DiNAPOLI: NEW YORK REVERTS TO A NEGATIVE BALANCE OF PAYMENTS WITH FEDERAL GOVERNMENT, REFLECTING END OF PANDEMIC-ERA AID

 

NY Ranked 45th Among the States in FF2024

With the historic, multi-year pandemic aid from the federal government mostly in the past, New York returned to a negative balance of payments with Washington for the first time since Federal Fiscal Year (FFY) 2019, according to a report by State Comptroller Thomas P. DiNapoli. In FFY 2024, the state generated $353.5 billion in federal taxes and received $341.1 billion in federal spending. New York’s balance of payments amounted to a negative $12.4 billion. For every $1 in federal tax paid to Washington, the state received $0.97 in return, compared with a national level of $1.21.

New York has historically been a state that pays more in federal taxes than it receives in federal spending. This pattern was temporarily altered by substantial increases in federal spending spurred by the COVID-19 pandemic. All states had a positive balance of payments in FFYs 2020 and 2021, and New York continued to have one through FFY 2023. In FFY 2024, New York was only one of ten states with a negative balance of payments.

“The state is once again sending more money to Washington than it gets back,” DiNapoli said. “With the impact of the federal pandemic aid largely gone, New York returns to the familiar position of being in the red. With damaging policies being implemented by the federal government, New York could have a disproportionate reduction in federal funding which will only worsen the state’s balance of payments in future years.”

In FFY 2024, every U.S. resident, on average, benefitted from approximately $16,999 in federal expenditures and paid approximately $14,008 on average in federal taxes – a positive $2,991 per capita. In contrast, for New Yorkers, the per capita amount was negative (-$618).

Key findings in DiNapoli’s report include:

• New York generated $17,674 per capita for the federal treasury, ranking it third among states in FFY 2024. The state received $17,056 per capita, ranking it 25^th in per capita federal spending.
• Federal income taxes made up the largest portion of taxes New Yorkers paid, $9,527 per capita – 34.7% higher than the national average of $7,075.
• New York ranked second on per capita for corporate income taxes, at $2,098, which was 35.4% higher than the national per capita amount of $1,549.
• New Mexico continued to rank first in per capita balance of payments (+$18,111), followed by Virginia, Alaska, Hawaii and West Virginia. New York ranked 45^th and New Jersey ranked lowest (50^th).

Programs Where New York Ranks High

In FFY 2024, New York received $60.8 billion in Medicaid funding, or $3,040 per capita, 68.5% higher than the national average of $1,804, ranking it third in the U.S. New York’s robust social safety net encompasses more than public health programs and the state receives strong levels of support from many other areas of federal funding, including: the Supplemental Nutrition Assistance Program (SNAP), public housing and rental assistance, Temporary Assistance for Needy Families (TANF), and the Low-Income Home Energy Assistance Program.

For 2024 per capita spending, New York ranked first on rental assistance and public housing, and TANF; fifth on homeless assistance grants; sixth on SNAP and eighth on grants for child and family services. New York also is among the highest in the nation on transit grants (third per capita) and on Pell Grants for undergraduate students (10th per capita).

Programs Where New York Ranks Low

Similar to findings in DiNapoli’s prior analyses, New York’s per capita share tends to be low in areas related to the federal workforce, retirement payments, and veterans’ benefits; much of this related to New York’s relatively smaller number of federal employees and veterans. New York also ranked lower on per-capita highway spending (49^th) and procurement (44^th).

This report is the tenth issued by DiNapoli’s office detailing the differences among the 50 states with respect to what they pay in federal taxes and how much they receive in federal spending. New York’s former U.S. Sen. Daniel Patrick Moynihan pioneered the concept of this balance of payments and issued his first report in 1977.

Report

New York’s Balance of Payments in the Federal Budget, Federal Fiscal Year 2024

Downloadable Excel File with Additional Data