Alaska Tops in Federal Dollars, Census Says

The federal government spent about twice as much per capita in Alaska than in Nevada where per capita federal spending was less than $5,000 last year, according to a U.S. Census Bureau report released April 23.

The report showed that per capita federal spending was highest in Alaska ($10,214), followed by Virginia ($10,067), North Dakota ($9,262), New Mexico ($9,118), and Maryland ($9,094).

Federal spending per capita, which is influenced by the number of federal employees or federally funded programs in a state, also was high in Hawaii, South Dakota, Montana, Wyoming, and Alabama.

The lowest per capita federal spending was, in descending order, in New Hampshire, Utah, Minnesota, Wisconsin, and Nevada, according to the Census' Consolidated Federal Funds Report.

The report covers most domestic spending by the federal government, and tax researchers use it to calculate which states bear the heaviest tax burden.

The report showed federal domestic spending totaled $1.8 trillion, up nine percent in 2001. Social Security, Medicare, and Medicaid accounted for $854 billion last year, 48 percent of the U.S. government's domestic spending.

Five states combined were the recipients of one third of all federal spending. In order of federal spending, these were California, New York, Texas, Florida, and Pennsylvania.

The report showed that U.S. average per capita spending was just over $6,000.

Maryland's per capita federal spending dropped from No. 3 to No. 5 behind North Dakota and New Mexico in 2001. Utah improved its ranking in 2001 from No. 49 to No. 47.

Tax analysts say federal expenditures can affect a state's financial health.

"If you're sending more money out than you're getting in, that's going to have an economic impact on that state. But a lot of these trends take decades to play out. It's very hard for any single congressman or even senator to affect how these ratios work," said Scott Moody, senior economist for the Tax Foundation, an organization that ranks which states pay more than their "fair share" of federal taxes. "

The Census report also showed that the Defense Department spent $255 billion, up 7.2 percent over 2000. But defense spending decreased in 13 states (Delaware, Idaho, Iowa, Louisiana, Maine, Minnesota, Mississippi, Nebraska, New Jersey, New York, Rhode Island, Tennessee, and Texas).

More federal defense spending went to California, Virginia, Texas, Florida, and Georgia last year than anywhere else in the nation, according to the report.

All the top-ranking states saw increases in the amount of defense spending in 2001 except Texas, where spending dropped by $2 billion or 12 percent. Georgia replaced Maryland in 2001 in ranking fifth in the amount of defense dollars spent in the state.

In Connecticut, federal defense spending increased 77 percent to $4.7 billion. Virginia's share increased 22.3 percent to $30 billion.

Defense spending, which includes procurement, soldiers' salaries, and base operation, historically has gone to southern and western states while New England has had lower per capita defense spending, said Matt Kane, policy analyst for budget issues for the Northeast Midwest Institute.

The Defense Department spent $31.3 billion in California, $30 billion in Virginia, $18.1 billion in Texas, $13.7 billion in Florida, and $11 billion in Georgia.