The state of Wyoming has been receiving praise lately regarding the state’s excellent fiscal situation. Something that remains relatively rare even a long decade after the Great Recession that emptied many state budgets around the nation. A financial watchdog group recently gave Wyoming a sterling grade in its review of the state’s fiscal situation. It noted that future debt payments will be more manageable as a result of the surplus.
Here’s a breakdown of the recent fiscal praise given to Wyoming, and why the state has enjoyed such tranquil financial waters lately.
Wyoming scored an “A”
According to a recent report issued by Truth in Accounting (TIA), a conservative fiscal watchdog that monitors state budget surpluses, Wyoming has one of the greatest “taxpayer surpluses” in the nation. TIA considers a “taxpayer surplus” to be the amount of money left over after all of a state’s outstanding debt is paid off. In the case of Wyoming, the state would still have $20,800 per taxpayer if it paid off all of its bills, according to the report.
The report illustrates that Wyoming and Alaska benefits tremendously from the energy-intensive industries across the state, which generate vast sums of money despite its relatively scant population. With relatively few citizens living there, states such as Wyoming and Alaska have a far easier time managing their fiscal budgets than populous states such as New Jersey or Illinois, two states at the bottom of the list.
Other analyses have reinforced the idea that Wyoming’s sterling fiscal situation is envious compared to that of other states in the union. Wyoming is generally considered to be very capable of paying for its short-term expenses, for instance, a metric that is frequently relied upon when gauging the fiscal status of a state. According to the TIA report, Wyoming has about $4 billion available to pay for future bills.
Making sense of the ratings
Other states which received “F” ratings, such as New York, were rated lower because they have substantially more citizens, ensuring that greater unfunded retirement obligations and other bills that must be paid in the future stymie their ranking. With fewer people and thus fewer employees, states such as Alaska and Wyoming are facing far more comfortable fiscal futures.
TIA’s rating should exclusively be considered in the fiscal context, as they don’t pertain to overall economic vibrancy. For instance, New York has $140 billion available compared to Wyoming’s $4 billion, but whereas New Yorkers face $276.6 billion in bills. Wyomingites need only fret about $8.3 billion in bills.
Family companies may nevertheless find Wyoming to be a secure place to set up shop in given the fiscal reliability of the state. Wyoming’s thriving energy sector isn’t likely to fade anytime soon. Popular tourist destinations such as Jackson Hole continue to draw in visitors from around the world. All in all, the fiscal situation in the Equality State is looking brighter by the day.