Thomas Robinson

14 Most Federally Dependent States And The 6 Least, Including Their Political Leanings

For those curious souls, itching to uncover the federal reliance of US states, read on. This article provides an examination of the varying degrees of federal dependency among different states in the U.S. The analysis spans political affiliations, funding sources, and key areas of allocation.

New Mexico

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New Mexico relies significantly on federal funding to support various aspects of its budget. The federal dollars allocated to the state are often directed towards essential areas such as education and infrastructure. New Mexico is a light blue state.

Alaska

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Alaska is a red state in terms of its political leanings. It is considered one of the most federally dependent states in the United States. Its relatively small population is accompanied by a significant presence of federal jobs and a notable share of federal grants. 

Mississippi

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Mississippi, a state with Republican leadership, has a significant reliance on federal funds. Approximately 45% of the state’s budget is sourced from federal money, with a substantial portion allocated to Medicaid. This heavy dependence on federal funding is reflected in the fact that for every dollar paid in taxes by a Mississippi resident, the state receives approximately $2.73 back in federal funding. 

Kentucky

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Kentucky, a traditionally red state, receives substantial federal funds, particularly for education, infrastructure, and healthcare. The state benefits from federal assistance to support various programs and initiatives aimed at enhancing public services and addressing community needs. However, Kentucky ranks relatively low in terms of federal jobs.

West Virginia

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According to SmartAsset, “No state is more dependent on the federal government than West Virginia, which gets 45.16% of its revenue from federal sources (the 10th-most). West Virginia receives 2.36-times more revenue from the federal government than its residents pay in income taxes, the third-highest ratio across our study.” West Virginia is now a heavily republican state. 

Montana

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Montana, a traditionally “deep-red” state, receives approximately $1.47 in federal funding for each dollar it contributes. Much of this funding is allocated to support Medicaid and other Department of Public Health programs in Montana, highlighting the role of federal assistance in providing essential healthcare services to residents. 

Arizona

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Arizona is often considered a state with a significant reliance on federal funding. Arizona, like many states, receives federal funds to support various programs and services such as healthcare, education, infrastructure, and more. Arizona is now a politically blue state, having been red in the past.

Indiana

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Federal funds make up approximately 40% of Indiana’s annual budget. The state relies significantly on federal dollars to support various programs and services, with a notable portion allocated to programs like Medicaid and government-run offices, including the Department of Child Services. Politically, Indiana has a strong Republican preference. 

South Carolina

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According to WalletHub, South Carolina ranks first in the amount spent per resident compared to what each resident pays in federal taxes. Furthermore, residents of South Carolina receive approximately $4.51 for every dollar they contribute in federal taxes. According to Forbes, South Carolina, long seen as a red state, is now becoming a more conservative state.

Louisiana

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Louisiana has been a red state consecutively since 2000. The state relies significantly on federal funding, with half of its state budget coming from the federal government.

Alabama

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SmartAsset states that “Alabama has a 1.11 ratio of federal funding to income taxes paid, the eighth-highest for this metric in the study. The ratio of pay for government workers to private for-profit workers is 1.95, the fifth-highest overall. And the state also has the 10th-highest percentage of workers employed by the federal government, at 3.38%.” Alabama is generally considered a Republican stronghold, and has historically been a reliably Republican state in national elections. 

Wyoming

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Wyoming, a red state, has one of the lowest citizen tax burdens in the country and benefits from a substantial amount of federal funding. This federal cash infusion is often directed toward staffing and services in national parks, reflecting the state’s rich natural landscapes and the presence of significant federal lands.

Maine

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With a left political leaning, Maine receives substantial federal dollars, amounting to just over 43% of the state’s yearly budget. This federal funding contributes to crucial areas such as infrastructure development, public safety initiatives, and healthcare programs.

Tennessee

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Knox News. suggests that “Tennessee’s state government is the third most-dependent state on federal funding, a figure derived from the proportion of state revenue that comes from the federal government in the form of intergovernmental aid. It also estimates Tennessee residents are the 20th most-dependent on federal aid, which was calculated by dividing federal funding to state’s residents by IRS collections from state residents.” In addition, Tennessee is regarded as a safe red state. 

The Least Federally Dependent States: Minnesota

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Minnesota, generally a blue state, is considered one of the least dependent states on federal support in the United States. Residents of Minnesota contribute more in taxes to the federal government than they receive in direct support.

New Jersey

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Findings from WalletHub suggest that New Jersey residents and the state government rank low in terms of dependency on the federal government. According to the study, New Jersey residents rank 49 out of 50 for dependency, and the state government ranks 44 in dependency. For the last eight elections, New Jersey has voted demographic. 

Delaware

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Delaware is often considered one of the states with a relatively high income and economic activity and has a diverse economy. While it may receive federal funds, the degree of dependency on federal support is not as significant as other states. Delaware has voted Democratic for the last seven elections. 

Illinois

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A 2022 study by citybiz ranked Illinois as the sixth least federally dependent state and has one of the highest tax rates in the nation. Since 1992, the state of Illinois has voted Democratic. 

Kansas

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Politically red, Kansas is regarded as a federally independent state (WalletHub) and ranks as the third most federally independent state. This assessment takes into account both residents’ dependency (where Kansas ranks 37th) and the state government’s dependency (where Kansas ranks 47th). The rankings suggest that Kansas exhibits a relatively lower dependency on federal support compared to other states.

Massachusetts

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According to Boston.com, a new report found that Massachusetts not only has the highest GDP per capita in the country, but that it’s among the states least dependent on federal dollars. The state has been a Democratic stronghold for many years. 

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