Education Expenditures
An annual time series of state and local government expenditures produced by the U.S. Census Bureau goes back to fiscal year 1961, but the focus in Arizona Indicators is the period since the early 1990s. The data are reported for fiscal years; for example, fiscal year 2010 ran from July 1, 2009 through June 30, 2010. The latest data typically lag two-to-three years behind.
The government finance data are collected from a census of all governments in years ending in ‘2’ and ‘7.’ In the other years, information is collected from each state government and from a sample of local governments. Only “general” expenditures of state and local governments are collected; publicly run utilities, liquor stores, and insurance trust programs, such as employee retirement systems, are excluded.
Total expenditures are divided into two categories: capital outlays (for the construction of buildings and for the purchase of land and equipment) and noncapital expenditures (such as the compensation of employees and the purchase of supplies, materials, and contractual services). Capital outlays largely are made in response to a growing population and do not benefit other students, so the noncapital figure is the more meaningful measure.
In order to compare education expenditures in Arizona to those in other states, the expenditure data have been standardized in four ways: (1) per capita; (2) per $1,000 of personal income; (3) per student; and (4) per student per $1,000 of per capita personal income. Whenever student enrollment figures are available, the latter two measures are preferred. The adjustment for personal income allows for the effects of inflation and per capita economic growth to be considered. The fiscal year average (the average of the four quarters of the fiscal year) of personal income is used to standardize the expenditure data. Per capita personal income was calculated using the fiscal year average for personal income and the average of the population at the beginning and end of the fiscal year.
Expenditures are reported by the U.S. Department of Commerce, Census Bureau http://www.census.gov/govs/estimate/. Fall enrollment figures come from the Digest of Education Statistics, published annually by the U.S. Department of Education, National Center for Education Statistics http://nces.ed.gov/programs/digest/. Personal income is estimated quarterly by state by the U. S. Department of Commerce, Bureau of Economic Analysis http://www.bea.gov/regional/index.htm. Annual population estimates as of July 1 are produced by the U. S. Department of Commerce, Census Bureau. The estimates are released in December. The time series of population estimates is most easily accessed from the BEA: http://www.bea.gov/regional/index.htm.
The Census Bureau did not release state and local government finance data by state for fiscal years 2001 and 2003 and noncapital expenditures were not provided for fiscal year 1997; interpolated figures for these years are shown in the charts. In noncensus years, the Census Bureau data are subject to sampling error. In all years, the data are subject to misreporting by state and local governments and to misunderstandings between the Census Bureau and state and local governments regarding the differing accounting systems used.
Inconsistencies and inaccuracies exist within the time series of enrollment in elementary and secondary education.
Some of the inputs to the calculation of personal income by state are estimated. Personal income estimates are subject to revision. Personal income is a comprehensive measure of the economy but has conceptual limitations when employed to adjust public revenues and expenditures. The per capita figures are based on annual estimates of the population made by the Census Bureau that are subject to revision.
Noncapital Education Expenditures, Rank (1=Lowest Expenditures Among the States), Arizona State and Local Governments
Visualization Notes:
In fiscal year (FY) 2011, Arizona ranked near the bottom of the states on each of the four measures of funding for elementary and secondary education, lower than in the early 1990s when the state ranked below average. Funding for higher education in Arizona does not rank as low as K-12 education, but was below the median state on all four measures in FY 2011, including seventh lowest per full-time-equivalent student. Large increases in university tuition have kept the state’s spending from deteriorating more than it has.
Noncapital Education Expenditures, Percentage Difference from the National Average, Arizona State and Local Governments
Visualization Notes:
Per student K-12 education spending in Arizona in fiscal year (FY) 2011 was 34 percent below the national average; the figure per student per $1,000 of per capita personal income was 22 percent below average. On both measures, Arizona is much further below the national average than in FY 1993.
Per full-time-equivalent (FTE) student, higher education spending in Arizona in FY 2011 was 19 percent below the national average. However, per FTE student spending per $1,000 of per capita personal income was only 4 percent below average. On both measures, Arizona is further below the national average than in FY 1993.
Noncapital Education Expenditures as a Percentage of the National Average, Arizona State and Local Governments
Visualization Notes:
Per student K-12 spending in Arizona fell substantially relative to the national average between the early 1990s and fiscal year (FY) 2006 but has dropped only a little further since then. Higher education funding per full-time-equivalent student as a percentage of the national average did not trend down through FY 2006 as did K-12 spending, but dropped in FYs 2010 and 2011. Because of the Arizona’s low incomes, Arizona does not compare as unfavorably on education spending per student if the figure is adjusted for per capita personal income, but the change over time is similar regardless of whether the adjustment for income is made.
Data Source
Expenditures are reported by the U.S. Department of Commerce, Census Bureau http://www.census.gov/govs/estimate/. Fall enrollment figures come from the Digest of Education Statistics, published annually by the U.S. Department of Education, National Center for Education Statistics http://nces.ed.gov/programs/digest/. Personal income is estimated quarterly by state by the U. S. Department of Commerce, Bureau of Economic Analysis http://www.bea.gov/regional/index.htm. Annual population estimates as of July 1 are produced by the U. S. Department of Commerce, Census Bureau. The estimates are released in December. The time series of population estimates is most easily accessed from the BEA: http://www.bea.gov/regional/index.htm.
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