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Editorial
Fiscal study puts Nebraska near the top
Thursday, June 2, 2016
Gov. Ricketts has drawn criticism for his opposition to expanding Medicaid and his penchant for treating state government like a business, but his type of fiscal conservatism has placed Nebraska next to the top when it comes to financial health.
Eileen Norcross, a senior research fellow with the Mercatus Center at George Mason University leads its State and Local Policy Project, which seeks to take the mystery out of financial reports.
Using various basic factors such as cash, budget, long-run, service and trust fund solvency, Nebraska ranked second in the United States behind only Alaska.
Puerto Rico ranked at the bottom, just below Connecticut, Massachusettes, New Jersey, Illinois, Kentucky, Hawaii, California, Maine and New York.
Other top states besides Alaska and Nebraska rank, in order,Wyoming, North Dakota, South Dakota, Florida, Utah, Oklahoma, Tennessee, and Montana.
Nebraska ranks first in long-run solvency, meaning it can meet its long-term spending commitments and is prepared for economic shocks or other risks.
It's also first in trust-fund solvency, meaning it has low debt, unfunded pension liabilities and health care obligations.
Other rankings include seventh in service-level solvency, meaning it has enough fiscal "slack" to increase spending if residents demand more services; ninth in cash solvency to cover short-term bills; and 14th in budget solvency -- taking in enough revenue to cover fiscal year spending.
Nebraska's revenues exceed expenses, and total taxes as a proportion of state personal income are 5 percent below the national average.
"You shouldn't have to be a budget expert to know where your state stands financially," Norcross said. "These rankings give everyone that chance by putting complicated annual financial reports into context, while still allowing experts to take a deeper look at the numbers."
Proponents of expanding Medicaid or other programs will probably use the figures to contend that Nebraska can afford to increase spending, and that may be true to a limited extent.
But only by keeping its fiscal house in order can Nebraska hope to keep its options open and avoid more painful decisions later.
Check out the original study here: http://bit.ly/1UwT88O