The Best and Worst Run States in America: A Survey of All 50

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36. Arizona
> Debt per capita:
$2,039 (11th lowest)
> Credit rating (S&P/Moody’s): AA/Aa2
> Unemployment rate: 6.1% (6th highest)
> Median household income: $50,068 (21st lowest)
> Poverty rate: 18.2% (10th highest)

Net migration from 2010 through 2014 accounts for 2.6% of Arizona’s population. While Arizona appears to be a popular destination for Americans seeking new homes, it seems unlikely that new residents are choosing the Sun Belt state for its public services. A $9.1 billion budget was recently approved for the coming fiscal year, less than in other states. The new budget cuts, among other things, education spending by about $352.5 million. The downsized budget is part of a two-decade trend of lower taxes and also fewer government services. Arizona collects just $2,001 in taxes per capita, much less than the $2,657 state average.

However, education spending may increase in the coming years from the current relatively small 34% share of total state expenditure. Arizona Governor Doug Ducey recently signed a package of bills that will provide $3.5 billion to the public school system — the settlement of a five-year lawsuit brought against the state by its public schools for underfunding education during the recession.

37. Missouri
> Debt per capita:
$3,184 (24th lowest)
> Credit rating (S&P/Moody’s): AAA/Aaa
> Unemployment rate: 5.0% (25th lowest)
> Median household income: $48,363 (15th lowest)
> Poverty rate: 15.5% (21st highest)

After its legislature introduced spending restrictions to help balance the state budget, Missouri received the highest possible credit rating from both Moody’s and S&P, as well as stable outlooks from both agencies. In Missouri’s balanced budget, low spending is accompanied by low taxes. The state government collects just $1,837 in taxes per capita annually, one of the lowest tax revenues nationwide. Missouri also spends just 2.0% of its total expenditure on government administration, the fifth lowest share nationwide. Low administrative spending contributed to low wages for state government employees, which are some of the lowest in the country. The low wages may also contribute to a higher voluntary turnover rate.

38. Connecticut
> Debt per capita:
$8,996 (3rd highest)
> Credit rating (S&P/Moody’s): AA/Aa3
> Unemployment rate: 5.1% (24th highest)
> Median household income: $70,048 (4th highest)
> Poverty rate: 10.8% (3rd lowest)

Connecticut has one of the most underfunded pension programs in the country — it has enough funds to cover just 48% of all pension obligations. To address the issue, Governor Dannel Malloy has introduced a plan that includes laying off 500 state employees and restructuring the state’s pension program to help meet short-term obligations. The state’s economy is also somewhat stagnant. Despite having some of the wealthiest residents in the country, Connecticut’s GDP growth rate of just 0.6% last year significantly lagged the 2.2% national expansion.

According to a White House report, Connecticut is tied with Rhode Island for the largest share — 41% — of state roads in poor condition. The state spends just 4.5% of its total expenditure on highways, the fifth least in the nation.

39. Maine
> Debt per capita:
$4,041 (14th highest)
> Credit rating (S&P/Moody’s): AA/Aa2
> Unemployment rate: 4.3% (16th lowest)
> Median household income: $49,462 (19th lowest)
> Poverty rate: 14.1% (22nd lowest)

Maine is one of only a handful of states where welfare spending exceeds education spending as a percentage of total expenditure. Each year, the state’s education expenditure equals 25.6% of total spending, the lowest percentage compared with other states. Annual welfare spending, on the other hand, is equal to 36.7% of total spending, the third largest share of any state. While the percentage of adults with a high school degree, at 91.7%, is relatively high, the percentage of people receiving food stamps, at 16.9%, is the sixth largest share nationwide.

Maine Governor Paul LePage, through aggressive tax reforms, has attempted to dramatically restructure the state’s spending apparatus. Numerous attempts to restrict welfare programs were ultimately rejected by concerns over their legality. In the most recent budget, Maine has cut public school funding among other public programs.


40. South Carolina
> Debt per capita:
$3,047 (22nd lowest)
> Credit rating (S&P/Moody’s): AA+/Aaa
> Unemployment rate: 5.6% (14th highest)
> Median household income: $45,238 (9th lowest)
> Poverty rate: 18.0% (11th highest)

South Carolina has some of the lowest tax revenues in the country. It collects just $1,805 per capita in taxes annually, the fifth least of any state government. This may be partially due to its relatively poor residents. The typical household in the state makes just $45,238 a year, one of the lowest median household incomes nationwide. Similarly, 18.0% of the state’s population lives below the poverty line, higher than the 15.5% national poverty rate. However, despite its Republican leadership decrying federal deficit spending, South Carolina’s weak tax base is subsidized heavily by federal funding. It is the most dependent state on federal funding, receiving around $8 from Washington D.C. for every $1 its residents pay in federal taxes. Major subsidies will allow South Carolina to have the largest budget in state history for the coming fiscal year.