The flow of state funds in New York

by E.J. McMahon |  | NY Torch

New York’s state revenues are disproportionately generated in New York City and its suburbs, resulting in a net transfer of income to upstate, according to a report issued today by the Nelson A. Rockefeller Institute of Government.  Meanwhile, a study by the Independent Budget Office (IBO) shows that “tax effort” is also highest downstate, especially in the city.

Both reports were released and discussed this morning at a conference in Manhattan co-sponsored by the the Rockefeller Institute, IBO and the Citizens Budget Commission.

The estimate of total revenues generated by each region differs depending on whether revenue is traced to residents of the regions, or to people working within the regions, including the commuters who generated much of the state taxes coming out of New York City.  Based on numbers in the first two tables of the Rockefeller Institute report, I came up with this way of illustrating the findings:

New York City comes closest to breaking even on the flow of funds.  Not surprising, the Capital Region gains the most from the flow of funds, followed by the rest of upstate New York.  Residents of downstate suburbs are effectively providing a very large net subsidy to upstate.



- E.J. McMahon is the Research Director at the Empire Center for Public Policy.