New Report Shows State Government Spending Up 5.7% in Fiscal 2019
Thursday, November 21, 2019 | Comments

In fiscal 2019, total state government spending rose 5.7%, according to the latest report from the National Association of State Budget Officers (NASBO). In fiscal 2018, total state spending grew at a slower rate of 3.4%.

NASBO’s latest State Expenditure Report shows that in fiscal 2019, all program areas experienced an increase in total state spending, with the largest percentage gains in transportation and the “all other” category.

“Accelerated growth in state revenues in the last two fiscal years enabled larger investments in transportation and education, a partial recovery since the great recession in human services and public-safety spending, and significant progress in building up reserves,” said NASBO Executive Director John Hicks. “An increase in federal funding also helped contribute to overall state spending growth in fiscal 2019.”

Spending from states’ own funds (general funds and other state funds combined, excluding bonds) rose 5.9% in fiscal 2019, the highest annual growth rate since the last recession. Transportation and the “all other” category experienced strong spending growth from state funds in fiscal 2019, increasing 8.9% and 8.6%, respectively. Increases in the “all other” category included additional spending for pension fund contributions, employee compensation, deposits to reserve funds, debt service, disaster recovery and homelessness programs.

Spending from federal funds to states also rose in fiscal 2019, increasing 4.7% compared to 3.5% in fiscal 2018, partly because of recent federal budget agreements. State tax collections experienced strong gains in both fiscal 2018 and fiscal 2019, rising 6.9% in fiscal 2018 and 4.2% in fiscal 2019, following two years of slow growth in fiscal 2016 and fiscal 2017.

The full report is here.

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