Balance of payments is the amount of revenue paid to the federal government from a state’s residents and economy (taxes) minus the amount of federal spending in that state. Donor states pay more to the federal government in taxes than they receive back in funding.
There are currently eight U.S. states that are considered donor states. The main reason that these states see a negative balance is because they have some of the highest household incomes in the country, paying more to federal taxes. This, however, does not guarantee that they would receive more federal funding for things such as Medicaid and education.
New York is the largest donor state in the U.S., with a negative balance of payments at $22,798,000,000. For every dollar New York gives the federal government, its residents are only receiving $0.91 back.
Seven other states are donor states:
- New Jersey (-$10,334,000,000)
- Massachusetts (-$9,919,000,000)
- California (-$6,653,000,000)
- Connecticut ($5,754,000,000)
- Minnesota (-$1,896,000,000)
- Colorado ($1,374,000,000)
- Utah (-$416,000,000)
Virginia is at the opposite end of the spectrum, with the highest positive balance of payments. Virginia’s balance of payments is $111,785,000,000, and residents receive $2.24 for every dollar sent to the federal government. Kentucky follows with $63,229,000,000 and the highest expenditure per dollar of receipts at $2.89.
The ten states with the largest positive balance of payments (the biggest takers) are: