Washington – A Pew Charitable Trust report released Tuesday shows that federal dollars, as a percentage, account for less revenue in Connecticut than most other states.

The report said the U.S. government provided states an average of 32.4% of all the federal revenue collected in fiscal year 2017—down slightly from 32.6% a year earlier. In Connecticut, federal money accounted for about 27% of the state’s revenues in 2017, down from 27.9% the previous year. Only seven states got a lower percentage of federal funds than Connecticut.

Pew noted that fiscal 2017 marked the first time that the 31 states with expanded Medicaid coverage, including Connecticut, had to pick up 5% of the costs of insuring enrollees who became eligible under the Affordable Care Act.

“Still, federal funds were at their fourth-highest level in more than 50 years as a percentage of 50-state revenue, based on data going back to 1961, underscoring the significant role that federal dollars play in financing state government,” the report said.

Because it was allowed under the ACA, Connecticut and other states expanded Medicaid coverage to uninsured adults whose incomes are at or below 138% of the federal poverty level – creating a program known as HUSKY D.

As of July, 2017 Connecticut has added about 217,000 of these adults to HUSKY under the ACA expansion, according to the Connecticut Department of Social Services.

The states that expanded their Medicaid programs will receive even less federal health grant money next year, as they gradually become responsible for 10% of the cost of Medicaid coverage for single adults by Jan. 1, 2020.

According to the Pew report, there is a wide range in the amount of money states received from the federal government in 2017.

Montana received the highest percentage of state revenue from Washington D.C. — 46.1% — while Virginia (21.1%) and Kansas (23.3%) had the lowest percentage share of federal money.

The Pew study is an incomplete assessment of how much federal money comes to the state because it does not include federal contracts won by private companies in Connecticut, money to individuals in the form of  Social Security benefits, or Medicare payments to state doctors and hospitals.

For example, federal contracts with Connecticut-based companies have trended to be about $13 billion a year, though last year was only $12 billion, according to USAspending.gov data. Most of the money spent is on defense contracts.

Still, considering all federal payments to the state — including federal grants, federal contracts, Medicare and Social Security payments, and salaries of federal workers in Connecticut — the state pays more to Washington D.C. in taxes than it receives in funding and is considered a “donor” state.

According to the Rockefeller Institute of Government, Connecticut is the nation’s top donor state, with state residents receiving just 74 cents back for every $1 paid in federal taxes.

Massachusetts, New Jersey, New York, North Dakota, Illinois, New Hampshire, Washington state, Nebraska and Colorado round out the list of donor states. The residents of most of those states, like Connecticut, have higher-than-average incomes.

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Ana has written about politics and policy in Washington, D.C.. for Gannett, Thompson Reuters and UPI. She was a special correspondent for the Miami Herald, and a regular contributor to The New York TImes, Advertising Age and several other publications. She has also worked in broadcast journalism, for CNN and several local NPR stations. She is a graduate of the University of Maryland School of Journalism.

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4 Comments

  1. Norwalk sends 90% of our taxes to the State of Connecticut and then the State calls us/considers us, part of the ‘gold coast’ and treats us that way when diveying up (our) tax dollars to (other) municipalities— even though Norwalk schools schools are 60% free-reduced lunch. Norwalk is a ‘donor’ city to the State of Connecticut.

  2. I am not sure if “money in, money out” is an accurate way to quantify if an unfair distribution of Federal Funds exists. Could the underlying basis for comparison be skewed, due to the enormous amount of outbound FICA and Capital Gains Taxes generated by the Gold Coast in our State of Connecticut. It may be this disparity in wealth and income levels that exacerbates this persspective.

  3. We giveth, we don’t getth. Talk all you want about the Gold Coast, that’s not the entirety Perhaps we have to have representation that is concerned about our economy rather than being bent on photo ops and taking down politicians they don’t like. In other words, how about representing us in the form of improving our state economy – infrastructure grants from the Fed to avoid those tolls would be a nice place to start…

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