Federal Funds: Documentation

"Federal Funds" Data

The principal data source we used to construct these files is the Consolidated Federal Funds Reports (CFFR) data from the U.S. Department of Commerce, Census Bureau, Governments Division. We usually refer to these data as the "Federal Funds" data. Census collects these fiscal year data annually from each Federal Department or Agency. We aggregated the data to the county and State level.

Caution should be used when interpreting the data. Not all of these programs had reliable data at the county level. Each program has individual characteristics that affect the way the data can be used to interpret geographic patterns.

For example, funds for many programs go directly to State capitals or regional centers that redistribute the money or program benefits to surrounding areas. Examples include block grant programs and some procurement programs that involve a substantial degree of subcontracting. The Census Bureau screens the data to identify such programs, and we have added our own screens to identify those programs in which 25 percent or more of their funds are allocated to State capitals and programs in which only a small percentage of funds are allocated to the county level. Those programs that made it through our screens, which we believe are fairly accurate to the county level, are called zero disposition code programs. For the screened-out programs (disposition codes 1, 2), we believe it is only meaningful to indicate geographic variations among States but not among counties; and for some programs with disposition code 3, even variations among States are not reliable since such programs may include a large proportion of funding not allocated to individual States.

The benefits of Federal programs do not all go to the places that receive funds. For example, money spent on national parks benefits all who visit the parks and not just those who live where the parks are located. Rural electric loans are reported to the location of the company headquarters and do not indicate other places that receive subsidized electricity. Such "spillover" benefits are present in almost all Federal programs and are not reflected in the Federal funds data. In addition, these programs affect communities in a variety of ways and have different multiplier impacts on local income, employment, and community well-being. Thus, even if the reported funding dispersion is considered to be an accurate depiction of where the funds end up being spent, care is required when interpreting the data as program impacts.

Federal Funds data may represent either program expenditures or program obligations, depending on the form of the data provided to Census. Direct loans and loan guarantees are reported according to the volume of loans obligated (for guarantees, it includes only the portion of the loans that is guaranteed), and do not take into account interest receipts or principal payments. Consequently, these data do not always correspond to program totals reported in government budget documents, such as budget authority, outlays, or obligations.

Disposition Codes

Disposition codes were produced by ERS screening of data from CFFR to determine the extent to which the data may reflect funds that are tracked only to the State capital city or county. Programs with funding allocated to counties but with less than 25 percent of funding going to State capitals, or State or U.S. undistributed, nationwide, were considered to be accurate at the county level (disposition code 0). Those with 25 percent or more funding going to State capitals or undistributed among counties (disposition codes 1, 2, and 3) were considered to be inaccurate at the county level because a significant amount of funding that was reported as State undistributed or going to State capitals may ultimately be passed through to other local areas in one form or another.

Each individual program has one of these four disposition codes (0, 1, 2, and 3).

• Disposition Code = 0. Data considered accurate at the county level, for all States.

• Disposition Code = 1. All data reported to the county level, but 25 percent or more of the funds went to State capitals. Hence, data are not considered accurate at the county level.

• Disposition Code = 2. At least 3 percent of funding reported to the county level, but State or U.S. undistributed funds accounting for more than 25 percent of the program total. This usually occurs when Federal Funds data are available at the county level for some States, but not for other States. Hence, the data are not generally available or accurate at the county level.

• Disposition Code = 3. More than 97 percent of the funding is either State or U.S. undistributed, hence not available at the county level.

Object Codes

CFFR data are classified by broad object categories in accordance with the CFFR Act. These correspond, in general, to the classification used in annual Federal Budget. Two alphabetic letters are used to designate the broad object category of Federal expenditure. These include:

• Object Code = SW. Salaries and Wages. These include salaries and wages paid to Federal Government employees, for example, to Defense Department military employees—both active and inactive—and civilian employees of the Defense Department, U.S. Postal Service, U.S. Coast Guard, Federal Bureau of Investigation, and all other Federal Government civilian employees.

• Object Code = PC. Procurement Contracts. Procurement contracts of the Defense Department, U.S. Postal Service, and all other civilian contracts.

• Object Code = DR. Direct Payments for individuals for retirement and disability.

• Object Code = DO. Direct Payments to individuals, other than for retirement and disability. Examples include unemployment compensation benefit payments, Federal payments for excess earned income tax credits, vocational rehabilitation for disabled veterans, public safety officers' death benefits, Medicare hospital insurance, Medicare supplementary medical insurance, food stamps, and unemployment compensation benefit payments (Federal to State).

• Object Code = DX. Direct Payments other than to individuals. Examples include Government payments to the U.S. Postal Service, Federal Employee Life and Health Insurance premium payments—employee share, Legal Service Corporation payments, farm payments, veterans' education assistance, rural rental assistance payments, and interest reduction payments for rental and co-operative housing for low-income families.

• Object Code = GG. General Grants. Include block grants, formula grants, project grants, and cooperative agreements.

• Object Code = DL. Direct Loans. Examples include commodity loans and purchases, emergency loans, farm ownership loans, farm operating loans, soil and water loans, irrigation system rehabilitation and betterment loans, intermediary relending programs, economic injury disaster loans, physical disaster loans, loans for small businesses, direct investment loans, water and waste disposal systems for rural communities, and community facilities loans.

• Object Code = GL. Guaranteed/Insured Loans. Examples include farm operating loans, soil and water loans, business and industrial loans, small business investment companies, small business loans, State and local development company loans, bond guarantees for surety companies, certified development company (504) loans, foreign investment guarantees, water and waste disposal systems for rural communities, community facilities loans, rural electrification and rural telephone loans and loan guarantees, rehabilitation mortgage insurance, mortgage insurance of homes—specially of low- and medium- income families, veterans homes and nursing homes—and higher education insured loans.

Individual program data were reported mainly for grants, direct payments, and loans. Salaries and procurement data were generally not available by Federal program. Instead, these expenditures were broken down into subcategories for the Department of Defense and selected other agencies. Each subcategory is treated as if it were a separate Federal program, with a program ID Code beginning with the relevant Object Code.

Several programs have more than one type of assistance, such as loans and grants. These programs are incorporated in this data set as if each type of assistance qualified as a separate program. For example, the farm ownership loan program is broken up into two components: direct loans (DL) and guaranteed loans (GL).

Functions Codes

Each Program is assigned a function code developed by ERS as follows:

• Agriculture and natural resources functions. Includes agricultural assistance (110), agricultural research and services (120), forest and land management (130), and water and recreational resources programs (140).

• Community resources functions. Includes business assistance (210), community facilities (220), community and regional development (230), environmental protection (240), housing other than veterans (250), housing for veterans (260). Native American general assistance programs (270), and transportation programs (290).

• Defense and space functions. Includes aeronautics and space (310), defense contracts (320), and defense payrolls and administration (330).

• Human resources functions. Includes elementary and secondary education (410), food and nutrition (420), health services (430), social services (440), and training and employment (450).

• Income security functions. Includes medical and hospital benefits (510), public assistance and unemployment compensation (520), retirement, disability, and survivors social security payments (530).

• National functions. Includes criminal justice and law enforcement (610), energy (620), higher education and research (630), and all other federal funds programs excluding insurance programs (640).

Each year, ERS reviews the programs to assign function codes to new programs in the data set, and sometimes existing programs receive a new function code reflecting a change in function.

Program Identification Codes (Program Code)

Each program in the CFFR has a program identification code patterned after its Catalog of Federal Domestic Assistance (CFDA) program number. This is a six- character code. The first two characters identify the Federal Department or Agency that administers the program, followed by a decimal and three numeric characters identifying the program. The two-digit codes representing Federal departments and agencies as of 2001 were as follows:

• 10 = Department of Agriculture
• 11 = Department of Commerce
• 12 = Department of Defense
• 14 = Department of Housing and Urban Development
• 15 = Department of the Interior
• 16 = Department of Justice
• 17 = Department of Labor
• 19 = Department of Defense
• 20 = Department of Transportation
• 21 = Department of Treasury
• 23 = Appalachian Regional Commission
• 30 = Equal Employment Opportunity Commission
• 43 = National Aeronautics and Space Administration
• 45 = National Foundation on the Arts and the Humanities
• 47 = National Science Foundation
• 57 = Railroad Retirement Board
• 59 = Small Business Administration
• 60 = Smithsonian Institute
• 64 = Department of Veterans Affairs
• 66 = Environmental Protection Agency
• 70 = Overseas Private Investment Corporation
• 77 = Nuclear Regulatory Commission
• 81 = Department of Energy
• 83 = Federal Emergency Management Agency
• 84 = Department of Education
• 86 = Pension Benefit Guaranty Corporation
• 89 = National Archives and Records Administration
• 91 = International Peace
• 93 = Department of Health and Human Services
• 94 = Corporation for National and Community Service
• 96 = Social Security Administration

In recent years, new agency codes have been provided for new agencies. For example, programs funding various nonprofit organizations or foundations are now indicated by an agency code of 85, programs funding various Federal commissions and authorities, including the Delta Regional Authority and the Denali Commission, are now indicated by an agency code of 90; while the Homeland Security Agency is listed with an agency code of 97.

Program names and their CFDA numbers sometimes change from year to year, reflecting program changes and shifts from agency to agency. Programs may also be in the data set one year and not in the next due to unavailability of data. Hence, caution is required when comparing funding from year to year.

If a CFDA program number did not exist, a pseudo CFDA code was assigned by the agency submitting the data. This pseudo code consists of two numeric characters (representing the agency prefix in the CFDA), followed by the decimal and three alphabetic characters. Pseudo codes are also used for some other items that do not fall under officially recognized programs such as Federal retirement payments, wages and salaries, etc. These pseudo codes begin with two alphabetic characters, followed by three numeric characters.

Excluded Programs and Territories

Census reports CFFR data for several insurance programs using an Object Code = II. These data are excluded from the ERS Federal Funds data files for individual States, because the reported amounts reflect the value of property that is newly insured rather than the amount of payments or claims associated with the program. The ERS Federal Funds data files also exclude a few programs that were targeted exclusively at U.S. Territories. (The data for these excluded programs may be obtained directly from Census. They are also present on the ERS MS Access file covering the Nation as a whole.)

Other Data

Population

The county population estimates are from the Bureau of Economic Analysis, and are for calendar years. For example, for 2005 Federal funds data, the population data are for calendar year 2005. Population data can be used to compute federal funds per person, which is useful for making meaningful comparisons across counties.

FIPS Codes

Five-digit FIPS (Federal Information Processing Standard) codes are used to identify specific geographic areas. The first two digits represent the State, the last three digits represent the county (or county area). If the county is unknown, the amounts are reported in the State undistributed column and the last three digits of the FIPS are 999.