#15 | Ranking the States by Fiscal Condition: Missouri

Summary

On the basis of its solvency in five separate categories, Missouri ranks 15th among the US states for fiscal health. Missouri has between 1.97 and 3.72 times the cash needed to cover short-term obligations. Revenues exceed expenses by 3 percent, with an improving net position of $108 per capita. In the long run, a net asset ratio of –0.01 indicates that Missouri does not have any assets remaining after debts have been paid. Long-term liabilities are lower than the national average, at 26 percent of total assets, or $1,809 per capita. Total unfunded pension liabilities that are guaranteed to be paid are $114.25 billion, or 43 percent of state personal income. OPEB are $3.18 billion, or 1 percent of state personal income.

Key Terms

• Cash solvency measures whether a state has enough cash to cover its short-term bills, which include accounts payable, vouchers, warrants, and short-term debt. (Missouri ranks 14th.)
• Budget solvency measures whether a state can cover its fiscal year spending using current revenues. Did it run a shortfall during the year? (Missouri ranks 26th.)
• Long-run solvency measures whether a state has a hedge against large long-term liabilities. Are enough assets available to cushion the state from potential shocks or long-term fiscal risks? (Missouri ranks 15th.)
• Service-level solvency measures how high taxes, revenues, and spending are when compared to state personal income. Do states have enough “fiscal slack”? If spending commitments demand more revenues, are states in a good position to increase taxes without harming the economy? Is spending high or low relative to the tax base? (Missouri ranks 8th.)
• Trust fund solvency measures how much debt a state has. How large are unfunded pension liabilities and OPEB liabilities compared to the state personal income? (Missouri ranks 33rd.)

For a complete explanation of the methodology used to calculate Missouri's fiscal health rankings, download the full paper and the dataset at mercatus.org/statefiscalrankings.

To read all our work on Missouri, go to mercatus.org/states/missouri.