Michigan Expenditures and Revenues: Comparisons with Other States, FY 1987-88

The exhibits in this report include FY 1987-88 data for the United States, Michigan, and ten other selected states. The rank among the fifty states (and the District of Columbia for the state and local data) is included for Michigan and the highest and lowest ranking states for each category. (The rank appears in parentheses next to the state's name.) State-Local Expenditures State-local spending in Michigan remains above the U.S. average whether measured per capita or per $1,000 of personal income. Using the per capita measure, Michigan is 5.4 percent above the U.S. average (down from 7.8 percent in FY 1986-87); using the personal income measure, Michigan is 9.3 percent above the U.S. average (up from 6.4 percent). (See exhibits 1 and 2.) Michigan continues to rank high in spending for education, welfare, and health and hospitals, and low in spending for highways and interest on debt. (See exhibits 3 to 12.) Growth in per capita state-local spending for FY 1987-88 was greater than in recent years in all categories except interest on state debt, which fell by 1.3 percent. Michigan's state-local per capita spending on health and hospitals rose by 10.1 percent, on education by 9.6 percent, on highways by 5.6 percent, and on welfare by 3 percent. (The previous year's rates of increase ranged from 2.2 to 3.2 percent except for the debt category, where spending rose by 11.7 percent.) Although the increase in per capita educational expenditures was significant enough to raise its rank from 7th to 3d among the states (and the District of Columbia), the rise in per capita spending on highways was not enough to prevent the state's rank in this expenditure category to fall from 41st to 45th. The level of per capita educational expenditures was 22.5 percent above the U.S average, while the per capita spending level for highways was 21.2 percent below the national average. Changes in state-local expenditures per $1,000 of personal income were smaller than the per capita increases, primarily due to the strength of the economy during the 1987-88 fiscal year relative to the slow growth in spending. State-local expenditures per $1,000 of personal income fell in the debt and welfare categories (by 5.7 percent and 1.3 percent, respectively) and increased in the categories of health and hospitals (5.5 percent), education (4.8 percent), and highways (1.1 percent). State-Local Revenue L The Michigan tax burden is relatively high in per capita terms and above average when measured per $1,000 of personal income. Both measures are 5 percent above the U.S. average using the per capita