State and local governments took in more than $3.1 trillion in total revenues, most ($1.3 trillion) from taxes, according to the latest findings from the U.S. Census Bureau's 2007 Census of Governments. Revenues have risen 69.6 percent since the last census in 2002 (see Table 1 [Excel]).
At the same time, expenditures for state and local governments totaled more than $2.7 trillion, with education ($776.6 billion), public welfare ($377.4 billion) and highways ($144.8 billion) as the top three activities. Overall, state and local government expenditures rose 29.5 percent since 2002.
The findings come from the 2007 Census of Governments data on state and local government finances and show revenues, expenditures, debt, and cash and security holdings for state and local governments, the nation and for each state. Aggregate figures are given for total state and local finances. The Census Bureau also releases these data annually based on the Annual Survey of Local Government Finances.
"The 2007 Census of Government Finance data are important because they provide a baseline on state and local government finances that analysts can use in weighing difficult policy choices regarding programs and taxes," said Don Boyd, senior fellow of the Nelson A. Rockefeller Institute of Government.
The percentage spent by state and local governments varies greatly by function. In the case of education, police, fire protection and housing, for example, spending is largely by local governments (Tables 2-5 [Excel]).
In the case of public welfare, highways and corrections, state governments generally contribute proportionately more than local governments (Tables 6-8 [Excel]).
State and local government spending on education totaled more than 40 percent of expenditures in Vermont (41.4 percent), Michigan (40.6 percent), Texas (40.3 percent) and Arkansas (40.2 percent).
State and local government spending on public welfare was greater than 20 percent of expenditures in 13 states and the District of Columbia, with D.C. (25.5 percent), Maine (24.3 percent), Rhode Island (23.7 percent), Minnesota (22.8 percent) and Vermont (22.7 percent) at the top.
The leading states in state and local government expenditures for highways were South Dakota (15 percent), Alaska (13.7 percent) and North Dakota (13 percent).
Since the data in these tables are from a Census of Governments, the data are not subject to sampling variability, but are subject to coverage, response and processing errors as well as errors of nonresponse.
For more information on the data limitations, definitions and methodology, see http://www2.census.gov/govs/estimate/2007_Local_Finance_Methodology.pdf.