Mercatus: PA 41st in Fiscal Health

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The Mercatus Center at George Mason University has issued its report on the fiscal health of the 50 states. Here are this year’s Top 10 and Bottom 10 rankings:

1. Alaska
2. North Dakota
3. South Dakota
4. Nebraska
5. Florida
6. Wyoming
7. Ohio
8. Tennessee
9. Oklahoma
10. Montana

Bottom Ten:
50. Illinois
49. New Jersey
48. Mass.
47. Conn.
46. New York
45. Kentucky
44. California
43. West Virginia
42. Maine
41. Penn.

About the author:
Eileen Norcross is a senior research fellow with the Mercatus Center at George Mason University and director of its State and Local Policy Project. Pennsylvania Ranks 41st in Fiscal Health
Comprehensive rankings expose Keystone State’s financial picture

As Pennsylvania begins its new fiscal year, the Mercatus Center at George Mason University has released a new study ranking the state 41st in the nation for its financial health.

The rankings are based on five categories compiled from 2013 financial reports (the latest year for which every state’s numbers are available):
Cash Solvency: 45 of 50

Does a state have enough cash on hand to cover its short-term bills?
Budget Solvency: 39 of 50

Can a state cover its fiscal year spending with current revenues? Does it have a budget shortfall?

Long-Run Solvency: 36 of 50

Can a state meet its long-term spending commitments? Will there be enough money to cushion it from economic shocks or other long-term fiscal risks?
Service-Level Solvency: 17 of 50

How much fiscal "slack" does a state have to increase spending should citizens demand more services?

Trust Fund Solvency: 26 of 50

How much debt does a state have? How large are its unfunded pension and health care liabilities?

"These rankings are an early warning system for policymakers, journalists, and the public," said the study’s author, Mercatus Senior Research Fellow Eileen Norcross. "While no rankings can capture all of the dynamics behind a state’s fiscal situation, these are a tool to guard against short- and long-term risks or economic shocks."