Alaskans receive among highest federal paybacks

Unusually high number of dollars given to city, state governments in Alaska

Posted: Friday, August 15, 2003

FAIRBANKS - For every tax dollar the federal government collected from Alaska in fiscal 2002, it spent $1.91 in the state, according to an estimate by a tax watchdog group.

That's 65 cents more than returns in 1992 - the largest increase among all states, the Tax Foundation said in its annual analysis of federal tax burdens and expenditures.

The increase didn't put Alaska at the top of the list, though. First in the country is New Mexico, with $2.37, followed by North Dakota, with $2.07.

New Jersey gets the lowest return on its federal taxes, at 62 cents per dollar.

Scott Moody, the foundation's senior economist, said Alaska ranks near the list's top because of a proportionately large number of federal employees and an unusually high number of dollars granted to the state and local governments.

A large number of federal employees usually reflects large military bases, Moody said. That's a characteristic Alaska shares with New Mexico.

The abundant grants to Alaska's state and local governments are harder to explain, Moody noted, but Sen. Ted Stevens is likely one reason. The Republican senator is chairman of the Senate Appropriations Committee, a post he first gained in 1997.

"Oftentimes I don't like to pin it on one person, but in Alaska's case that might be part of it," Moody told the Fairbanks Daily News-Miner.

The state's ratio of money sent versus money spent also rose because of falling income levels in Alaska.

With lower incomes, Alaskans are paying fewer taxes compared to other states.

While Alaska didn't quite top New Mexico and North Dakota in the ratio of money spent to money sent, it had the highest per capita rate of federal spending in 2002.

The federal government spent $11,540 per Alaskan in 2002, the foundation found. North Dakota was next at $10,090 per capita, followed by Virginia at $9,996.

Moody said the report isn't designed to highlight "pork-barrel" spending by politicians.

"We don't really say whether that's a good or bad thing. That's going to depend on your political orientation," he said. The intent is tell politicians how taxes may be affecting their constituents, he said.

Nationwide, the per-capita federal tax burden has grown steadily over the past few decades, even when adjusted to inflation, according to the Tax Foundation. The national average was $6,326 in 2002 for every man, woman and child.

Those figures include all federal taxes - income, Social Security, corporate and excise, as well as customs duties. The foundation wraps corporate and excise taxes into the mix to calculate the national "tax burden" on individuals because it figures people end up paying the taxes one way or another.



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