The 10 States Most Dependent on the Federal Government When it comes to jobs and revenue, these states lean most heavily on the federal government. This story originally appeared on SmartAsset.com. The U.S. is a federal republic, meaning that power is held by both the central federal government, located in Washington, D.C., and by the governments of every state and territory that make up the union. But the “division of powers” isn’t as simple as it seems — and neither is the division of finances, since states rely on the federal government for money and various programs to help them operate. With all this in mind, SmartAsset crunched the numbers to see which states are the most dependent on the federal government.