How Rhode Island Expenditures Compare – 2013 Edition

PROVIDENCE, R.I. (October 2013) – Today RIPEC released its annual report: How Rhode Island Expenditures Compare, which provides details on  state and local government expenditures in FY 2000 and FY 2011, the latest year for which national data is available.  This year’s report also includes an analysis of the changes between FY 2010 and FY 2011.  The publication compares Rhode Island’s spending with that of the other 49 states and the national average using data released by the US Census Bureau.  To see the full report, click here.

Rhode Island’s total direct general expenditures as a share of personal income are slightly lower than the national average ($203.84 nationally, compared to $203.69 in Rhode Island).  On a per capita basis, the Ocean State’s total spending of $8,769 was 4.8 percent higher than the national average of $8,366.  

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.  Over the past eleven years, spending in this category accounted for 37.1 percent of the total change in direct general expenditures, compared to 21.1 percent nationally.  

Similarly, spending on elementary and secondary education continues to be a major driver of spending, both at the state and national level.  Between FY 2000 and FY 2011, elementary and secondary spending accounted for 23.3 percent of the total growth in state and local spending in Rhode Island, and 18.5 percent of the total increase nationally.  Rhode Island continues to rank in the top half of the country for K-12 spending, both as a share of personal income (15th highest) and per capita (8th highest).  In contrast, the state spends significantly less on higher education than the rest of the country, ranking 45th as a share of personal income and 47th per capita.  

Insurance trust expenditures, which are outside of general expenditures, and include unemployment compensation, worker’s compensation and employee retirement costs, also increased over the past decade.  The primary driver of this increase was unemployment compensation, which increased by 5.5 percent nationally, and 3.4 in Rhode Island over the eleven-year period.  However, unemployment compensation expenditures declined between FY 2010 and FY 2011 by 11.1 percent in Rhode Island and by 10.0 percent nationally.   

Additionally, national and state transportation spending increases contributed between 5.9 percent (nationally) and 6.4 percent (in Rhode Island) to overall changes in direct general expenditures. Nationally, transportation spending increases were driven by increases in highway spending, whereas in Rhode Island, transportation funding increases were driven chiefly by airport spending. Rhode Island currently ranks 4th in the nation for other transportation spending—a category which includes parking, air transport, and sea and inland port facilities. However, state transportation spending lags national averages on a personal income and per capita basis ($12.52 v. $14.40; and $539 v. $591, respectively).

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