On March 27, the Bureau of Economic Analysis (BEA) at the U.S. Department of Commerce released preliminary data on state personal income and per capita personal income for 2012, in addition to revisions for previous years. According to BEA’s estimates, state personal income grew at a rate of 3.5 percent in 2012, slower than the 5.2 percent growth rate in 2011. BEA calculates per capita personal income as the total personal income of state residents divided by the population of the state, using the Census Bureau’s annual midyear population estimates. Federal government agencies use state per capita income as the basis for allocating funds and determining matching grants to states for a number of grant programs, including the Federal Medical Assistance Percentage (FMAP). Federal Funds Information for States (FFIS) recently published an issue brief, available to FFIS subscribers, with estimates of the preliminary fiscal 2015 FMAPs for states based on the latest BEA data. State personal income statistics are also used by the federal government to forecast energy and water use and by state governments to project tax revenues and public service demands.

Link(s): News Release; FFIS Issue Brief