October 9, 2018

#6 | Ranking the States by Fiscal Condition: Wyoming

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On the basis of its solvency in five separate categories, Wyoming ranks 6th among the US states for fiscal health. Wyoming has between 7.20 and 7.81 times the cash needed to cover short-term obligations, well above the US average. Revenues only cover 93 percent of expenses, with a worsening net position of –$577 per capita. In the long run, Wyoming has a net asset ratio of 0.74. Long-term liabilities are lower than the national average, at 10 percent of total assets, or $3,989 per capita. Total unfunded pension liabilities that are guaranteed to be paid are $15.87 billion, or 49 percent of state personal income. OPEB are $0.24 billion, or 1 percent of state personal income.

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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. (Wyoming ranks 2nd.)
  • Budget solvency measures whether a state can cover its fiscal year spending using current revenues. Did it run a shortfall during the year? (Wyoming ranks 47th.)
  • 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? (Wyoming ranks 7th.)
  • 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? (Wyoming ranks 37th.)
  • 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? (Wyoming ranks 37th.)

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

To read all our work on Wyoming, go to mercatus.org/states/wyoming.