Key materials
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On the basis of its fiscal solvency in five separate categories, Vermont ranks 36th among the US states and Puerto Rico for its fiscal health. On a cash basis, Vermont has between 1.28 and 2.23 times the cash needed to cover short-term liabilities. Revenues exceed expenses by 3 percent, for a surplus of $269 per capita. On a long-run basis, Vermont has a negative net asset ratio of −0.03, and total liabilities are 38 percent of total assets. Total debt is $595 million. Unfunded pension liabilities are $4.48 billion on a guaranteed-to-be-paid basis, and other postemployment benefits (OPEB) are $1.84 billion. These three liabilities are equal to 23 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. (Vermont ranks 30th.)
  • Budget solvency measures whether a state can cover its fiscal year spending using current revenues. Did it run a shortfall during the year? (Vermont ranks 27th.)
  • 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? (Vermont ranks 34th.)
  • 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? (Vermont ranks 47th.)
  • 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? (Vermont ranks 6th.) 

For a complete explanation of the methodology used to calculate Vermont's fiscal health rankings, download the full paper and the dataset at