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Day 10 - "One-time" expenditures and government growth

How fast is state government growing? Our calculations show that state government expenditures are growing very rapidly. The Utah Senate Majority blog says government employment is growing slower than overall employment growth. So who's right?

Government expenditure growth
We released a report recently that showed state government expenditures are growing at a very high rate. Here is a very brief summary of annualized education/general fund expenditure growth, including earmarks:

FY07 to FY08: . 14.8%
FY06 to FY07: . 21.8%
FY05 to FY06: . . 7.6%
FY04 to FY05: . 11.2%
FY01 to FY08: . . 7.1% (annualized, includes 3 years of recession)
FY93 to FY08: . . 7.7%

Click [here] to view the report.

Government employee growth
The Utah Senate Majority blog states that state government employment grew slower (1.88%) than total Utah job growth (4.7%) during the December 2005 to December 2006 time period. This is interesting information, but using this data to argue that government is not growing very fast presents several problems.

- The cited data points cover a very short time period (one year). Government and private sector job growth for FY07 and FY08 are not currently known.

- Government employee growth is not the bottom-line measure for government growth, although it is an important statistic to track. The bottom-line measure for government growth is expenditure growth, which our report shows to be very high.

So-called "one-time" capital expenditures
Tracking government employee growth doesn't tell the whole picture because it does not adequately capture growth in capital projects such as roads and buildings. Spending hundreds of millions of dollars on new roads does not lead to huge increases in the number of government employees, but capital expenditures are still tax dollars. In Governor Huntsman's proposed 2008 budget, more than $900 million in ongoing and one-time cash is being proposed for roads and buildings.

Sometimes, these capital projects are dismissed as being one-time projects and should not be counted when determining government expenditure growth. However, there are two HUGE problems with this type of thinking:

- So-called one-time expenditures are still tax dollars

- These projects, particularly roads, are NOT one-time expenditures, at least not from a long-term structural perspective. The state anticipates spending hundreds of millions of dollars annually on roads for the next several decades.