Charges

State and Local Backgrounders Homepage

Charges include tuition paid to a state university, payments to a public hospital, tolls on highways, and sewerage and parking meter fees collected by a city.

Although individual charges can be as little as a few dollars, in aggregate charges provide a substantial amount of revenue for state and local governments. This is especially true in states that collect relatively little tax revenue.

How much revenue do state and local governments raise from charges?

State and local governments collected a combined $479 billion in revenue from charges in 2015, or 16 percent of general revenue. As a group, charges accounted for nearly as much revenue as sales taxes and property taxes and more revenue than individual income taxes and corporate income taxes combined.

Charges are a large source of revenue for both states and local governments. State governments collected $201 billion (11 percent of general revenue) from charges in 2015, and local governments collected $279 billion (18 percent of general revenue).

State and Local Revenue from Charges, 2015

 

Revenue ($ billions)

Percentage of general revenue

States and local government

$479

16%

States

$201

11%

Local governments

$279

18%

Which states are most reliant on revenue from charges?

Among the 50 states in 2015, charges as a percentage of general revenue ranged from 8 percent in Connecticut to 28 percent in South Carolina. Charges were 6 percent of general revenue in the District of Columbia. In addition to South Carolina, charges accounted for 20 percent or more of general revenue in Alabama, Colorado, Florida, Indiana, Iowa, Kansas, Mississippi, North Carolina, Utah, Virginia, and Washington.

Data: View and download each state's general revenue by source as a percentage of general revenue

Which charges generate the most revenue?

Among the $479 billion in revenue state and local government collected from charges, the largest contributors were hospital fees (charges collected from patients, private insurance companies, and public insurance programs such as Medicare), higher education payments (mostly tuition), sewerage fees, higher education receipts (money spent on dormitories, athletic contests, books, and other commercial activities), and air transportation (hangar rentals and landing fees).

State governments collected the most revenue from higher education charges, hospitals, and highways (including both reimbursement for repairs and fees from toll roads). Local governments collected the most revenue from hospitals, sewerage, air transportation, solid waste management (fees for garbage and recycling collection and disposal), and parks and recreation (fees from swimming pools as well as camping areas). For more on the different types of charges see the US Census Bureau’s classification manual page.

Charges that Generated the Most Revenue, 2015

 

Revenue ($ billions)

Percentage of general revenue

State and local government (total)

$479

16%

1. Hospitals

$145

5%

2. Higher education (tuition)

$81

3%

3. Sewerage

$54

2%

4. Higher education (Receipts from sales)

$26

1%

5. Air Transportation

$22

1%

States (total)

$201

11%

1. Higher education (tuition)

$75

4%

2. Hospitals

$62

3%

3. Higher education (receipts from sales)

$25

1%

4. Highways

$10

1%

5. Natural resources

$3

<1%

Local governments

$279

18%

1. Hospitals

$83

5%

2. Sewerage

$53

3%

3. Air transportation

$20

1%

4. Solid waste management

$17

1%

5. Packs and recreation

$9

1%

Further reading

Ferguson city finances: not the new normal

Notes

All revenue data are from the US Census Bureau’s Annual Survey of State Government Tax Collections.  All dates in sections about revenue reference the fiscal year unless stated otherwise.

The Census of Governments’s measure of general charges includes the following categories: air transportation, education (e.g., school lunches, athletic contest tickets, college tuition), highways and toll roads, hospitals, housing and community development, natural resources, parking, parks and recreation, sewerage, waste management, water transportation, miscellaneous commerce activity, and all other “not elsewhere classified.”