What Drives State Spending
Major Categories of State Spending
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Chart 8: FY 2002
Total Funds Budget by Program Area
Chart 9: FY
2002 General Fund Budget by Program Area
Total Funds Budget (Chart 8)
Much of the $7.4 billion total state budget has restrictions on how the money is
spent:
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Permanent Fund Earnings
About $1.8 billion of Permanent Fund earnings pay for dividends ($1.1 billion)
and inflation proofing ($700 million). The PFD program is by far the largest
single state expenditure and has been the fastest growing program for the past
decade.
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Federal Funds
About $2.1 billion is federal funding which has restrictions on how it may be
spent and requires a $253 million state general fund match.
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Other Funds
A little over $1 billion comes from sources such as university tuition
receipts, AHFC dividend, endowment and trust receipts. Most of these funding
sources have restrictions on how they may be spent, e.g., AHFC dividends are
devoted to debt service payments on bonds and Public School Trust earnings are
dedicated to school funding. This category includes self-supporting enterprises
and activities like the international airports. Other funds do not figure into
the fiscal gap.
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Formula Programs $1.6 billion goes for formula programs where the level
of funding is determined by a formula set in statute -- largest are K-12
education at $782 million and Medicaid at $577 million. Others include revenue
sharing, longevity bonus, welfare, and foster care.
General Fund Budget (Chart 9)
General funds are mostly oil revenues and the legislature has discretion over
how they may be spent. The fiscal gap is measured as the difference between
general fund revenues and general fun expenditures.
The large majority of expenditures in the general funds budget are committed to
services that most people recognize as standard government functions. These
include: K-12 education (29%), formula programs (14%), public safety (14%),
university (8%), transportation (7%), health and social services (6%), natural
resource management (4%) and debt service (4%).
The remaining 14% piece represents all other general government functions. These
include economic development, senior services, public health, motor vehicle
services, revenue collection, finance, the legislature, the governor's office
and many others.
Unmet Needs and Deferred
Maintenance -->
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