Members of Congress from the Northeast-Midwest region created the Northeast-Midwest Congressional and Senate Coalitions in order to work together on policies that would target federal resources and programs to address the economic challenges facing the region. Their 18 states send more tax dollars to the federal government than any other region of the country, yet receive less in terms of the federal government’s spending.

The Northeast-Midwest Institute was established to research and provide recommendations on public policy initiatives that would address resources to the challenges in the region.

The states in the Northeast-Midwest can ill afford to continue subsidizing economic vitality in other regions of the country when so many of their cities and towns are struggling with a legacy of aging infrastructure, loss of manufacturing capability, population loss, and the need to address environmental remediation. In order to assess progress toward a more equitable distribution of federal funds, the Northeast-Midwest Institute tracks the funding levels of a broad array of programs critical to the region and analyzes their impact. The Institute:

• Provides a same-day analysis of the president’s budget request, including a description of key programs and an analysis of long-term funding trends of programs critical to the region;
• Tracks the results of House and Senate committee and floor action on appropriations of relevant federal programs;
• Provides more detailed appropriations tracking for policy areas of special interest, such as watersheds; and
• Provides in-depth, detailed analysis of federal spending in the 18 states in the Northeast and Midwest for dues-paying members.

One of the Institute’s goals is to help the states in the region reduce the extent to which they subsidize programs designed to help other regions of the country, particularly when so many of the cities and states in the Northeast and Midwest are struggling with lagging economies. Recent research conducted by the Brookings Institution, for example, found that fully two-thirds of all struggling metropolitan areas in the United States are in the region. Among smaller cities, 77 percent are in the Northeast and Midwest.

The Institute compiles information on federal program funding levels to provide members of Congress information on programs of particular importance to the region. This information includes historical levels of federal funding received by states in the Northeast and Midwest so that public officials can track progress in increasing the flow of federal funds to their states, provides information on allocation formulas used to target the funds that determine the amount of funding states or locales receive, and provides information on programs from which states in the region do not currently receive federal funding.

The Northeast-Midwest Congressional and Senate Coalitions actively pursue opportunities to increase the appropriations of targeted programs important to the region. Similarly, they seek to establish federal programs responsive to the economic and social challenges facing the region and its residents. (See Revitalizing Older Cities Initiative).

Federal Spending

Flow of Federal Funds to States

Federal Spending in the Northeast-Midwest Region

The Northeast-Midwest Institute and the Northeast-Midwest Congressional and Senate Coalitions have tracked and analyzed federal spending and taxation patterns since their founding in the mid-1970s. Most states in the Northeast and Midwest contribute more in taxes to the federal government than they receive back in federal spending, which means the Northeast-Midwest region subsidizes federal spending in the rest of the country. The factors driving the Northeast-Midwest's low return on each federal tax dollar vary within the region. In the Northeast as a whole, higher than average per capita taxation yields a low return on each federal tax dollar despite relatively high levels of federal spending. In the Midwest, the low return on each federal tax dollar stems from relatively low levels of federal spending.

Factors that Influence Federal Spending

The consistency of federal spending, taxation, and return on federal dollar trends over time points to the stubborn nature of what determines the federal balance of payments for a state or region. An elected official has limited control over the flow of federal funds into and out of a state, and little opportunity to spur dramatic changes from one year to the next. Factors that influence federal spending and taxation patterns include the following:

• Demographics – a state's share of residents aged 65 or older and under 18 helps determine spending levels for many federal programs designed to assist the elderly and children.
• Economic well-being – high poverty rates and low income levels in a state increase the likelihood of federal spending on assistance programs, while high incomes reduce the likelihood of such federal spending and increase the federal tax burden.
• Industry mix – a concentration of defense industries boosts federal procurement dollars, and a concentration of farming increases federal expenditures for agricultural assistance.
• Federal facilities – the location of federal facilities determines state-by-state federal spending on employee benefits, wages, and salaries, among other items.
• Emergency situations – targeted federal spending helps offset the impact of unexpected and adverse developments, including natural disasters and human catastrophes.

Reports

• Northeast-Midwest Guide to Federal Formula Grant Programs
  The grants guide provides basic information and useful data about each of the 50 largest federal formula grant programs to state and local governments. (To see a list of the programs featured in the grants guide, click here) In addition, the guide provides separate reports and data about how each of the 18 Northeast-Midwest states fares for 158 federal formula grant programs. After downloading, use the grants guide table of contents to locate programs or states of interest.
• The Northeast-Midwest Regional Budget Analysis for Fiscal Year 2009
• Annual Tables for Flow of Federal Funds to the States—The Northeast-Midwest Institute supplies contributing states and Northeast-Midwest Coalition members with detailed, state-specific data on the flow of federal funds. That full report, not available online, includes state-specific amounts and comparative statistics for every federal program included in the Consolidated Federal Funds Report. For information about contributing to the Northeast-Midwest Organizations, contact Joanna Stover at  202-464-4003 .

Other Federal Spending Tables

• Low Income Home Energy Assistance Program (LIHEAP)
• Weatherization Assistance Program Allocation (FY2009)
• LIHEAP Requests, Authorizations, and Appropriations (1982-2007)

Archives

• Defense Department Base Closing Plan Would Disproportionately Affect the Northeast-Midwest Region (May 2005)
• Base Closings and Military Presence in the Northeast-Midwest: The Nation’s Unguarded Region (April 2005)
• 50-State Tables on Levels and Changes in U.S. Military Personnel
• Defense Spending in the Northeast and Midwest: Fiscal 2000
• 25 Years in the Northeast-Midwest
• Regional Analysis of the President’s Fiscal Year 2005 Budget
• Regional Analysis of the President’s Fiscal Year 2006 Budget
• Regional Analysis of the President’s Fiscal Year 2007 Budget (None Produced)
• Regional Analysis of the President’s Fiscal Year 2008 Budget
• Fiscal Year 2011 Appropriations Summary
• Fiscal Year 2010 Appropriations Summary
• Fiscal Year 2009 Appropriations Summary
• Fiscal Year 2008 Appropriations Summary
• Fiscal Year 2007 Appropriations Summary
• Fiscal Year 2006 Appropriations Summary
• Fiscal Year 2005 Appropriations Summary
• Fiscal Year 2004 Appropriations Summary