In an era of heightened economic uncertainty, state governments are facing unpredictable revenue as well as rising health care, education, and infrastructure costs. How policymakers choose to confront these challenges will affect states and the nation for years to come. Through both research and advocacy, Pew provides data, analysis, and guidance to help states navigate these fiscal challenges and identify potential policy approaches.
Our research—including 50-state assessments—examines key trends in state finances and evaluates states on their performance, underscoring effective approaches and creating an environment for potential reform.
We collaborate with policy leaders in states in a variety of ways:
Research: We conduct comprehensive and policy-relevant research. Our findings give states evidence-based options to address their unique fiscal challenges.
Information sharing: We serve as a resource to policymakers making research-driven decisions to improve fiscal outcomes in their states. We lead webinars, events, and meetings and provide communications assistance to encourage state, regional, and national conversations on budget policies and practices.
Technical assistance and policy advocacy: We provide strategic technical assistance to states seeking to improve their budget practices. Our capabilities encompass policy design, including state comparative analysis; drafting or advising on legislation; offering testimony; and supplying other assistance, as requested.
Through these strategies, our goal is to help policymakers manage economic and revenue volatility, enhance transparency, and improve their states’ fiscal health over the long term.
Credit ratings are critically important for state governments. A low rating may suggest to investors that a state is more likely to default on the debt it issues. That makes it more costly for a state to borrow money and adds strain to its budget. A robust rainy day fund, however, can have a significant positive impact on a state’s credit rating.
As Congress considers whether to provide state governments with additional fiscal aid in the wake of COVID-19, it is important to recognize that many states made significant strides over the past decade to prepare for a recession.
The recession caused by the coronavirus pandemic is hammering state tax collections and putting pressure on budgets nationwide. In addition to the immediate financial challenges, states face considerable uncertainty about the future.
Fiscal 50: State Trends and Analysis, an interactive resource from The Pew Charitable Trusts, allows you to sort and analyze data on key fiscal, economic, and demographic trends in the 50 states and understand their impact on states’ fiscal health.
Taxes and federal funds together account for 81% of revenue for the 50 states. Taxes are the largest revenue source in 44 states, while federal funds are greatest in six: Alaska, Louisiana, Mississippi, Montana, New Mexico, and Wyoming. This infographic displays a breakdown of each state’s revenue by major categories.
Taxes make up about half of state government revenue, with two-thirds of states’ total tax dollars coming from levies on personal income and general sales of goods and services. This infographic illustrates the sources of each state’s tax revenue.
