Leviathan or Flypaper: Examining the Fungibility of Earmarked Local Sales Taxes for Transportation

Analyses of the relationships of earmarked finances on their respective programs and total expenditures have produced conflicting views of how governments spend earmarked revenue. Some show that earmarks are used in addition to existing finances to increase the total level of funding for recipient p...

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Bibliographic Details
Published inPublic budgeting & finance Vol. 35; no. 3; pp. 1 - 23
Main Author Afonso, Whitney B.
Format Journal Article
LanguageEnglish
Published Malden Blackwell Publishing Ltd 01.09.2015
Subjects
Appropriations
Budgets
Expenditures
Government spending
Revenue
Sales taxes
Taxation
Transportation
Transportation planning
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Summary:Analyses of the relationships of earmarked finances on their respective programs and total expenditures have produced conflicting views of how governments spend earmarked revenue. Some show that earmarks are used in addition to existing finances to increase the total level of funding for recipient programs while others show that earmarks are fungible and program spending is unchanged. An analysis on local option sales taxes earmarked for transportation (LOST‐Ts) suggests that transportation spending is increased by more than LOST‐T revenue. For every dollar generated by LOST‐Ts, transportation spending increases by an estimated $1.76 and nontransportation spending decreases by an estimated $0.73.
Bibliography:ark:/67375/WNG-LMWC01RN-6
ArticleID:PBAF12072
istex:A9ECC3064949D1925A74463D2AAB2FED4FA79B6D
ISSN:0275-1100
1540-5850
DOI:10.1111/pbaf.12072