12 States With the Worst Fiscal Health | ThinkAdvisor

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12 States With the Worst Fiscal Health

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12. Vermont | Cash solvency: 246% | Revenues to expenses: 105% | Long-term liabilities to total assets: 68% | Pensions to income: 34%

11. Rhode Island | Cash solvency: 184% | Revenues to expenses: 103% | Long-term liabilities to total assets: 90% | Pensions to income: 40%

8. New York │ State income tax: 4.0% (on taxable income less than $8,500/single, $17,150/joint)/8.82% (on taxable income more than $1,070,550/single, $2,155,350/joint). Average local income tax: 1.94% │ Average local sales tax: 8.49% │ Gas taxes and fees: $0.46/gallon (varies by county) │ Property taxes: median $4,738 on median home value of $286,300 │ Estates exceeding $5,250,000 subject to estate tax, with a top rate of 16%. In 2019, it will be indexed to the federal exemption. │ Sin taxes: Yes

9. California | Cash solvency: 119% | Revenues to expenses: 104% | Long-term liabilities to total assets: 92% | Pensions to income: 54%

8. West Virginia | Cash solvency: 154% | Revenues to expenses: 101% | Long-term liabilities to total assets: 43 % | Pensions to income: 41%

7. Delaware | Cash solvency: 195% | Revenues to expenses: 96% | Long-term liabilities to total assets: 61% | Pensions to income: 30%

2. New Mexico | Cost of living: 22 | Crime: 50 | Culture: 37 | Health care quality: 49 | Taxes: 34 | Weather: 21 | Well-being: 26

5. Kentucky| Cash solvency: 152% | Revenues to expenses: 98% | Long-term liabilities to total assets: 138% | Pensions to income: 61% (Photo: AP)

12. Massachusetts | Cost of living: 46 | Crime: 14 | Culture: 2 | Health care quality: 3 | Taxes: 22| Weather: 34 | Well-being: 11

3. New Jersey | Cash solvency: 244% | Revenues to expenses: 89% | Long-term liabilities to total assets: 388% | Pensions to income: 49%

2. Connecticut | Cash solvency: 100% | Revenues to expenses: 92% | Long-term liabilities to total assets: 230% | Pensions to income: 48% (Photo: AP)

7. Illinois | Cost of living: 36 | Crime: 25 | Culture: 35 | Health care quality: 30 | Taxes: 29 | Weather: 23 | Well-being: 36

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(Related: 12 States With the Best Fiscal Health)

In its 2018 study on state fiscal rankings , George Mason University’s Mercatus Center found some U.S. states remained at the bottom of the pack, while some surprising ones topped the list.

The study ranked states according to 1) Cash solvency, or ability to cover short-term bills; 2) Budget solvency, or ability to cover a fiscal year’s worth of spending with revenues without a shortfall; 3) Long-run solvency, or ability to meet long-term spending needs and weather economic shocks; 4) Service-level solvency, or “fiscal slack” to increase spending if citizens demand more services; and 5) Trust fund solvency, or the status of unfunded pension and health care liabilities, as well as other debt.

State Budget Gaps

State budgets overall are still below prerecession levels, long-term liabilities have, on average, increased over time, and underfunded pension liabilities remain an ongoing problem.

However, for those at the bottom, there’s good news: The study concludes the fiscal problems of all states are not “insurmountable.”

The Mercatus Center is a free-market oriented think tank, whose board includes Charles Koch, former executive VP of Koch Industries Richard Fink, president of the Charles Koch Foundation Brian Hooks, and Edwin Meese, who served as attorney general in the Reagan administration.

Check out the gallery above for the 12 states in the worst fiscal shape, according to the Mercatus Center.

— Related on ThinkAdvisor:

Ginger Szala

@gingerszalaink

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