The federal government spent $2.1 trillion in the 50 states, the District of Columbia, Puerto Rico and outlying areas during 2003, according to two reports released today by the U.S. Census Bureau. This was a 6 percent increase over 2002.

     Consolidated Federal Funds Report for Fiscal Year 2003 (State and County Areas) [PDF] covers benefits, subsidies, grants, goods and services, and salaries and wages. A companion report, Federal Aid to States for Fiscal Year 2003 [PDF], contains federal agency and program-level data on grants to state and local governments.

     First in total government outlays, California received $220 billion, followed by Texas ($140 billion), New York ($138 billion), Florida ($113 billion) and Pennsylvania ($90 billion). One-third of all federal expenditures went to these five states, which account for 37 percent of the total U.S. population.

     Social Security, Medicare and Medicaid accounted for $950 billion (46 percent) of the U.S. government’s 2003 domestic spending.

     The largest percentage increases in fiscal year 2003 federal spending were in the categories of procurement awards, grants, and salaries and wages. Procurement awards, at $327 billion, increased 14 percent over fiscal year 2002, with Department of Defense (DOD) contracts totaling $201 billion, or 61 percent.

     Federal government salaries and wages were $211 billion, up 5.9 percent over 2002, with the Department of Defense (39 percent) and the U.S. Postal Service (24 percent) making up nearly two-thirds of the total.

      Direct payments to individuals for retirement and disability reached $636 billion in 2003, up 3.8 percent over 2002, with Social Security alone totaling $509 billion, a 3.6 percent increase.

     Other direct payments totaled $446 billion, an increase of 5.2 percent over 2002. These payments included Medicare at $274 billion, up 9.1 percent, plus unemployment compensation ($51 billion), excess earned income tax credits ($33 billion) and food stamp payments ($21 billion).

     At the county or county-equivalent level, Los Angeles County, Calif., with $56.5 billion, led the list of recipients. It was followed by New York City, N.Y. ($56.3 billion); Cook County, Ill. ($31.4 billion); San Diego County, Calif. ($24.0 billion); and Maricopa County, Ariz. ($19.1 billion).

     Per capita federal spending among states, meanwhile, was highest in Alaska ($12,244), Virginia ($11,163), Maryland ($10,464), New Mexico ($9,995) and North Dakota ($9,033). The rest of the top 10, in order, were: Hawaii ($8,961), Wyoming ($8,432), Connecticut ($8,209), Alabama ($8,192) and South Dakota ($8,114). Factors affecting per capita spending were the state’s population, the number of its federally funded programs and the number of federal employees residing in the state.

     Resident population as of July 1, 2003, was used to calculate per capita amounts for states, counties and county-equivalent areas.

DOD Spending

      The Department of Defense spent a total of $320 billion domestically in 2003, up 12.2 percent over 2002. This amount included procurement contracts, payroll, military pensions and grants.

     Defense Department spending in 2003 was the highest in the following five states: California ($39.2 billion), Virginia ($32.7 billion), Texas ($30.4 billion), Florida ($16.0 billion) and Maryland ($11.4 billion). The top five counties or equivalents in federal defense expenditures were: Los Angeles ($11.2 billion) and San Diego ($10.6 billion) counties in California; Tarrant County, Texas ($10.4 billion); Fairfax County, Va. ($7.6 billion); and Maricopa County, Ariz. ($5.2 billion).

     In addition to providing an overall picture of the federal government’s domestic spending, the reports break out spending by federal agencies for fiscal year 2003 (Oct. 1, 2002 – Sept. 30, 2003). For the first time, data are shown for the Department of Homeland Security, which was created on Jan. 24, 2003.

     The data in these reports are not subject to sampling variability, but are subject to nonsampling errors, which include errors of response and processing. For additional information, refer to the introductory text in the reports.

Please Note: These reports present data for states and counties only. Therefore, the data are not directly applicable for other areas such as places and congressional districts.

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