ALBANY New York State taxpayers sent the federal government some $47 billion more in taxes than the state received in federal spending in fiscal year 2000, according to a new analysis by The Public Policy Institute.
The deficit in the state's "balance of payments" with Washington is the largest ever, and up from $37.4 billion in 1999, the Institute found. The Institute is the research affiliate of The Business Council of New York State Inc.
"The size of our imbalance of payments represents a larger-than-ever economic drain on the Empire State," Daniel B. Walsh, president/CEO of The Business Council and CEO of the Institute, wrote in a letter to members of New York's Congressional delegation. Walsh told the delegation that the new research "demonstrates the rightness of the cause for which Governor Pataki and you have been fighting in recent weeks - a fair assistance package to help with rebuilding in the wake of the terrorist attacks."
In fiscal 2000, the Internal Revenue Service collected more than $166 billion in taxes on economic activity in New York State. Federal agencies returned an estimated $119 billion in grants, procurement and other expenditures.
The Public Policy Institute analysis is based on the research performed in past years for former Senator Daniel Patrick Moynihan by experts at Harvard University's Kennedy School of Government. It uses the same base data as the Kennedy School analyses - tax data from the Tax Foundation, a non-partisan research group based in Washington, and expenditure data from the U.S. Census Bureau. The Public Policy Institute's analysis differs slightly from the Kennedy School's methodology; for instance, the Institute's calculations use actual tax and spending data rather than adjusting those numbers to reflect cost-of-living differences among the states.
Table 1: New York State's Balance of Payments with WashingtonFY 2000 (dollars in millions) Total federal taxes paid by New Yorkers1 $158,508 Federal taxes paid by New Jersey and Connecticut residents who work in New York2 8,175
A: Federal taxes on New York $166,693 Nominal federal expenditure in New York3 $110,333 Allocated share of interest on federal debt4 9,012 B: Federal expenditures in New York $119,345 New York's balance of payments (B - A) -$47,338 Largest Losers in Federal Balance of Payments California -$63,319 Michigan -$20,531 NEW YORK -$47,338 Connecticut -$15,910 Illinois -$40,205 Florida -$15,767 New Jersey -$27,267 Massachusetts -$14,245 Texas -$23,099 Ohio -$11,699 Calculations by The Public Policy Institute 1 Source: Tax Foundation, Washington, D.C. 2 New Jersey residents paid $81 billion, and Connecticut residents $39 billion, in federal taxes in 2000. Approximately 7% of federal taxes collected in New Jersey, and 6.4% of those from Connecticut, are attributable to jobs in New York State. (Percentages are based on New York State Department of Taxation and Finance figures for state taxes paid by New Jersey and Connecticut residents.) 3 Source: US Census Bureau, Consolidated Federal Funds Report for Fiscal Year 2000. 4 Total interest paid domestically on federal debt was $113 billion; the 8 percent proportion allocated to New York is the state's share of total federal tax payments. Table 2: States' Balance of Payments with Washington
(Dollars in millions) State Taxes Paid Spending Received Surplus/Deficit Alabama 23,502 30,553 7,051 Alaska 4,374 6,202 1,828 Arizona 30,749 30,992 243 Arkansas 13,256 15,582 2,326 California 253,481 190,162 -63,319 Colorado 33,212 24,806 -8,406 Connecticut 36,489 21,733 -14,756 Delaware 5,844 4,291 -1,553 Florida 115,086 99,319 -15,767 Georgia 53,105 45,479 -7,626 Hawaii 7,135 9,421 2,286 Idaho 6,678 7,389 711 Illinois 100,213 65,705 -34,508 Indiana 38,605 30,918 -7,687 Iowa 17,521 15,747 -1,774 Kansas 17,343 15,246 -2,097 Kentucky 21,456 25,664 4,208 Louisiana 23,014 27,263 4,249 Maine 7,336 8,266 930 Maryland 42,232 47,490 5,258 Massachusetts 58,389 44,144 -14,245 Michigan 71,414 50,883 -20,531 Minnesota 37,648 25,132 -12,516 Mississippi 12,728 19,082 6,354 Missouri 35,118 37,684 2,566 Montana 4,597 6,178 1,581 Nebraska 10,946 10,233 -713 Nevada 15,461 9,505 -5,956 New Hampshire 10,114 6,377 -3,737 New Jersey 75,341 48,075 -27,266 New Mexico 8,795 14,970 6,175 NEW YORK 166,683 119,345 -47,338 North Carolina 48,436 44,121 -4,315 North Dakota 3,495 5,444 1,949 Ohio 73,217 61,518 -11,699 Oklahoma 17,436 21,604 4,168 Oregon 22,108 17,810 -4,298 Pennsylvania 85,630 78,183 -7,447 Rhode Island 7,191 7,285 94 South Carolina 21,659 23,525 1,866 South Dakota 4,338 5,385 1,047 Tennessee 34,441 35,518 1,077 Texas 137,404 114,305 -23,099 Utah 11,662 10,700 -962 Vermont 3,855 3,581 -274 Virginia 52,243 65,679 13,436 Washington 48,066 36,630 -11,436 West Virginia 8,300 12,211 3,911 Wisconsin 36,122 26,354 -9,768 Wyoming 3,645 3,427 -218 The Public Policy Institute