A new report (PDF) from the state’s non-partisan Senate Fiscal Agency says Michigan falls nearly $14 billion short of its fair share in federal revenue. The report, which uses census data and reports on federal spending to compile a per capita figure for federal spending per state, includes federal funds used for salaries and pensions, grants to state and local governments, procurement spending from Michigan companies and direct payments to Michigan residents through programs like Medicaid.
The report says:
Historically, Michigan’s share of Federal expenditures has lagged behind the amount of most other states. As measured on a per-capita basis, in FY 2007 total Federal expenditures in Michigan equaled $7,114. The national average for all states on a per-capita basis was $8,339…Michigan’s total per-capita expenditures ranked 45th among the states. The only two broad categories of Federal expenditures in which Michigan was close to the national average were the categories of retirement and disability payments to individuals and other direct payments to individuals. Michigan ranked 26th and 27th on a per-capita basis for these types of Federal expenditures. Michigan’s rank was 49th among the states in Federal salaries and wages, 38th among the states in procurement, and 41st among the states in grants to state and local governments…
An analysis of the Census Bureau data leads to the conclusion that the citizens of Michigan are receiving much less than their fair share of Federal expenditures if the expenditure distributions are viewed simply on a per-capita basis.
The report also cites the reason for this shortfall:
The Federal funding shortfall in Michigan can be attributed to two major factors. First is that Michigan has a smaller proportion of Federal employees compared with other states, resulting in a ranking of 49th in Federal salaries and wages. The second is the lack of major defense facilities or major defense contractors within Michigan. This accounts for Michigan’s ranking of 38th among the states in per-capita Federal procurement.
Because the latest data available is for fiscal year 2007, these figures are likely out of date. The huge influx of federal funds to rescue the auto industry over the last 9 months will probably mean a big jump in per capita federal spending in Michigan for 2008 and 2009.