States' Capital Spending Climbs 8% in Fiscal 2019
Thanks in part to a strong increase in transportation spending, states’ total capital expenditures, including infrastructure funding, rose 7.7% in fiscal year 2019, to an estimated $113.9 billion, a new National Association of State Budget Officers report says.
The budget officers' group says that the 7.7% annual increase in capital spending is the third-highest percentage gain over the past 20 years.
The capital expenditures come from a mix of sources. States' cash resources provided 46% in 2019, bonds accounted for 27.1% and federal funds 26.8%
NASBO says that transportation, the largest capital-expenditures category, climbed by 9.3% in fiscal 2019, to $73.1 billion. The $6.2-billion upturn is the largest in dollar volume among all capital categories.
Transportation’s 2019 capital spending gain follows a 2.8% downturn for that segment in 2018. NASBO points out that capital spending can vary from year to year, because of project delays and the multi-year nature of construction projects. But it notes that transportation capital expenditures have posted an annual average gain of 4.9% since 2010.
NASBO traces the states' 2019 transportation increases to their “efforts at addressing both the maintenance and expansion of [their] transportation systems with tax and revenue actions to raise funds.”
The report also says that since 2013, 33 states have acted to increase fuel-tax revenue.
The report notes that actual transportation capital-type spending could be higher than $73 billion, because a dozen states treat outlays on building and maintaining roads, bridges and transit differently from their other capital spending types.
Overall transpotation capital and operating-budget expenditures were up 8.9% in 2019 to an estimated $171.9 billion, the report shows.
Capital expenditures on higher education—states’ second-largest capital line-item—increased an estimated 2.4%, to $12.1 billion in fiscal 2019.
Capital spending on prisons and other corrections projects climbed 5.7%, to $1.2 billion; housing was up 13.4%, to $1.3 billion.
But environmental capital spending, including drinking-water, wastewater treatment, environmental cleanup and other project types, dipped 5.6%, to $6.4 billion, according to the report.
The “all-other” category—which included such items as parks, behavioral hospitals, community development projects and information technology systems —posted the largest percentage gain, 13.5%, to $17.2 billion.
Among the states, Florida ranks first in total capital expenditures, with an estimated $13.5 billion for 2019. New York is second, at $12.3 billion, the report shows.
Texas ranks third, with $10.9 billion; followed by New Jersey at $6.3 billion; and California at $5.5 billion.
Overall state spending increased 5.7% in 2019, to a estimated $2.1 trillion—exceeding the $2-trillion level for the first time, according to NASBO.
Headline corrected on 11/22/19 to show increase of 8% in capital spending. Percentage increases corrected on 11/25/19 for housing and "all-other" categories of capital spending