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Research Publication No. 3
Foreword
Not many years ago some critics of the American scene were predicting the end of state government in the United States, as obsolete to the American political system. Not only have these predictions failed to materialize, but the states have vastly increased the scope of their services, their personnel and payrolls, their holdings of physical wealth, and their influence over local government activity. State expenditures since World War II have grown at the rate of 10 percent a year, well in excess of the rate of gain in the national economy, and now total more than $45 billion annually.
Both the present cost of state government and its projected further rise focus interest on the methodology in decision-making on state expenditures. Who makes spending decisions? What are the relative roles of the legislative and the executive branches? What control devices are applied to insure that spending is kept within prescribed limits and conforms to the purposes for which it is authorized?
This study examines the pattern of spending procedures in the 50 states at all phases of the budget cycle—from the time budgets are drafted through the expenditure authorization, budget execution, and final review or post-auditA tax audit is when the Internal Revenue Service (IRS) conducts a formal investigation of financial information to verify an individual or corporation has accurately reported and paid their taxes. Selection can be at random, or due to unusual deductions or income reported on a tax return. . The study describes procedures now in effect, points up major problems, and indicates how some states are attempting to improve their control methods. In many ways, it is a companion volume to a similar study, Controlling Federal Expenditures, published by the Foundation in December 1963.
Acknowledgement is due scores of individuals and groups who furnished basic information and assistance. Special thanks are due cooperating organizations in the 50 states. They supplied answers to the questionnaires forming the nucleus of this study, including factual information on procedures and their opinions as to the efficacy of existing methods of state expenditure control.
These groups included state taxA tax is a mandatory payment or charge collected by local, state, and national governments from individuals or businesses to cover the costs of general government services, goods, and activities.
payer organizations, administrative and legislative officials in the state governments, state chambers of commerce, and members
of university faculties. Robert W. Schleck, Senior Research Analyst, was primarily responsible for the research and preparation of this study.
The Tax Foundation is a private, non-profit organization founded in 1937 to engage in non-partisan research and public education on the fiscal and management aspects of government. Its purpose, characterized by the motto “Toward Better government through Citizen Understanding,” is to aid in the development of more efficient and economical government. It serves as a national information agency for individuals and organizations concerned with problems of government expenditures, taxation, and debt.
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