Government officials are fiscally optimistic. They see improving budgets and increased spending. More than four out of five administrators (86 percent) see their government’s budgets in the second half of 2014 equal to or greater than second half 2013 budgets, according to an exclusive E-survey of readers of Penton magazines Government Product News, American City & County and Government Procurement.

Sure, times are still tough for U.S. cities and counties. Some survey respondents (about 14 percent) say they will spend less on 11 kinds of government functions (such as public transportation and water) in 2014 compared to 2013. But a total of 82 percent of survey respondents will spend more or about the same on those government functions in 2014. About 27 percent will spend more and 55 percent will spend the same in 2014.

Yes, government officials may be more upbeat than they have been in the past, based on the survey results: Almost six out of 10 respondents say they expect to receive the same level or more federal and state funding to their local government in 2015 compared to 2014.

One area of concern: health care. About half of the 240 respondents report their jurisdiction will be budgeting more on health coverage for employees in 2014 compared to 2013.

The survey results mesh with findings from Lexington, Mass.-based economic forecaster IHS Global Insight on the topic of budget growth and planned government spending. IHS predicts that government purchases of goods and services will grow from $3.15 trillion in 2014 to $3.22 trillion in 2015. In 2013, government purchases totaled $3.13 trillion, say IHS economists.

Federal Outlook

Federal government purchases of goods and services have remained stable, say IHS Global Insight forecasters. Uncle Sam is on target to spend the following on goods and services, according to IHS estimates:

Year   Value of purchases
2013   $1.25 trillion
2014   $1.23 trillion
2015   $1.24 trillion

The Congressional Budget Office (CBO) predicts federal revenues will grow in the years ahead. In 2013, federal revenues totaled $2.77 trillion. In 2014, they are projected to grow to $3.03 trillion. For 2015, the CBO is projecting federal revenues at $3.31 trillion.

Challenges remain for federal budget planners through the rest of this decade. One example: the Social Security Administration’s Social Security Disability Insurance (SSDI) entitlement program will run out of cash by 2016 unless Congress takes action. More than 11 million Americans currently rely on the program.

In future Keating Report mid-year 2014 installments, read about state and local government budget trends as well as the mid-year 2014 government and public works construction outlook.    

Michael Keating (photo at right) is senior editor for Government Product News and the GPN web site. He can be reached via e-mail at michael.keating@penton.com