State and Local Public Finance Methodology

How the FinObservatory state-and-local public-finance layer is built: the two primary sources, the units and definitions that govern every number, the vintage that fixes the detailed spine, and every stated caveat. This page is the single source of truth for the module; the page numbers are all computed at build time from the functions in src/lib/publicFinance.ts, never typed by hand.

Sources

Two publishers, both primary, both free.

U.S. Census Bureau, Annual Survey of State and Local Government Finances. The spine. Revenue by source, expenditure by function, and debt outstanding for state and local governments, published as the State and Local Government Finance tables. The module reads the combined state-and-local summary table (Table 1) from the 2022 Census of Governments, the most recent year for which the Census publishes a ready combined summary table. Census data are in the public domain (17 U.S.C. section 105). Dollar amounts in this source are in thousands of US dollars.

Federal Reserve Board, Financial Accounts of the United States (Z.1). The state-and-local-government sector's credit-market debt, served through the St. Louis Fed's FRED. Two series, both in millions of US dollars:

• SLGSDODNS, State and Local Governments; Debt Securities and Loans; Liability, Level (quarterly, seasonally adjusted). The broad credit-market measure plotted on the page.
• SLGMSOA027N, State and Local Governments; Municipal Securities; Liability, Level (annual, end of period). The narrower "municipal securities" line.

What "combined state and local" means

The Census reports each figure three ways: state and local combined, state only, and local only. The combined column removes duplicative intergovernmental transactions, chiefly state aid paid to local governments (mostly for schools). Because those transfers are counted once in the combined column and twice when the state and local columns are added, the two levels summed always exceed the combined total. In FY2022 that gap is $682.7 billion, which is exactly the sum of state-to-local aid ($662.3 billion) and local-to-state payments ($20.4 billion) that the combined column nets out. The module uses the combined column for every headline and breakdown, and shows the state and local totals only where they are compared directly.

Definitions

• Total revenue includes general revenue, utility revenue, liquor-store revenue, and insurance-trust revenue (employee-retirement, unemployment, and workers'-compensation systems). General revenue excludes the utility, liquor-store, and insurance-trust accounts.
• Taxes are own-source: property, general and selective sales, individual and corporate income, motor-vehicle license, and other taxes. Intergovernmental aid from the federal government is reported separately, not as a tax.
• Direct general expenditure by function is the classic spending breakdown (education, public welfare, hospitals, health, highways, police, and so on). Utility, liquor-store, and insurance-trust expenditure sit outside it and are reported separately in the source.
• Debt outstanding is the amount owed at year end, split into short-term (maturity of one year or less at issue) and long-term. Long-term debt issued and retired during the year are flows, not the year-end stock.

Vintage

The detailed revenue, expenditure, and debt breakdown is fiscal year 2022, from the 2022 Census of Governments (released October 31, 2024). Census-of-Governments years (ending in 2 and 7) are a complete enumeration; intervening years are a sample survey. The 2023 and 2024 rounds are currently published only as individual-unit microdata and a national "First Look," without a ready combined summary table, so 2022 remains the latest year with a published combined table. The Federal Reserve Z.1 series extend to the latest published quarter and update each Z.1 release.

No municipal-yield series

The module deliberately shows no municipal bond yield or index. The widely cited muni-yield benchmarks (the Bond Buyer indices, S&P Municipal Bond indices, and the ICE and Bloomberg families) are proprietary and license-restricted; the Bond Buyer 20-Bond GO index on FRED is discontinued. No license-clean, freely redistributable municipal-yield series was available at build time, so none is shown rather than showing a restricted or stale one.

Caveats

• Sample-year figures carry sampling error; the Census publishes coefficients of variation and response-rate documentation alongside each table. The 2022 data used here are a complete census, not a sample.
• Revenue exceeding expenditure on this accounting does not mean free operating cash. Much of the difference is contributions flowing into employee-retirement and other insurance-trust funds, which are assets held for future benefits, not spendable surplus.
• The count of roughly 90,000 local governments is the Census of Governments organization count; not every unit files finance data every year.