Budgeting at the State Level You and your family are thinking about colleges. Which one offers the courses you want? How much does it cost? During your research, you find that colleges within your state’s university system are far less expensive than private schools. Why is this?

State Spending Categories Each row in the table gives data about institutions in the same state. Why do you think public institutions cost more for out-of-state students while private ones do not?

[ 8.4 ] State and Local Taxes and Spending Learning Objectives Explain how states use a budget to plan spending. Examine the major categories of state spending. Identify the types and economic importance of state taxes. Describe local government, and the types and economic importance of local taxes.

Budgeting at the State Level Operating Budgets Capital Budgets Balancing State Budgets

Budgeting at the State Level Changes in state budgets tend to reflect changes in the national economy. What can you infer about the national economy in the years 1981–1983 and 2007–2010?

State Spending Categories Education Public Safety Transportation Health and Welfare Arts and Recreation Administration

Revenue for State Budgets Sales and Excise Taxes Individual Income Tax Corporate Income Tax Other State Taxes

Revenue for State Budgets This graph shows the ways that the states, collectively, get their revenues. What is the most significant source of tax revenue at the state level?

Revenue for State Budgets State individual income tax rates vary greatly. Some states have no income tax. In which range does the largest number of states set their top individual income tax rate?

Local Government Spending and Revenue Forms of Local Government The Jobs of Local Government Property Tax Other Local Taxes

Local Government Spending and Revenue Local governments supply a variety of services to many different people. Based on this graph, what do you think is the largest priority of local governments?

Quiz: Budgeting at the State Level Which of the following items would you expect to find in a state’s operating budget as opposed to its capital budget? A. the major expansion of port facility B. the construction of a sports stadium C. the painting of lines on a road D. the building of a science center

Quiz: Local Government Spending and Revenue The main local tax source of funding for public schools is A. the sales tax. B. hotel taxes. C. property taxes. D. meal taxes.

Quiz: Local Government Spending and Revenue What kind of taxes pay for fire departments? A. the sales tax. B. hotel taxes. C. property taxes. D. meal taxes.

Quiz: Local Government Spending and Revenue What pays for highway construction? A. Federal taxes B. State taxes C. Both federal and state taxes D. Local taxes

Quiz: Local Government Spending and Revenue What pays for a town’s sewer and water services? A. Federal taxes B. State taxes C. Both federal and state taxes D. Local taxes