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Albany, NY — New York State's balance of payments (BOP) with the Federal government is a net negative $19.4 billion for Federal fiscal year (FFY) 2022, according to the Rockefeller Institute of Government's latest report, Giving or Getting? New York’s Balance of Payments with the Federal Government.
For the seventh consecutive year, the Institute is publishing its report examining the amount of Federal funding that every state generates and receives and the respective net difference between the two. The report sheds light on these differences and how they have changed over time and serves as an evidence base for policymakers as they deliberate over the redistribution of Federal funding.
The results of this year’s analysis for FFY 2022 represent a dramatic break from the prior two years when New York received a net positive of $122.7B (2021) and $155.8B (2020). On a per capita basis, New York's balance of payments fell from $6,178 in 2021 to -$984 in 2022. These findings appear to represent a return to New York's pre-pandemic balance of payments position relative to the Federal government.
"As we predicted in prior years' analysis, the fiscal relationship between New York State and the Federal government has shifted dramatically in favor of the Federal government as population-based pandemic emergency aid programs expired," said Rockefeller Institute President Bob Megna. "As New York State confronts significant challenges related to immigration, housing, and climate change, among other areas, policymakers should keep these findings in mind."
Other findings from the report include:
- With 2022 COVID-19-related spending only a fraction of what it was during the prior two years, New York’s dollar BOP has once again become more reflective of the state’s level of wealth, which is highly concentrated among a relatively small class of taxpayers, and therefore much less reflective of the needs of the majority of New Yorkers. As a result, New York has returned to its pre-pandemic position as a net subsidizer of other states.
- The remaining five states with the least favorable dollar BOPs include California (-$72.0 billion), Massachusetts (-$30.0 billion), Washington (-$22.5 billion), and New Jersey (-$19.4 billion).
- Based on preliminary data, New York posted a negative balance of payments of $19.4 billion, after two consecutive years of large positive BOPs. New York’s strong showing in 2020 and 2021 appears to have been a direct consequence of New York receiving a share of Federal emergency COVID-19 spending that was commensurate with its population size and need.
- With the worst of the pandemic in the rearview mirror and the economy on the mend, FFY 2022 saw an estimated 78 percent drop in Federal COVID-19 emergency spending, an 8.0 percent decline in total Federal expenditures, and a 21.0 percent increase in budgetary receipts. New York experienced a comparable 21.5 percent increase in tax receipts but saw a 74.5 percent decline in COVID-19 funding and an 18.8 percent decline in expenditures overall. As a result, New York’s BOP plummeted from a rank of fifth in both 2020 and 2021 to 46th in 2022.
- The five states with the most favorable BOPs in 2022 were Virginia ($129.2 billion), Maryland ($71.6 billion), Kentucky ($65.4 billion), Ohio ($56.7 billion), and North Carolina ($52.7 billion).
- For every dollar New York sent to the Federal government, it received only $0.95 in Federal expenditures. This compares to an average of $1.40 received for every dollar contributed across the 50 states.
- Adjusting for population size, New York’s BOP dropped from a positive $7,750 in 2020 and $6,178 in 2021 to a negative $984 in 2022. The 2022 decline was associated with a deterioration in the state’s ranking from 34 and 39 in 2020 and 2021, respectively, to 42 in 2022. The bottom five states on a per capita basis were New Hampshire (-$2,049), New Jersey (-$2,091), Washington (-$2,894), Massachusetts (-$4,302), and Connecticut (-$4,909).
- The five states with the most favorable BOPs in 2022 on a per capita basis were Virginia ($14,888), Kentucky ($14,507), Alaska ($14,031), New Mexico ($13,009), and Maryland ($11,617).
- The national average per capita balance of payments for FFY 2022 is $2,799. New York received $3,783 less than the national average on a per capita basis. This difference, which defines the state’s excess burden, is the largest in the history of this analysis.
Read the full report and view the interactive data dashboard.
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