State Government Revenues Exceed Expenditures in 2013

New Government Finance Statistics from Annual Survey of State Government Finances and Annual Survey of Public Pensions       Total state government revenue rose by 16.3 percent, from $1.9 trillion in 2012 to $2.2 trillion in 2013, according to the latest findings on state government finances from the U.S. Census Bureau.         Nearly three-quarters of that increase (73.9 percent) is attributable to the growth in insurance trust revenue, which grew by 89.7 percent, from $255.8 billion in 2012 to $485.2 billion in 2013, and is comprised mostly of pension systems administered by state governments. These insurance trust figures reflect the market value of investments, meaning that they are affected by fluctuations in capital markets and not solely by governments’ fiscal policies.Total expenditures for state governments were $2.0 trillion, an increase of 1.2 percent from 2012.       “Unlike in 2012, total revenues exceeded total expenses,” said Kevin Deardorff, chief of the Census Bureau’s Economy-Wide Statistics Division. “Finances of state governments are closely tied to prevailing economic conditions, and this survey provides a look at their fiscal condition and how their financial activities stack up against other states.”       General revenues for state governments were $1.7 trillion in 2013, an increase of 4.9 percent from $1.6 trillion. The major sources of general revenue were taxes (49.5 percent), federal grants (30.0 percent) and current charges (10.7 percent). General expenditures also rose but at a lower rate, rising 2.1 percent, from $1.6 trillion in 2012 to $1.7 trillion in 2013.        The findings are from the Annual Survey of State Government Finances, which shows revenues, expenditures, debt, and cash and security holdings for each state, as well as a national summary of state government finances. The major source of these finance statistics is the governments’ own accounting systems, either directly from a government’s own records or through intermediate reporting systems.       States that reported the highest increases in general revenues from 2012 to 2013 were North Dakota, which increased 14.0 percent from $7.1 billion to $8.1 billion, followed by New York (up 11.2 percent from $148.6 billion to $165.2 billion) and California (up 10.2 percent from $199.4 billion to $219.7 billion).       Additional data from the Annual Survey of Public Pensions were also released today. Contributions to state and local public employee pension systems rose 7.2 percent, from $143.4 billion in 2012 to $153.8 billion in 2013. Earnings on investments, which are affected by fluctuations in capital markets, rose 311.9 percent, from $93.1 billion to $383.3 billion between 2012 and 2013.        The Annual Survey of Public Pensions findings provide revenues, expenditures, financial assets, and membership information for the defined benefit public pension systems. Additional Findings for State Government Finances: ·         In 2013, taxes totaled $847.1 billion. This was an increase of 6.1 percent from the 2012 total of $798.6 billion, and 11.1 percent from 2011, when they totaled $762.4 billion. ·         Federal grants accounted for nearly a third (30.0 percent) of all state government general revenue in 2013. This compares with the 2012 proportion, which was 31.6 percent. Federal grants to states decreased 0.1 percent from $514.1 billion in 2012 to $513.5 billion in 2013, due in part to the discontinuation of the American Recovery and Reinvestment Act of 2009. ·         Lottery ticket sales increased 4.9 percent from $59.4 billion in 2012 to $62.4 billion in 2013. Lottery prizes also increased, up 4.8 percent from $37.0 billion in 2012 to $38.8 billion in 2013. ·         Expenditure for education, the single largest functional activity of state governments, totaled $599.2 billion in 2013, an increase of 1.8 percent from $588.3 billion in 2012. ·         Total public welfare expenditures increased 6.1 percent, from $489.2 billion in 2012 to $519.2 billion in 2013. ·         Total health and hospital spending increased from $130.6 billion in 2012 to $130.7 billion in 2013. ·         Total expenditures on highways decreased 2.7 percent, from $115.3 billion in 2012 to $112.2 billion in 2013. ·         Interest payments on general long-term debt decreased 2.4 percent, from $47.3 billion in 2012 to $46.1 billion in 2013. Additional Findings for State- and Locally-Administered Public Pensions: ·         Total benefit payments increased 7.1 percent, from $226.7 billion in 2012 to $242.9 billion in 2013. ·         Total contributions increased 7.2 percent, from $143.4 billion in 2012 to $153.8 billion in 2013. Within this category, employee contributions went up 4.2 percent, from $43.3 billion to $45.1 billion, while government contributions went up 8.5 percent, from $100.2 billion to $108.7 billion. ·         Total cash and investment holdings increased 8.7 percent, from $3.0 trillion in 2012 to $3.3 trillion in 2013. ·         Total membership decreased 0.3 percent from 19.6 million to 19.5 million.       Government financial data are presented within four broad activity sectors: general government, utilities, liquor stores and insurance trust sectors. The general government sector includes all government revenue and expenditure activities that are consistent with government functions, such as public protection, education, health and welfare, and the like. These activities are distinct from the business-like activities presented in the remaining three sectors (utility, liquor stores and insurance trusts).