New York state spends six times more per capita on welfare benefits than Sun Belt states, and that is one reason why Northeast states like New York are hurting financially while the South and Southwest are becoming prosperous, a new report says. Only Hawaii and Vermont are more generous to their indigent residents than New York, according to a report issued by State Comptroller Edward V. Regan. He said the high cost of public assistance and Medicaid programs in the Empire State was partly responsible for the loss of jobs and population to the Sun Belt. "One can speculate that a raise in benefits would discourage the poor from seeking other opportunities while continuing to encourage businesses to leave because of tax burdens which remain high compared to other developing parts of the country," Regan said. The report found that one out of every 13 individuals in New York receives public assistance benefits, compared to one of every 28 persons in the Sun Belt.

New York state annually contributes $177 per capita for state welfare programs, compared with $24 for residents of the Sun Belt, six times more. "Even after adjustments for cost-of-living differences," Regan said, "the public assistance benefits of New York State are twice that of states in the Sun Belt. Regan said "the poor are becoming trapped" in New York, although the jobs are in such Sun Belt states as Alabama, Arizona, Arkansas, Florida, Georgia, Louisana, Mississippi, New Mexico, North Carolina, South Carolina, Tennessee and Texas. "Subsistence-level public assistance programs in the Sun Belt are clearly designed to discourage welfare recipients and even marginal job seekers from entering those states," Regan said.