How Rhode Island Expenditures Compare - 2015 Edition

Rhode Island Public Expenditures Council

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How Rhode Island Expenditures Compare - 2015 Edition

PROVIDENCE, R.I. (November 2015) – RIPEC today released its annual report titled How Rhode Island Expenditures Compare, 2015 Edition which provides details on state and local government expenditures in Fiscal Year (FY) 2013, the most recent year for which national data are available. The publication compares Rhode Island’s spending with that of the other 49 states and the national average using data released by the United States Census Bureau. Two measures are used to make comparisons between states in RIPEC’s report – per $1,000 of personal income and per capita. To see the full report, click here.

In FY 2013, Rhode Island state and local government expenditures were above the national average when measured on personal income and per capita bases. Total expenditures of $236.12 per $1,000 of personal income exceeded the national average of $228.58 by 3.3 percent and placed the state 19th highest in the nation. Similarly, total per capita expenditures of $10,899 exceeded the national average of $10,202 by 6.8 percent and ranked the state 13th highest nationally. Among the New England states, Rhode Island’s total government expenditures exceeded all states except Vermont when measured on a personal income basis, but were fourth-highest when measured on a per capita basis.

Census categories where Rhode Island government expenditures exceeded the national average in FY 2013 on a per capita basis include education and libraries; social services and income maintenance; public safety; government administration and interest on general debt; and “other” expenditures. By contrast, Rhode Island’s per capita transportation and environment and housing expenditures were below the national average during the same fiscal year.  

The report also finds a continuation of spending patterns found in past reports. Vendor payments – payments made directly to private vendors for medical care on behalf of means-tested beneficiaries (e.g., Medicaid Title XIX and Medicare Part D payments) – continue to account for the largest share of growth in state and local expenditures in Rhode Island. Between FY 2002 and FY 2013, spending in this category accounted for 36.2 percent of the total change in direct general expenditures, compared to 24.4 percent nationally. Rhode Island’s expenditures for vendor payments now place the state fifth-highest on a per capita basis and seventh-highest on a personal income basis.

Similarly, spending on elementary and secondary education continues to be a major driver of state government spending, both in Rhode Island and throughout the nation. Between FY 2002 and FY 2013, elementary and secondary spending accounted for 26.0 percent of the total growth in state and local spending in Rhode Island, and 17.5 percent of the total increase nationally. Rhode Island continues to rank in the top half of the country for K-12 spending, spending the eighth most nationally on both per capita and personal income bases. By contrast, the state spends significantly less on higher education than the rest of the country, ranking 44th highest as a share of personal income and 46th highest per capita.

Public safety expenditures in Rhode Island also continued to be among the highest in the nation during FY 2013. Total public safety spending, including expenditures for police protection, fire protection, corrections and protective inspection and regulation ranked seventh-highest on a per capita basis and tenth-highest on a personal income basis. In particular, Rhode Island had the highest level of fire protection expenditures in the United States on both per capita and personal income bases. Rhode Island’s fire protection expenditures of $293 per capita during FY 2013 were more than twice the national average of $138 per capita; similarly, the state’s fire protection expenditures of $6.34 per $1,000 of personal income were also more than twice the national average of $3.09 per $1,000 of personal income.

Rhode Island’s total expenditures were driven in part by insurance trust expenditures, a category which includes government spending on social insurance operations such as public employee retirement systems, unemployment compensation and disability insurance trusts. Rhode Island’s FY 2013 insurance trust expenditures were fifth-highest in the nation when measured on both personal income and per capita bases. Insurance trust expenditures of $1,552 per capita in Rhode Island exceeded the national average of $1,075 per capita by 44.4 percent in FY 2013; similarly, Rhode Island’s expenditures of $33.63 per $1,000 of personal income exceeded the national average of $24.09 per $1,000 of personal income by 39.6 percent during the same fiscal year.