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State Government Revenue Drops by 30 Percent

January 6, 2011 · Print · Email

Between 2008 and 2009, total state government revenue dropped by more than 30 percent, according to recently released U.S. Census Bureau figures.  Total state government fell to $1.1 trillion in 2009, down from $1.6 trillion in 2008. The sharp decline in social insurance trust revenue - which includes public employee retirement, unemployment compensation, workers compensation, and other insurance trusts (like Social Security, Medicare, etc.) - is cited as the main reason for the significant decrease in overall state government revenue.

The drop in general (versus total) revenues paints a less bleak picture, dropping just 1.4 percent in 2009 from the year prior.  General revenue excludes utility, liquor store, and insurance trust revenue.

Expenditures by state governments rose by 3.0 percent in 2009.  Education, public welfare, and health and hospitals represented the areas in which states spent the highest percentage of general expenditures.  Specifically:

  • Georgia spent the greatest percentage (46.1) of general expenditures on education. Fourteen other states also spent more than 40 percent of general expenditures on education.
  • Minnesota spent the greatest percentage (37.5) of general expenditures on public welfare. Ten other states also spent more than 30 percent of general expenditures on public welfare.
  • Hawaii spent the greatest percentage (12.3) of general expenditures on public health and hospitals.
  • Alaska spent the greatest percentage (13.5) of general expenditures on highways.

The 2009 Annual Survey of State Government Finances contains detailed data on revenues, expenditures, debt, and cash and security holdings for each state, by category.  “The annual survey began in 1951, and every year since has provided state governments with a complete look at their fiscal condition and how their financial activities stack up against other states,” said Lisa Blumerman, chief of the Census Bureau’s Governments Division, in a press release announcing the release of this year’s report.  Click on this link to download a summary of the report, or the complete data file.

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