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Center for Data Analysis Report #09-01 on Department of Homeland Security

March 9, 2009

An Analysis of Federal, State, and Local Homeland Security Budgets

By

Following the terrorist attacks on September 11, 2001, and Hurricane Katrina in 2005, Americans generally assumed that authorities in Washington, D.C., would shoulder the primary responsibility for securing the safety of the American homeland. This assumption is understandable given that over the past half century the federal government has amassed far more authority than was ever envi­sioned in the U.S. Constitution. Despite a rich his­tory of civilian defense in which states and localities have taken responsibility for their own affairs, we are federalizing more and more of the homeland security mission.

This approach is not only constitutionally incor­rect, but the states themselves could actually do the job better. Washington's one-size-fits-all solutions rarely succeed. The country's needs are too diverse, federal resources are physically too far from any one location to secure rapid response, and federal deci­sion making is notoriously inept. The Homeland Security and the States Project seeks to place responsibility where it should be according to the Constitution and where the most efficient, effective leadership resides.

This project focuses on four areas where a state and local lead is preferable: preparedness for and resiliency against terrorist attacks and natural disas­ters, disaster response, interior illegal immigration enforcement, and counterterrorism. This project involves four key phases:

  • Research and outreach to state and local associ­ations in Washington, D.C.;
  • State and local outreach using 10 regional roundtables;
  • Drafting, circulating for review and comment, and finalizing a suite of solutions across the four areas of focus for states and localities to enact or adopt; and
  • Launching an adoption campaign.

As part of the research process, we have gathered the homeland security budget data for specific states, cities, and counties; analyzed disaster response activities at the federal level historically; compiled initiatives and legislative actions to combat illegal immigration; and developed a counterterrorism capabilities survey for states and localities.

State and Local Contributions to Homeland Security

Since the 9/11 attacks, the understanding of homeland security has taken a predominantly fed­eral-centric meaning. Ironically, with the failed response to Hurricane Katrina this preference for a federal approach became even more ensconced. Given the limited homeland security resources available to the federal government compared to resources at the state and local level, a federally driven approach is a mistake, especially as federal funding reaches historic deficit levels.

From a personnel standpoint, the Federal Bureau of Investigation and Immigration and Customs Enforcement, the two federal agencies most involved in law enforcement activities in the states, have less than 25,000 agents for the entire United States. In comparison, state and local governments across America have more than 1 million law enforcement personnel. When firefighters and emergency manage­ment personnel are included, the state and local per­sonnel advantage is roughly 2,200,000 to 50,000.

In terms of budgets, while the total budget for all of the activities of the U.S. Department of Home­land Security (DHS) and the U.S. Department of Justice (DOJ) from 2000 to 2007 is greater than the states and localities highlighted in this report, it is likely smaller than total state and local government spending on homeland security activities.

Specifically, the eight-year combined budget for the DHS and DOJ is roughly $323 billion. The total eight-year homeland security budget (law enforce­ment, the fire service, and emergency management) for just the 26 states and District of Columbia and the 85 cities and counties that comprise the top 43 jurisdictions that are eligible for federal Urban Areas Security Initiative (UASI) funds due to the risk of a terrorist attack is at least $220 billion, or 68 percent of the combined DHS and DOJ budget. With the homeland security budgets of the remaining 24 states and thousands of cities and counties com­bined with the state military affairs budgets, state and local homeland security spending certainly exceeds federal spending.

Homeland Security as a National Enterprise

Fundamentally, we should view homeland secu­rity as a national enterprise, not as another opportu­nity for the federal government to take power and responsibility away from states and localities or to supplant state and local funds with federal funds. In regard to states and localities, much of the debate inside the Beltway revolves around the yearly fed­eral homeland security grant allocations and the allowable categories on which recipients are permit­ted to spend the funds. At its post-9/11 peak, fed­eral homeland security grant funds totaled less than $4 billion per year spread over hundreds, if not thousands, of jurisdictions across the United States.

While the Clinton Administration created grant programs specifically aimed at paying for the per­sonnel costs of state and local law enforcement officers, the Bush Administration typically took the position that personnel costs were inherently state and local obligations. The aim of federal homeland security grants should be centered on building crit­ical capabilities, which includes buying equipment, training first preventers and responders, and con­ducting exercises to test competency. This approach makes sense, and the Obama Administration should carefully weigh the options before making any drastic changes in that policy.

Arguably, hiring a local first responder with fed­eral funds supplants rather than supplements state or local funding. Conversely, acquiring a decontam­ination capability for chemical, biological, radiolog­ical, or nuclear agents with federal funds supplements the state or local funds that were already used to hire the local first responder who will use the capability. Using finite federal funds for filling core personnel needs only ensures that states and localities will divert their own resources to other uses and that critical homeland security capa­bilities will not be developed as personnel costs-a key driver of the cost of government-absorb an increasing share of federal grant funds.

Moreover, providing federal funds to high-risk jurisdictions to prevent or respond to a terrorist attack-given the national impact such an attack would have on the whole country-is a defensible use of taxes paid by individuals living outside of those jurisdictions. The same argument cannot be made for using the taxes paid by Iowans to hire a police office in Rochester, New York, to battle chronic crime. If Rochester needs more police offic­ers, then its citizens should pay for those positions.

Admittedly, much of the focus on federal grant funds is driven by governors, mayors, city council­men, and county commissioners (and their federal elected representatives) who are eager for the next round of federal government largesse. These juris­dictions need political leadership less focused on the relatively insignificant federal funds that they receive-just $23 billion over eight years-and more focused on ensuring that their public safety secretaries, state patrol superintendents, police chiefs, sheriffs, fire chiefs, homeland security advis­ers, and emergency management directors receive the necessary general-fund appropriations to hire the requisite number of personnel and to build the critical capabilities necessary in this age of terror.

Federal Homeland Security Grants

Federal homeland security grants represent only a small portion of the yearly state and local spend­ing on homeland security, ranging from a high of 17.7 percent in 2004 in North Carolina to a low of 0.1 percent in 2001 in Arizona. Even given its unen­viable designation as the terrorists' top target, New York City's portion of federal homeland security funds never exceeded 5 percent from 2000 to 2007. The eight-year average for the federal portion of homeland security in eight of the states-including the key states of California, Florida, and Illinois- was 5 percent or less.

California, the largest recipient of federal home­land security funds, received almost $1.5 billion, which averaged only 3.3 percent of its total home­land security funds. Hawaii, the smallest recipient of federal homeland security funds, received just under $115 million. In many cases, the federal funds are needed to acquire critical capabilities, but in no case should the federal funding tail wag the state and local dog, as it does today given the pleth­ora of federal mandates and requirements that accompany federal funds.

From 2000 to 2007, the combined budgets for law enforcement and the fire service increased by an average of 3 percent to 6 percent per year. Texas (8.3 percent), Arizona (8 percent), California (8 per­cent), and Florida (8 percent) led the way with the largest average increases. In Georgia, Illinois, and New York, the budgets grew by less than 1 percent. In Louisiana, the average state and local budget actually decreased by 2.8 percent.

While in many cases the budgets for emergency management agencies increased by sizable percent­ages, the amount appropriated from general fund dollars in real dollars was low, especially when com­pared to police, sheriff, and fire appropriations. Specifically, in the 31 jurisdictions where specific appropriations for only emergency management agencies could be determined, 21 (68 percent) appropriated less than $1,000,000 in most years.

In the other 10 jurisdictions, the appropriations typically were less than $2,500,000 per year. Most jurisdictions did not substantially increase emer­gency management appropriations after 9/11 and Hurricane Katrina. Given the increase in Federal Emergency Management Agency (FEMA) declara­tions over the past 16 years for routine natural disasters, which historically have been handled almost entirely by state and local governments,[1] emergency management budgets at the state and local level should have similarly increased to deal with these disasters. As many experts have com­mented, FEMA's increased activity, including its 75 percent or more cost-share, has displaced state and local general fund investments in emergency man­agement personnel and capabilities.

It is time for state and local elected officials to take back the mantle of leadership that should come with their enormous investments in first preventers and responders. Because DHS has failed to deter­mine which critical capabilities have been acquired with the $23 billion in federal homeland security grant funds allocated to states and localities thus far,[2] state and local leaders should determine which capability gaps remain and spend their future fed­eral funds to close those gaps.

As the state, city, and county profiles contained in this report demonstrate, the instruments of national power do not reside on the banks of the Potomac River. Rather, the instruments of national power reside in the 50 state capitals and in the countless city halls and county commissions that appropriate billions of dollars annually for the men and women who patrol our streets, investigate potential terrorist plots, extinguish our structural and wild land fires, and respond in times of crises.

The 43 UASI jurisdictions featured in this report contain approximately 145 million Americans, which is 47 percent of the total population of the United States. To serve these people, an enormous amount of America's critical infrastructure is also located in these jurisdictions. With so many people and so much critical infrastructure, these 43 urban areas possess large vulnerabilities, and an attack on one of them could have catastrophic national conse­quences. Given the propensity of terrorist groups to attack sites in large cities, we must ensure that these localities have the resources to keep us safe.

Rather than continue to spread federal funds using "an inch thick and a mile wide" mentality, Congress should reform the federal grant programs to target the maximum amount of federal funds at the highest-risk states, cities, and counties-where the funds could meaningfully increase the security of Americans. After seven years of forcing states to distribute 80 percent of funds in the Homeland Security Grant Program to cities and counties with little to no risk, Congress should allow them to keep 100 percent so that they can build critical capabili­ties as quickly as possible.

At the same time, Congress needs to reduce the number of urban areas eligible for the UASI pro­gram so that funds are not unnecessarily diluted by having too many mouths to feed, which is what happened in fiscal year (FY) 2008 when the number of eligible jurisdictions was increased to 60. In FY 2008, 42 urban areas (not including New York City, Houston, the Bay Area, and Jersey City-Newark) received exactly 3 percent less than they received in FY 2007.[3] This means that DHS simply cut 3 per­cent from each urban area's homeland security allo­cation to "feed" the 14 new urban areas added to the list for FY 2008, instead of using a competitive pro­cess to allocate funding according to risk and capa­bility needs. This also means that urban areas wasted considerable time and money putting together investment justifications that had no impact on their federal allocations.

States and localities deserve more respect and seriousness from the federal government. As this report shows, a substantial amount of activity occurs to secure our homeland outside the Beltway. It is high time to acknowledge the commitments made by our states and localities and to give them the opportunity to lead our domestic homeland security efforts.

Starting a National Debate

Lost in the din and roar in America over the cur­rent financial crisis, a timely opportunity has pre­sented itself for America's governors. Rather than extend open palms to Washington, D.C., for bailout funds or increased homeland security grants, these constitutionally empowered executives should force a national debate on the proper role of the federal government and the amount of tax dollars it uses.

This debate is not about whether government should be bigger or smaller. This debate is about making government at all levels work more effi­ciently. It makes little sense to send tax dollars to Washington to pay the federal bureaucracy to return a smaller amount back to the states. Gover­nors should demand that the federal government substantially lower its taxes so that states can raise their taxes to keep a greater share of the overall tax burden. With increased funds, states can properly take care of their residents without the federal man­dates, strings, and interference that always accom­pany federal funds.

It is time for a brave band of governors to reas­sert their federalist voices, not just in securing our homeland from terrorists, but also in securing the vibrancy of Justice Louis Brandeis's "laboratories of democracy" that have kept America strong for 222 years.

Matt A. Mayer is a Visiting Fellow at The Heritage Foundation, President and Chief Executive Officer of Provisum Strategies LLC, and an Adjunct Professor at Ohio State University. He has served as Counselor to the Deputy Secretary and Acting Executive Director for the Office of Grants and Training in the U.S. Department of Homeland Security. He is author of Homeland Secu­rity and Federalism: Protecting America from Out­side the Beltway, which will be published in June 2009. The author especially thanks all of the state and local government employees who provided budget data that was not publicly available on the Internet. Without their aid, this report would have contained far less data.

Appendix A Methodology

The data gathered includes all relevant budget data for 111 jurisdictions for FY 2000 through FY 2007. Because the focus of this project is homeland security, the budget data include primary law enforcement agencies, fire departments, homeland security offices, and emergency management agen­cies. In some cases, the emergency management agency budget data were embedded in the fire department budget data and could not be separately noted in its own category. Of the 1,836 data cells plotted, budget data for 1,662 cells (91 percent) were obtained.

Because the comparison federal data consist of homeland security grants that are part of the gen­eral-fund appropriations for the Department of Homeland Security, the budget data represent the general-fund appropriation only. In a few cases the budget data include non-general-fund revenue such as fees or special taxes. In many cases, the total appropriation for agencies and departments is greater than the general fund appropriation.

A secondary, but equally important, reason for using only general fund appropriation budget data is that those appropriations represent the dif­ficult decisions made by legislative bodies to allo­cate finite general-fund dollars among competing demands, such as transportation, health care, and education. Hence, state legislatures, city councils, and county commissions evaluated the various needs of their jurisdictions, assessed the home­land security risks, and allocated general funds accordingly.

In selecting the states, cities, and counties to include in this report, the state had to possess a des­ignated UASI jurisdiction and the city and county had to belong to a designated UASI jurisdiction that had received at least $15 million from FY 2003 to FY 2007 from the DHS. Twenty-six states, the Dis­trict of Columbia, and 43 UASI jurisdictions satis­fied this requirement. In total, these 43 UASI jurisdictions include 50 primary cities and 35 pri­mary counties for which data were collected. Those jurisdictions are:

Anaheim-Santa Ana
Atlanta
Baltimore
Baton Rouge
Bay Area
Boston
Buffalo
Charlotte
Chicago
Cincinnati
Cleveland
Columbus
Dallas Area
Denver
Detroit
District of Columbia
Fort Lauderdale
Honolulu
Houston
Indianapolis
Jacksonville
Jersey City-Newark
Kansas City
Las Vegas
Los Angeles-Long Beach
Louisville
Memphis
Miami
Milwaukee
Minneapolis-Saint Paul
New Orleans
New York City
Orlando
Philadelphia
Phoenix
Pittsburgh
Portland
Sacramento
San Antonio
San Diego
Seattle
St. Louis
Tampa
Kansas City
Las Vegas
Los Angeles-Long Beach
Louisville
Memphis
Miami
Milwaukee
Minneapolis-Saint Paul
New Orleans
New York City
Orlando
Philadelphia
Phoenix
Pittsburgh
Portland
Sacramento
San Antonio
San Diego
Seattle
St. Louis
Tampa

Appendix B Charts and Tables

Show references in this report

[1] James Jay Carafano and Matt A. Mayer, "FEMA and Federalism: Washington Is Moving in the Wrong Direction," Heritage Foundation Backgrounder No. 2032, May 8, 2007, at http://www.heritage.org/Research/HomelandDefense/bg2032.cfm.

[2] Matt A. Mayer and James Jay Carafano, "After the 9/11 Act: Homeland Security Grants Still Moving in the Wrong Direc­tion," Heritage Foundation Backgrounder No. 2059, August 3, 2007, at http://www.heritage.org/Research/HomelandDefense/bg2059.cfm.

[3] Matt A. Mayer, "Congress Should Reassess the Allocation of Homeland Security Grants," Heritage Foundation WebMemo No. 2011, August 6, 2008, at http://www.heritage.org/Research/HomelandSecurity/wm2011.cfm.

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