The Best and Worst Run States in America: A Survey of All 50
11. South Dakota
> Debt per capita: $3,773 (19th highest)
> 2015 Unemployment rate: 3.1% (3rd lowest)
> Credit rating: Aaa/AAA
> Poverty: 13.7% (24th lowest)
The South Dakota government appears to have a better-managed budget better than nearly any other U.S. state. South Dakota has the most well-funded pension in the country, with funding exceeding pension obligations by 7.3%. The state’s surplus coffers comprise 9.0% of the current annual budget, one of the larger rainy day funds nationwide. Credit ratings agency Moody’s has given South Dakota the highest possible credit rating and a stable outlook. State lawmakers managed to produce a balanced budget despite collecting less revenue than public officials had projected. According to the state’s chief economist, one reason for the low revenue figure was the increased popularity of online shopping. Increased online shopping redirects revenue from brick-and-mortar retailers in the state to retailers in other parts of the country, ultimately decreasing tax revenue for South Dakota.
> Debt per capita: $5,886 (8th highest)
> 2015 Unemployment rate: 3.6% (6th lowest)
> Credit rating: Aa1/AA+
> Poverty: 10.6% (7th lowest)
Hawaii is one of the most expensive states to live in. Goods and services cost about 17% more than they do on average across the United States. As is often the case in parts of the country that require higher incomes to offset the higher cost of living, Hawaii is home to one of the most affluent populations in the country. The typical household earns $73,486 a year, second most in the country.
The state’s high incomes likely lead to high tax revenue. Hawaii’s tax revenue of $4,214 per capita in fiscal 2014 was fifth highest of any state. However, even with substantial tax revenues, the state has only funded about 64% of its total pension obligations, less than in the majority of states. As of the current fiscal year, the state’s accumulated rainy day fund only amounts to 2.8% of the state’s budget, less than half the average across all states.
> Debt per capita: $5,660 (9th highest)
> 2015 Unemployment rate: 4.9% (tied-21st lowest)
> Credit rating: Aaa/AAA
> Poverty: 12.4% (18th lowest)
The Delaware population increased by 3.4% from net migration over the last five years, twice the corresponding national growth rate. The state of Delaware’s economy may be one attraction to incoming residents. Delaware’s GDP of $63,463 per capita is the fifth highest in the country, and export revenue of $5,712 per capita is the seventh highest. State lawmakers have fostered foreign and domestic investment through corporate-friendly tax laws and an easy incorporation process. According to the state, more than half of all U.S. publicly traded companies are incorporated in Delaware. Close to one in 10 members of the Delaware workforce are employed in the finance, insurance, and real estate industry, the largest share of any state.
Delaware is also very well-positioned to meet its pension obligations. The state’s pension is 92.4% funded compared to the 74.8% average across all states.
> Debt per capita: $5,257 (10th highest)
> 2015 Unemployment rate: 3.7% (tied-7th lowest)
> Credit rating: Aaa/AA+
> Poverty: 10.2% (tied-3rd lowest)
Vermont’s housing market is doing well, and residents are far less likely than people in most states to fall into poverty. Just 1 in every 605 state homes are in foreclosure, the fifth lowest foreclosure rate of all states. By contrast, 1 in every 122 housing units nationwide are in foreclosure. And while close to 15% of people nationwide live in poverty, 10.2% of Vermonters earn incomes below the poverty line, tied for third lowest of all states. Vermont also has the lowest incidence of crime in the nation. The 2015 violent and property crime rates, at 118 and 1,406 incidents reported per 100,000 people, are each the lowest of all states.
With an unemployment rate of 3.7% last year, Vermont’s job market is also in relatively good shape. However, while low unemployment often points to a growing population and job market, Vermont has been losing residents to other states. The state’s labor force contracted by 3.8% in the last five years, nearly the largest decline of all states.
> Debt per capita: $2,179 (13th lowest)
> 2015 Unemployment rate: 4.1% (11th lowest)
> Credit rating: Aa1/AA+
> Poverty: 15.1% (20th highest)
There are more than two children younger than 18 for every five working-age adults in Idaho, the second highest child dependency ratio in the country. This means there are fewer residents earning wages — and more children to educate. Idaho is also fairly rural, which can further strain a state’s ability to educate its children through added transportation costs. Idaho’s education system demands more resources than in many other states. While the state’s education budget accounts for 31.7% of total spending, slightly more than is typical across the nation, this expenditure is equal to just $6,621 per student, the second least of any state.
Idaho lawmakers have managed some components of the budget quite well. The state pension system is 95.2% funded, far more than the 74.8% average across all states. Additionally, the state’s debt totals just $2,179 per resident, roughly $1,400 less than the average across states.