Tax Levy Financing for Public Health: The Moderating Influence of Long-Term Debt J. Mac McCullough, PhD, MPH Assistant Professor School for the Science of Health Care Delivery Arizona State University

Co-Authors JP Leider, PhD Senior Research and Evaluation Officer de Beaumont Foundation William Riley, PhD Professor School for the Science Health Care Delivery Arizona State University

Introduction & Motivation Local expenditures are often evaluated relative to non-local expenditures (e.g., % of expenditures from local sources) A more informative comparison is an area’s local expenditures for public health relative to other non-public health expenditures Local government financial characteristics—such as debt burden—may be especially relevant Local sources of expenditures are important for LHD financial stability and may reflect local prioritization of public health relative to other programs

Methods Data sources: Local governmental revenue data from U.S. Census of Local Governments (2007) Contains geographic and financial data on 87,000 local governments (cities, counties, school districts, special districts, etc.) LHD data from NACCHO Profile survey (2008) Matched using FIPS codes 2,332 NACCHO respondents  Matched  Excluded LHDs with missing/unreliable expenditure data  Final sample = 1,506 LHDs Outcome of interest: Fiscal Allocation = (Total LHD Local Expenditures) ÷ (Total Local taxes for corresponding local governments) Local taxes include: property taxes, other collected taxes, fees, fines Univariate, bivariate, multivariate analyses, accounting for state-level impact (random effect model) Models stratified by level of long-term debt

Results Fiscal allocation varies widely across LHDs Large number of LHDs receive no fiscal allocation Small number of LHDs receive substantial fiscal allocation Substantial state-level variation

Correlates of Fiscal Allocation LHD or Area Characteristic Association with Fiscal Allocation Single-county LHD jurisdiction (versus all other jurisdiction types) Single county jurisdiction  0.80 percentage point higher Fiscal Allocation LHD has a Local Board of Health (versus no LBOH) LBOH  1.79 percentage point higher Fiscal Allocation LHD per capita revenues (standardized) ~$40 increase of per cap revenues  2.38 percentage point higher Fiscal Allocation # of Services Provided by LHD 1 additional service provided  0.09 percentage point higher Fiscal Allocation Variables not significant in model: Setting (urban, suburban, rural), % of population that is Non-White, LHD authority to set and impose fees for public health, LHD authority to impose taxes for public health, LHD authority to request tax levy for public health, number of services provided by state, number of services provided by other local government, number of services not available in area Estimates correspond to the predicted percentage point change in fiscal allocation for presence or one-unit increase for each factor

Long-Term Debt & Fiscal Allocation Models stratified by long-term debt revealed notably different patterns “High” = long-term debt > annual tax revenues “Low” = long-term debt < annual tax revenues Findings: LBOH only associated with increased fiscal allocation in low-debt settings Authority to impose taxes for PH only associated with increased fiscal allocation in high-debt settings Low-debt: ↑ fiscal allocation with ↑ LHD service provision High-debt: ↓ fiscal allocation with ↑ state service provision

Implications & Next Steps

Fiscal Allocation for LHDs Fiscal allocation for public health averages approximately 3.3% of all local governmental “own revenues” High variation within and between states A range of factors are associated with levels of fiscal allocation for public health LHD jurisdiction type, governance, expenditures, service provision Some are amenable to LHD leadership intervention (e.g., service provision), others are harder to impact New waves of data will enable examination of trends-over-time

Impacts of Long-Term Debt on LHDs Anecdotally, we generally understand that very high levels of long-term debt is bad Less room for other priorities Less flexibility to match current needs Public health is not immune  An area’s long-term debt level is extremely important High long-term debt is associated with lower fiscal allocation for public health Only know which levers are relevant/effective after considering long-term debt Low-debt: Per capita expenditures, jurisdiction type (single county), LBOH, LHD service provision High-debt: Per capita expenditures, authority to impose taxes for public health, state service provision Take Away Researchers: consider additional measures/factors beyond per capita revenue Policy Makers: what local tax and debt conditions are most conducive to advocacy for increased funding?