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Budget Issues: Capital Budgeting Practices in the States

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Report Type Reports and Testimonies
Report Date July 15, 1986
Report No. AFMD-86-63FS
Subject
Summary:

In response to a congressional request, GAO obtained information on the states' capital budgets.

GAO found that of the 45 states responding to a questionnaire: (1) 37 have a distinct capital budget; (2) 13 do and 17 do not combine their capital and operating amounts into an overall unified budget total; (3) 7 use various other procedures to report their capital budget amounts; (4) 15 do not link long-term borrowing to the life of the asset; (5) 19 link long-term borrowing to assets; (6) 22 report the principal and interest payments on their capital debt within their noncapital budget; and (7) 3 report principal and interest payments in capital and noncapital budgets. GAO also found that: (1) the three largest sources of revenue for capital expenditures are general taxes, long-term borrowing, and federal funds; and (2) it could not determine whether long-term borrowing is linked to assets for three states.

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