totals in federal outlays in 2019 | |
|---|---|
| State | Federal outlay total |
| South Dakota | $1.49 billion |
| North Dakota | $1.74 billion |
| Vermont | $2.01 billion |
| Wyoming | $2.28 billion |
| New Hampshire | $2.40 billion |
| Delaware | $2.52 billion |
| Rhode Island | $2.83 billion |
| Hawaii | $2.88 billion |
| Idaho | $3.08 billion |
| Maine | $3.08 billion |
The primary information source of federal outlays to the states is the US Census Bureau's State & Local Government Finance Historical Datasets & Tables.
Trends in per capita federal outlays to states
The average federal outlays to states between 2000 and 2019 was $1,557. Since 2000, the per capita figure has increased every year with two exceptions: FY 2012 (a $223 decrease from FY 2011), and FY 2013 (a $1 decrease from FY 2012). The average increase per capita year-over-year between 2000 and 2019 was $74.
See also
- State debt per capita (2000-2018)
- Proportion of state government general revenues from the federal government (2000-2020)
- State and local contributions to public pension funds, 2000-2019
- State unfunded public pension liabilities, 2003-2018
External links
- U.S. Government Accountability Office, "Federal Grants to State and Local Governments"
- Economic Policy Institute, "Budget, Taxes and Public Investment"
- Center on Budget and Policy Priorities, "Policy Basics: Introduction to the Federal Budget Process"
- Center on Budget and Policy Priorities, "Federal Aid to State and Local Governments"
Footnotes
- ↑ Pew Charitable Trusts, "Where States Get Their Money," July 24, 2019
- ↑ Center on Budget and Policy Priorities, "Policy Basics: Introduction to the Federal Budget Process," April 2, 2020
- ↑ Tax Policy Center, "Percentage of Revenue by Source," accessed May 25, 2022
- ↑ U.S. Census Bureau, "State & Local Government Finance Historical Datasets & Tables," accessed May 25, 2022
