North Carolina Receives a “D” in Annual Report on Transparency of Government Spending

NCPIRG Education Fund

March 26 – North Carolina received a “D” when it comes to government spending transparency, according to “Following the Money 2013: How the States Rank on Providing Online Access to Government Spending Data,” the fourth annual report of its kind by the NCPIRG Education Fund.

“State governments across the country have become more transparent about where public money goes, providing citizens with the information they need to hold elected officials and businesses that receive public funds accountable,” said Phineas Baxandall, senior analyst for tax and budget policy with the NCPIRG Education Fund. “But North Carolina still has a long way to go.”

Officials from North Carolina and 47 other states provided the researchers with feedback on their initial evaluation of state transparency websites. The leading states with the most comprehensive transparency websites are Texas, Massachusetts, Florida, Illinois, Kentucky, Michigan, and Oklahoma.

Based on an inventory of the content and ease-of-use of states’ transparency websites, “Following the Money 2013” assigns each state a grade of “A” to “F.” The report describes North Carolina as a “lagging state” in online spending transparency. The state’s “NC Open Book” website provides checkbook-level spending information on contracts and grants. However, it lacks detailed information in other areas such as on economic development tax credits and non-contract payments to vendors, as well as descriptions of projected and achieved benefits of economic development subsidies.

As a result of rising grading standards, North Carolina’s “B+” grade from last year dropped to a “D” this year. In order for states to keep up with rising standards and maintain high scores, they must continually improve transparency. Last year, North Carolina was able to obtain a relatively high score because it provided some checkbook-level spending data. This year, the scoring gave credit separately for checkbook-level data on contracts, grants, economic development tax credits, and other expenditures.  North Carolina lost points because it currently provides access to this data only for grants and contracts.

“Let’s be clear,” said Baxandall, “North Carolina’s falling score does not mean spending has become less transparent. It means other states are improving faster.” 

Since last year’s “Following the Money” report, there has been remarkable progress across the country with new states providing online access to government spending information and several states pioneering new tools to further expand citizens’ access to this data. 

One of the most striking findings in this year’s report is that all 50 states now provide at least some checkbook-level detail about individual government expenditures. In 48 states—all except California and Vermont—this information is now searchable. Just three years ago, only 32 states provided checkbook-level information on state spending online, and only 29 states provided that information in searchable form. Thirty-nine state transparency websites now include tax expenditure reports, providing information on government expenditures through tax code deductions, exemptions and credits—up from just eight states three years ago.

“Open information about the public purse is crucial for democratic and effective government,” said Baxandall. “It is not possible to ensure that government spending decisions are fair and efficient unless information is publicly accessible.”

The states with the most transparent spending stand out partly because they are comprehensive about the kinds of spending they include, such as data on economic development subsidies, expenditures granted through the tax code, and quasi-public agencies. At least six states have launched brand new transparency websites since last year’s report, and most made improvements that are documented in the report. The best state transparency tools are highly searchable, engage citizens, and include detailed information—allowing all the information to be put to good use. 

States that have created or improved their online transparency have typically done so with little upfront cost. In fact, top-flight transparency websites can save money for taxpayers, while also restoring public confidence in government and preventing misspending and pay-to-play contracts.

“The state of North Carolina should improve the breadth and ease-of-access of online government spending information,” said Baxandall. “Given the state’s difficult budget choices, North Carolinians need to be able to follow the money.”

To access the state’s transparency website, click here.

To read the report, click here.

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NCPIRG Education Fund works to protect consumers and promote good government. We investigate problems, craft solutions, educate the public, and offer meaningful opportunities for civic participation. www.ncpirgedfund.org