Utah

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Summary

On the basis of its fiscal solvency in five separate categories, Utah ranks seventh among the US states and Puerto Rico for its fiscal health. On a cash basis, Utah has between 4.17 and 6.25 times the cash needed to cover short-term liabilities. Revenues exceed expenses by 14 percent, for a surplus of $500 per capita. Net assets are 29 percent of total assets, and total liabilities are 18 percent of total assets. Total debt is $4.90 billion. Unfunded pension liabilities are $29.83 billion on a guaranteed-to-be-paid basis, and other postemployment benefits (OPEB) are $267 million. These three liabilities are equal to 31 percent of total 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. (Utah ranks 6th.)
  • Budget solvency measures whether a state can cover its fiscal year spending using current revenues. Did it run a shortfall during the year? (Utah ranks 5th.)
  • 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? (Utah ranks 16th.)
  • 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? (Utah ranks 12th.)
  • Trust fund solvency measures how much debt a state has. How large are unfunded pension liabilities, OPEB liabilities, and state debt compared to the state personal income? (Utah ranks 26th.)

For a complete explanation of the methodology used to calculate Utah's fiscal health rankings, download the full paper and the dataset at mercatus.org/statefiscalrankings-2016-edition.