Connecticut and New York were ranked among the states in the worst financial health to combat crises, according to the new 2020 Financial State of the States report published by Truth in Accounting (TIA), a nonpartisan think tank.
The new report determined that 39 of the 50 states lacked the funds to pay all of their bills, with the total debt among all states amounting to $1.4 trillion by the end of fiscal year 2019. Although 11 states had some money set aside when the Covid-19 pandemic began, the ongoing crisis is projected to result in a combined revenue loss of $397 billion.
Connecticut ranked 48th in the TIA report, which noted that it “went into the coronavirus pandemic in dire fiscal health, and it will probably come out of the crisis even worse.” The report predicted that Connecticut will lose $8 billion in revenue as a result of the crisis and warned that the state will need to collect “$50,700 from each of its taxpayers to pay all of its bills.”
New York ranked 41st in the report, which blamed elected officials for “repeated financial decisions that left the state with a debt burden of $118.2 billion. That burden equates to $17,200 for every state taxpayer.”
Complicating matters, the report continued, were unfunded retirement obligations that accumulated over the years.
“Of the $241.2 billion in retirement benefits promised, the state did not fund $12.5 billion in pension and $88.5 billion in retiree health care benefits,” the report said, adding that “New York is projected to lose $32 billion in revenue as a result of this crisis. The uncertainty surrounding this crisis makes it impossible to determine how much will be needed to maintain government services and benefits, but New York”™s overall debt will most likely increase.”
TIA ranked Alaska as the state in the best financial health and New Jersey as being in the worst fiscal shape.
