July 11, 2017

#5 | Ranking the States by Fiscal Condition: Wyoming

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Summary

On the basis of its fiscal solvency in five separate categories, Wyoming is ranked 5th among the US states for fiscal health. On a short-run basis, Wyoming has between 6.44 and 7.13 times the cash needed to cover short-term obligations. Revenues exceed expenses by 11 percent, and net position improved by $858 per capita in FY 2015. On a long-run basis, net assets are 72 percent of total assets. Long-term liabilities are 10 percent of total assets, or $4,136 per capita. Total primary government debt is $3 million, or $45 per capita. Wyoming’s favorable ranking for long-run solvency is offset by its low ranking for trust fund solvency. Unfunded pension obligations, on a guaranteed-to-be-paid basis, are $12.92 billion, or 40 percent of state personal income. OPEB is 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 5th.)
  • 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 2nd.)
  • 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 6th.)
  • 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 42nd.)
  • 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