Mercatus Center at George Mason University Study: Florida Leads Nation In Fiscal Health
By Ed Dean & Kevin Derby, Sunshine State News // July 12, 2017
performed well on all dimensions of solvency
SUNSHINESTATENEWS.COM – The Mercatus Center at George Mason University released its rankings of fiscal health of the 50 states and the Sunshine State leads the pack.
On Tuesday, the Mercatus Center unveiled its fourth annual “Ranking the States by Fiscal Condition” from Eileen Norcross and Olivia Gonzalez.
Based on debt and other fiscal issues, including pensions and health-care benefits, Florida topped the list followed by North Dakota, South Dakota, Utah and Wyoming.
New Jersey was at the bottom followed by Illinois, Massachusetts, Kentucky and Maryland. Florida was ranked sixth in last year’s rankings and fifth in 2015.
“On the basis of its fiscal solvency in five separate categories, Florida ranks 1st among the US states for its fiscal health,” the study noted.
“Florida performs well on all dimensions of solvency. On a short-run basis, Florida has between 8.19 and 10.01 times the cash needed to cover short-term obligations.
Revenues exceed expenses by 7 percent, and net position improved by $279 per capita. On a long-run basis, Florida’s performance is also strong.
Net assets are 10 percent of total assets, and long-term liabilities are 34 percent of total assets, or $2,303 per capita, roughly half the average for the US states.
Unfunded pension obligations, on a guaranteed-to-be-paid basis, are $197.65 billion, or 22 percent of state personal income, and OPEB is 2 percent of personal income.”
Florida ranked second in term of cash solvency which the study defines as “enough cash to cover its short-term bills, which include accounts payable, vouchers, warrants, and short-term debt.”
The Sunshine State is tenth in budget solvency which the study classifies as “whether a state can cover its fiscal year spending using current revenues.”
Florida is 17th in long-run solvency which “measures whether a state has a hedge against large long-term liabilities” but it’s third in service-level solvency which “measures how high taxes, revenues, and spending are when compared to state personal income.”
The Sunshine State is eighth in trust fund solvency which “measures how much debt a state has.”
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