PA Reliance on Fed $'s Part of National Trend

Pennsylvania wasn’t alone in relying on increased federal support to balance its budget and pay out unemployment compensation over the last few years.
Pennsylvania balanced its last two budgets, in part, with billions of federal stimulus dollars.
The state also borrowed heavily from the federal government to make up for a shortfall in its unemployment compensation fund.
The report by the Census Bureau shows state revenue dropped 30 percent in 2009.
Cheryl Lee of the Census Bureau says the bulk of losses were the result of the decline in the stock market, which hurt social trust funds set up to pay for pension programs, unemployment compensation and other safety nets.

"This is looking at the unrealized gains and losses on these investments in this area. It’s not that it’s actually money changing hands. It’s really literally money that’s still in the market, but it hasn’t really gone anywhere."

Numbers compiled by the Census Bureau show federal grants to states increased 13 percent in 2009, and made up nearly a third of states’ revenue.
Lee says nearly sixty percent of the federal money was directed to welfare programs.

"Those grants were there as really – had to make sure those programs were maintained. I mean really there wasn’t much choice, or else there would be major problems being able to help the people that needed them."

If you take out the social trust fund dive, nationwide state revenue only dipped about one point five percent.