Ranking the States by Fiscal Condition, 2016 Edition

Abstract

Based on the fiscal year 2014 comprehensive annual financial reports of the 50 states and Puerto Rico, this study ranks states’ fiscal solvency using 14 metrics that assess the extent to which the states can meet short-term bills and longer-term obligations. State finances are analyzed according to five dimensions of solvency: cash, budget, long-run, service-level, and trust fund solvency. These five dimensions are combined to produce an overall ranking of state fiscal solvency. Alaska, Nebraska, Wyoming, North Dakota, and South Dakota rank as the top five most fiscally solvent states. Kentucky, Illinois, New Jersey, Massachusetts, and Connecticut rank as the bottom five states, with Puerto Rico taking 51st place.