1. 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?

2. 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?

3. [ 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.

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

5. 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?

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

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

8. 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?

9. 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?

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

11. 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?

12. 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

13. 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.

14. 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.

15. 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

16. 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