FY 2014 Per Capita Federal Spending on Major Grant Programs Curtis Smith, Nick Jacobs, and Trinity Tomsic

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1 Special Analysis 15-03, June 18, 2015 FY 2014 Per Capita Federal Spending on Major Grant Programs Curtis Smith, Nick Jacobs, and Trinity Tomsic Summary Per capita federal spending is one measure for states to assess how they fare in their fiscal relationship with the federal government. This analysis provides the most recent per capita figures, focusing on the 244 federal grant-in-aid programs tracked and included in FFIS s Grants Database. These grants account for more than 90% of total federal grants to state and local governments. The database primarily includes formula grants and does not capture many of the small competitive grants for which states compete. This analysis provides per capita data for federal fiscal year (FY) 2014, using the Census Bureau s annual population estimates from July On average, the federal government spent $1,969 per person on grants to state and local governments, ranging from $4,994 in the District of Columbia to $1,265 in New Hampshire. Per Capita Analysis A number of factors explain how states fare in federal grants. Medicaid alone accounts for about half of all state and local grant funding. Given its sheer size, it is the most important determinant of how much federal funds most states receive. States with a large federal presence also tend to rank high, as they receive significant federal funds based on the value of the natural resources extracted from their public lands. A state s demographics and the well-being of its population also play a large role since many federal grant allocations are determined by related formula factors. For example, states with a large share of low-income children tend to receive more education dollars. As expected, highly populated states receive the most federal grant dollars because many formulas rely in part on population. States with relatively small populations tend to do well on a per capita basis because several grant formulas include small-state minimums. States with significant natural resources generally have fewer people. To further explain state rankings and the nuances among states, this analysis takes a detailed look at federal grants by major category and budget function. Very few states perform well across-the-board. Most rank high in some areas and low in others. FFIS Special Analysis 15-03

2 Total Funding. Table 1 provides total funding by state for the grants in the FFIS database between FYs Overall, federal spending grew by $112 billion (21.4%) over this period, driven in large part by a $90 billion (40.9%) increase in Medicaid. Nevada (51.8%), Oregon (50.2%), and Hawaii (49.3%) experienced the largest increases. New Hampshire (0.7%) and Wyoming (0.2%) saw the smallest increases, while Maine (-2.7%) saw a reduction in federal grant dollars, largely attributable to Medicaid. As expected, most states rankings for total funding align closely with overall population rankings. States Receiving Most/Least Federal Grants, FY 2014 Rank Top 10 Population Rank Rank Bottom 10 Population Rank 1 California 1 52 North Dakota 48 2 New York 4 51 South Dakota 47 3 Texas 2 50 New Hampshire 43 4 Florida 3 49 Vermont 51 5 Pennsylvania 6 48 Delaware 46 6 Ohio 7 47 Montana 45 7 Illinois 5 46 Wyoming 52 8 Michigan Alaska 49 9 North Carolina 9 44 Nebraska Georgia 8 43 Rhode Island 44 Per Capita Federal Spending. Table 2 compares per capita spending in FY 2009 and FY In FY 2014, overall per capita spending was $1,969, an increase of 17% compared to FY The following states saw the largest growth in per capita federal grants: Oregon (44.1%), Nevada (43.6%), and Hawaii (41.6%). Nevada is the only one of these states to rank in the top 10 for population growth during the same period. Wyoming (-4.0%), South Dakota (-3.6%), Maine (-2.8%), Louisiana (-1.5%), and New Hampshire (-0.1%) saw reductions in per capita spending during this period. Alaska, Louisiana, Maine, Montana, New Hampshire, North Dakota, South Carolina, South Dakota, Utah, and Wyoming experienced population growth that outpaced increases in federal grants. The least-populated states tend to rank the highest in per capita federal spending. New York is an exception, with Medicaid driving the results. Per Capita Federal Spending, FY 2014 Rank Top 10 Population Rank Rank Bottom 10 Population Rank 1 District of Columbia New Hampshire 43 2 Wyoming Virginia 12 3 Alaska Nevada 36 4 New Mexico Utah 34 5 New York 4 48 Kansas 35 6 Vermont Colorado 22 7 Rhode Island Nebraska 38 8 West Virginia Florida 3 9 Mississippi Maryland Oregon Georgia 8 FFIS Special Analysis Page 2

3 Per Capita Federal Spending by Type of Grant. Table 3 provides FY 2014 per capita federal spending by type of grant. These types include Medicaid, other state grants, grants to local governments, and grants that flow to individuals/others (such as Pell Grants and Supplemental Nutrition Assistance Program [SNAP] benefits). The results for states ranking in the top and bottom 10 are summarized below. Per Capita Federal Spending by Type of Grant Rank Medicaid Other State Local Indiv./Other Top 10 1 District of Columbia Wyoming District of Columbia District of Columbia 2 New York Alaska Alaska Arizona 3 New Mexico Puerto Rico Hawaii Hawaii 4 Vermont District of Columbia Puerto Rico Mississippi 5 Rhode Island North Dakota New York New Mexico 6 West Virginia Montana New Jersey Oregon 7 Oregon New Mexico New Mexico Tennessee 8 Arkansas Vermont Massachusetts West Virginia 9 Kentucky South Dakota Montana Alabama 10 Mississippi West Virginia Tennessee Georgia Bottom Puerto Rico Virginia Iowa Wyoming 51 Virginia Florida New Hampshire North Dakota 50 New Hampshire Colorado Wisconsin New Hampshire 49 Utah Maryland Indiana Nebraska 48 Wyoming Nevada South Carolina New Jersey 47 South Dakota Washington Idaho Kansas 46 Nevada New Hampshire Vermont Minnesota 45 Nebraska Arizona Arkansas Nevada 44 Kansas Minnesota Nebraska Colorado 43 Florida North Carolina Florida Virginia The District of Columbia and New Mexico are the only jurisdictions to receive a top-10 ranking in all categories. At the other end, New Hampshire ranks in the bottom 10 for all categories while Florida, Nebraska, Nevada, and Virginia rank in the bottom for three. Medicaid accounts for 48.7% of total funding per capita (in comparison, other state grants and local grants together account for 35.1%). In fact, the performance of many of the top-ranking states shown on Tables 1 and 2 can be explained by the amount of federal funding they receive for Medicaid. Some jurisdictions such as the District of Columbia, Mississippi, New Mexico, and West Virginia have a high federal Medicaid matching rate, which is calculated based on a state s relative per capita personal income (the District of Columbia s is set at 70% as part of the city s federal financing structure). Other states, most notably New York, receive a lower federal matching rate, but run a robust and/or expensive Medicaid program, which drives up federal reimbursements. Per Capita Federal Spending by Function. Table 4 provides FY 2014 per capita federal spending by federal budget function. Sorting spending by function yields a number of interesting results: Health, social services, and income security programs represent 78% of per capita spending on selected grant programs. Puerto Rico is the only jurisdiction to receive less than $500 per person for health programs. FFIS Special Analysis Page 3

4 Wyoming s large federal revenue from mineral leasing (shown in general government) offsets its bottom ranks in health, and social services and income security. Per capita federal spending on transportation ranges from $70 in Puerto Rico to $993 in Alaska. The District of Columbia receives more than three times the national average for justice programs while North Dakota receives more than five times the average for agriculture programs. Alaska, the District of Columbia, and Puerto Rico are the only jurisdictions to receive more than $400 per person for education. Alaska, the District of Columbia, Rhode Island, Vermont, and West Virginia rank above average in most areas. Maryland and Florida rank below average in every function. The table below highlights the states ranking in the top and bottom five for the various budget functions. Rank Health Income Security- Social Services Education Transportation 1 District of Columbia District of Columbia Puerto Rico Alaska Wyoming 2 New York Puerto Rico Alaska Wyoming Alaska 3 New Mexico New York District of Columbia District of Columbia Montana Energy, Environment, and Natural Resources 4 Vermont Hawaii Arizona Montana West Virginia 5 Rhode Island Mississippi South Dakota North Dakota Tennessee 52 Puerto Rico New Hampshire Nevada Puerto Rico Florida 51 Virginia Utah Washington Florida California 50 New Hampshire Wyoming Maryland Michigan Texas 49 Utah Colorado New Jersey Arizona Georgia 48 Wyoming Virginia Virginia North Carolina Arizona Rank Employment and Training Per Capita Federal Spending by Budget Function, FY 2014 Community-Regional Development Top Five Bottom Five General Government Justice Agriculture Top Five 1 Alaska District of Columbia Wyoming District of Columbia North Dakota 2 Wyoming Rhode Island New Mexico Alaska South Dakota 3 District of Columbia Vermont Puerto Rico Delaware Wyoming 4 Puerto Rico Puerto Rico North Dakota Wyoming Vermont 5 North Dakota Maine Utah Vermont Montana Bottom Five 52 Utah Florida Rhode Island Virginia New Jersey 51 Hawaii Colorado New York Kentucky California 50 Iowa Virginia Connecticut Ohio Florida 49 Virginia Arizona New Jersey Minnesota Arizona 48 Oklahoma Oklahoma Maryland Pennsylvania New York Full Database. An electronic Excel spreadsheet that accompanies this brief includes the detail behind the analysis. Specifically, it provides the same information as the summary tables, but for every program in the FFIS Grants Database. In addition, it contains key program information such as the federal agency that administers the grant, type of funding, CFDA number, budget function, and authorizing legislation to allow the user to manipulate the data. (This spreadsheet is made available only to full subscribers with access to the FFIS Grants Database.) FFIS Special Analysis Page 4

5 Table 1 Total Federal Spending on Selected Grants (dollars in thousands) FYs State FY 2009 FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 Rank % Change Rank Alabama $8,193,593 $8,694,055 $9,194,175 $9,319,908 $9,186,617 $9,125, % 39 Alaska 2,479,260 2,617,540 2,605,261 2,718,325 2,668,369 2,679, % 44 Arizona 12,481,515 14,099,557 13,897,745 13,180,767 13,053,046 14,108, % 35 Arkansas 5,786,465 6,303,384 6,287,519 6,398,434 6,318,032 7,041, % 19 California 58,711,955 63,387,399 70,080,223 65,705,494 76,648,514 81,104, % 5 Colorado 5,866,246 6,441,520 6,856,427 6,847,608 7,027,576 8,003, % 6 Connecticut 6,049,939 6,123,086 6,415,893 6,440,303 6,844,981 7,739, % 9 Delaware 1,478,594 1,626,191 1,793,332 1,818,206 1,954,859 2,096, % 4 District of Columbia 2,598,125 2,844,939 3,029,496 2,974,633 3,113,175 3,290, % 11 Florida 23,306,968 27,388,407 28,748,054 28,823,998 29,617,539 30,493, % 8 Georgia 14,590,163 15,892,289 16,195,177 16,222,754 16,378,764 16,853, % 30 Hawaii 2,046,165 2,269,073 2,435,508 2,636,205 2,799,060 3,054, % 3 Idaho 2,462,271 2,684,881 2,855,836 2,909,342 2,966,890 2,948, % 22 Illinois 19,636,191 21,886,050 21,196,746 20,685,534 21,845,808 22,289, % 34 Indiana 9,884,780 10,234,946 11,465,698 11,417,501 11,921,667 12,483, % 12 Iowa 4,803,824 5,450,957 5,621,694 5,592,715 5,539,834 5,509, % 32 Kansas 3,840,105 4,047,492 4,204,461 4,181,686 4,019,615 4,225, % 43 Kentucky 8,472,278 9,198,285 9,271,259 9,329,648 9,091,935 10,556, % 13 Louisiana 10,074,283 10,380,342 9,970,955 10,611,216 10,467,575 10,267, % 47 Maine 3,115,054 3,082,181 3,127,516 2,955,368 2,995,808 3,030, % 52 Maryland 7,983,403 8,584,407 8,974,094 8,790,056 9,199,334 9,810, % 16 Massachusetts 12,459,446 13,563,582 13,526,855 13,266,374 13,650,881 14,468, % 28 Michigan 16,862,167 18,925,689 19,638,746 19,217,911 19,100,223 20,217, % 21 Minnesota 8,286,553 8,707,869 9,330,672 9,678,784 9,364,666 10,589, % 10 Mississippi 6,787,061 7,406,274 7,443,094 7,900,474 7,630,695 7,635, % 36 Missouri 10,648,627 11,558,859 11,435,516 11,921,079 11,532,131 11,777, % 41 Montana 2,015,890 2,239,212 2,198,023 2,266,220 2,179,187 2,109, % 46 Nebraska 2,634,757 2,827,711 2,718,722 2,795,337 2,806,912 2,845, % 45 Nevada 2,590,949 2,976,229 3,063,383 3,185,961 3,311,366 3,934, % 1 New Hampshire 1,666,018 1,761,529 1,788,735 1,673,301 1,628,319 1,677, % 50 New Jersey 12,773,613 13,808,921 13,738,499 13,995,574 13,709,302 15,718, % 15 New Mexico 5,516,239 5,902,654 5,979,662 6,250,456 5,743,049 6,433, % 27 New York 48,869,914 54,209,701 55,867,960 56,302,585 54,524,859 59,783, % 17 North Carolina 15,537,035 15,784,935 15,603,643 16,854,374 17,067,157 17,661, % 33 North Dakota 1,375,979 1,466,228 1,442,514 1,458,365 1,437,312 1,544, % 38 Ohio 20,641,388 21,782,228 23,111,439 23,554,645 22,631,009 24,585, % 23 Oklahoma 6,429,776 6,913,028 7,017,756 7,248,276 7,069,094 7,222, % 37 Oregon 6,378,740 7,208,744 7,360,849 7,455,479 7,961,655 9,582, % 2 Pennsylvania 21,222,788 23,298,939 25,014,682 24,518,477 23,968,194 24,944, % 26 Rhode Island 2,331,871 2,530,871 2,594,630 2,530,425 2,495,307 2,895, % 14 South Carolina 7,706,022 8,311,135 8,407,736 8,357,616 8,024,798 8,517, % 42 South Dakota 1,556,989 1,713,343 1,691,095 1,661,745 1,600,173 1,585, % 48 Tennessee 12,146,191 11,890,204 12,845,737 13,305,442 13,897,753 14,000, % 31 Texas 37,258,921 41,060,382 42,939,208 42,928,124 43,072,685 45,213, % 20 Utah 3,616,613 4,049,958 4,228,904 4,292,772 4,087,475 4,189, % 29 Vermont 1,501,566 1,624,655 1,654,650 1,705,860 1,725,832 1,773, % 25 Virginia 8,805,836 9,768,629 9,999,207 10,153,038 10,310,330 10,751, % 18 Washington 9,096,969 9,977,556 10,553,713 10,852,952 10,232,945 12,376, % 7 West Virginia 4,118,784 4,455,111 4,558,616 4,603,829 4,679,380 4,898, % 24 Wisconsin 8,735,340 9,231,302 9,677,073 9,402,601 9,836,430 9,728, % 40 Wyoming 2,143,779 2,118,661 2,271,910 2,224,626 2,046,195 2,148, % 51 Puerto Rico 7,157,079 6,857,291 6,985,767 7,347,208 7,314,981 7,283, % 49 Total $522,734,077 $567,168,410 $588,916,061 $588,469,612 $598,299,295 $634,807, % FFIS Special Analysis Page 5

6 Table 2 Change in Population, Per Capita Federal Spending, FYs Per Capita Federal Spending Population (000s) State FY 2009 FY 2009 Rank FY 2014 FY 2014 Rank % Change Rank Rank % Change Alabama $1, $1, % 35 4,758 4, % Alaska 3, , % % Arizona 1, , % 42 6,343 6, % Arkansas 1, , % 17 2,897 2, % California 1, , % 5 36,961 38, % Colorado 1, , % 8 4,972 5, % Connecticut 1, , % 7 3,562 3, % Delaware 1, , % % District of Columbia 4, , % % Florida 1, , % 12 18,653 19, % Georgia 1, , % 33 9,621 10, % Hawaii 1, , % 3 1,347 1, % Idaho 1, , % 25 1,554 1, % Illinois 1, , % 27 12,797 12, % Indiana 1, , % 11 6,459 6, % Iowa 1, , % 29 3,033 3, % Kansas 1, , % 39 2,833 2, % Kentucky 1, , % 13 4,317 4, % Louisiana 2, , % 49 4,492 4, % Maine 2, , % 50 1,330 1, % Maryland 1, , % 20 5,730 5, % Massachusetts 1, , % 28 6,518 6, % Michigan 1, , % 15 9,902 9, % Minnesota 1, , % 10 5,281 5, % Mississippi 2, , % 31 2,959 2, % Missouri 1, , % 36 5,961 6, % Montana 2, , % , % Nebraska 1, , % 44 1,813 1, % Nevada , % 2 2,685 2, % New Hampshire 1, , % 48 1,316 1, % New Jersey 1, , % 14 8,756 8, % New Mexico 2, , % 24 2,037 2, % New York 2, , % 16 19,307 19, % North Carolina 1, , % 37 9,450 9, % North Dakota 2, , % % Ohio 1, , % 19 11,529 11, % Oklahoma 1, , % 38 3,718 3, % Oregon 1, , % 1 3,809 3, % Pennsylvania 1, , % 22 12,667 12, % Rhode Island 2, , % 9 1,054 1, % South Carolina 1, , % 43 4,590 4, % South Dakota 1, , % % Tennessee 1, , % 32 6,306 6, % Texas 1, , % 30 24,802 26, % Utah 1, , % 41 2,723 2, % Vermont 2, , % % Virginia 1, , % 23 7,926 8, % Washington 1, , % 6 6,667 7, % West Virginia 2, , % 18 1,848 1, % Wisconsin 1, , % 34 5,669 5, % Wyoming 3, , % % Puerto Rico 1, , % 40 3,740 3, % Total/U.S. Average $1,683 $1, % 310, , % FFIS Special Analysis Page 6

7 Table 3 FY 2014 Per Capita Federal Spending by Type of Grant State Medicaid Rank Other State Rank Individual/ Other Rank Local Rank Alabama $ $ $389 9 $ Alaska 1, , Arizona 1, Arkansas 1, California 1, Colorado Connecticut 1, Delaware 1, District of Columbia 2, , Florida Georgia Hawaii Idaho Illinois Indiana Iowa Kansas Kentucky 1, Louisiana 1, Maine 1, Maryland Massachusetts 1, Michigan 1, Minnesota 1, Mississippi 1, Missouri Montana , Nebraska Nevada New Hampshire New Jersey New Mexico 1, , New York 1, North Carolina North Dakota , Ohio 1, Oklahoma Oregon 1, Pennsylvania 1, Rhode Island 1, South Carolina South Dakota Tennessee 1, Texas Utah Vermont 1, , Virginia Washington West Virginia 1, Wisconsin Wyoming , Puerto Rico , U.S. Average $958 $601 $319 $91 FFIS Special Analysis Page 7

8 Table 4 FY 2014 Per Capita Federal Spending by Function Income Security Energy, Environment, Health and Social Services Education Transportation and Natural Resources State Dollars Rank Dollars Rank Dollars Rank Dollars Rank Dollars Rank Alabama $ $ $ $ $39 9 Alaska 1, Arizona 1, Arkansas 1, California 1, Colorado Connecticut 1, Delaware 1, District of Columbia 3, Florida Georgia Hawaii Idaho Illinois Indiana 1, Iowa Kansas Kentucky 1, Louisiana 1, Maine 1, Maryland Massachusetts 1, Michigan 1, Minnesota 1, Mississippi 1, Missouri 1, Montana Nebraska Nevada New Hampshire New Jersey New Mexico 1, New York 1, North Carolina North Dakota Ohio 1, Oklahoma Oregon 1, Pennsylvania 1, Rhode Island 1, South Carolina South Dakota Tennessee 1, Texas Utah Vermont 1, Virginia Washington West Virginia 1, Wisconsin Wyoming Puerto Rico U.S. Average $1,030 $500 $220 $162 $17 FFIS Special Analysis Page 8

9 Table 4, cont d FY 2014 Per Capita Federal Spending by Function Employment Community and General and Training Regional Development Government Justice Agriculture State Dollars Rank Dollars Rank Dollars Rank Dollars Rank Dollars Rank Alabama $ $ $ $ $ Alaska Arizona Arkansas California Colorado Connecticut Delaware District of Columbia Florida Georgia Hawaii Idaho Illinois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico New York North Carolina North Dakota Ohio Oklahoma Oregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee Texas Utah Vermont Virginia Washington West Virginia Wisconsin Wyoming , Puerto Rico U.S. Average $12.26 $12.24 $9.66 $4.13 $2.39 FFIS Special Analysis Page 9

3+ 3+ N = 155, 442 3+ R 2 =.32 < < < 3+ N = 149, 685 3+ R 2 =.27 < < < 3+ N = 99, 752 3+ R 2 =.4 < < < 3+ N = 98, 887 3+ R 2 =.6 < < < 3+ N = 52, 624 3+ R 2 =.28 < < < 3+ N = 36, 281 3+ R 2 =.5 < < < 7+

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