Chris Christie
Chris Christie
stated on October 30, 2012 in an interview on NBC Nightly News:

Says New Jersey is “50th in return of our federal tax dollars.”

Mostly True
By Erin O'Neill
November 18, 2012

Chris Christie says New Jersey receives the smallest return of any state on the federal taxes it pays

New Jersey doesn’t just need a lot of federal aid to rebuild a coastline ravaged by Hurricane Sandy, the state also deserves it, according to Gov. Chris Christie.

NBC Nightly News host Brian Williams asked Christie recently if it’s fair for people who have no interests in the Jersey Shore to ask, “Why the money? Why the effort, if this is the new normal?”

“Well, listen, it’s fair to ask it but I have the answer,” Christie said during the Oct. 30 interview. “The answer is that for New Jersey, which gives so much to this country — by the way, 50th in return of our federal tax dollars. So New Jerseyans send more than any other state in America in federal taxes, getting back less. When that’s done and you see that our state is a state that needs this to contribute to our economy and also to the soul and the vibrancy of our state, I think we have very good answers and arguments to make. And you count on one thing: you’re looking at the guy who is going to make those arguments.”

With Christie building part of his case for federal assistance around the state’s return on federal tax dollars, PolitiFact New Jersey wondered whether his premise is true.

Add “Donor State” to the list of New Jersey’s monikers.

Depending on the year — and whether adjustments are made to federal data — New Jersey ranks at or near the bottom nationwide in this category.

The Tax Foundation, a business-backed group, tracked how much the federal government collected through taxes and returned through expenditures to states every year from 1981 to 2005.

The Washington, D.C.-based foundation calculated the federal tax burden — a measurement meant to account for taxes that are assessed in one state, but impact taxpayers elsewhere — to conduct its analysis.

In 17 of those 25 years, New Jersey came in last place, receiving 70 cents or less for every dollar it sent to the federal government.

In 2005 — the most recent year analyzed by the Tax Foundation — the federal government gave New Jersey 61 cents for every dollar it took. That was the smallest return of any state.

But that was seven years ago. Though the Tax Foundation hasn’t updated its findings, other studies show New Jersey still ranks near the bottom.

The Northeast-Midwest Institute, a research organization based in Washington, D.C., that promotes 18 states in the region, released a May 2011 report on federal spending and taxation patterns that focused on New Jersey.

New Jersey ranked 48th in the nation. Only Minnesota and Delaware received smaller returns on their federal tax dollars in 2009, according to the report, which relied on raw, unadjusted data.

PolitiFact New Jersey’s analysis of federal data from 2010 also put New Jersey in 48th place. So even the raw data put New Jersey near the bottom in this category.

But Colleen Cain, a senior policy analyst with the Northeast-Midwest Institute who prepared the 2011 report, said in an e-mail, that “the news behind this is not all bad.”

In the report, Cain attributes the low ranking to New Jersey’s “relatively high income levels and greater-than-average business income tax contribution, coupled with a relatively low need for federal aid.

It does, however, underscore the importance of states like New Jersey in supporting the fiscal health of the nation generally.”

Our ruling

Christie said that New Jersey is “50th in return of our federal tax dollars.”

The Tax Foundation’s analysis of 2005 data, which was adjusted to reflect each state’s overall federal tax burden, ranked New Jersey 50th in the nation in this category.

The state received 61 cents for every dollar it sent to Washington, D.C. that year.

Though that research is outdated, more recent analysis of raw data shows New Jersey still ranks near the bottom.

On the Truth-O-Meter, Christie’s statement registers as Mostly True.

To comment on this ruling, go to NJ.com.

Our Sources

NBC, Sandy hammers Jersey Shore, levels homes, shreds boardwalks, Oct. 30, 2012

Tax Foundation, Federal Taxes Paid vs. Federal Spending Received by State, 1981-2005, Oct. 19, 2007

Tax Foundation, Federal Tax Burdens and Expenditures by State, March 16, 2006

U.S. Census Bureau, Consolidated Federal Funds Reports for Fiscal Year 2006, issued April 2008

U.S. Census Bureau, Consolidated Federal Funds Reports for Fiscal Year 2007, issued September 2008

U.S. Census Bureau, Consolidated Federal Funds Reports for Fiscal Year 2008, issued July 2009

U.S. Census Bureau, Consolidated Federal Funds Reports for Fiscal Year 2009, issued August 2010

U.S. Census Bureau, Consolidated Federal Funds Reports for Fiscal Year 2010, issued September 2011

Internal Revenue Service, SOI Tax Stats - Gross Collections, by Type of Tax and State, Fiscal Year - IRS Data Book Table 5, accessed Nov. 13, 2012

E-mail interview with Colleen Cain, senior policy analyst with the Northeast-Midwest Institute, Nov. 14, 2012

E-mail interview with Michael Drewniak, spokesman for Gov. Chris Christie, Nov. 15, 2012

Northeast-Midwest Institute, Getting to the Bottom of Federal Spending and Taxation Patterns in the Northeast-Midwest Region, May 2011

E-mail interview with Andrew Reamer, research professor at the George Washington University Institute of Public Policy, Nov. 13-14,2012

PolitiFact, 'Red State Socialism' graphic says GOP-leaning states get lion's share of federal dollars, Jan. 26, 2012

PolitiFact Texas, MSNBC host Rachel Maddow says Texas routinely receives more federal dollars than Texans pay in federal taxes, April 22, 2011

U.S. Census Bureau, Consolidated federal funds report for fiscal year 2009, issued August 2010

CourierPostOnline.com, WHERE WE STAND: Federal dollars must return home, Nov. 8, 2012

Mother Jones, Most Red States Take More Money From Washington Than They Put In, Feb. 16, 2012

The Daily Beast, States That Sponge Tax Dollars, April 4, 2011

Wall Street Journal, Storm’s Toll Compared to Katrina’s, Nov. 13, 2012

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