Hawaii ranks 40th among states for its overall “fiscal health,” according to a national study by the Mercatus Center at George Mason University.

The study, released Tuesday, measured fiscal solvency of the 50 states based on short- and long-term debt and other “key fiscal obligations,” such as unfunded pensions and health care benefits.

Alaska, flush with oil tax revenues, topped the ranking, while the fiscal fitness of Illinois, mired in a massive pension crisis, was deemed the worst.


George Mason University

Here’s how Hawaii ranks in the five key categories:

Cash solvency: 25th. Cash solvency measures whether a state has enough cash to cover its short-term bills.

Budget solvency: 30th. Budget solvency measures whether a state can cover its fiscal year spending out of current revenues.

Long-run solvency: 42nd. Long-run solvency measures whether a state has an adequate hedge against large, long-term liabilities to cushion the state from potential shocks or long-term fiscal risks.

Service-level solvency: 44th. Service-level solvency measures how high taxes, revenues, and spending are when compared to state personal income.

Trust fund solvency: 43rd. Trust fund solvency measures how much debt a state has in areas such as unfunded pension liabilities, and “other postemployment benefits,” as well as state debt compared to state residents’ personal income.

The study also noted that Hawaii has total primary government debt of $7.45 billion, far below California’s $123.5 billion. But its per capita amount, at $5,357, is the second highest in the nation — behind only to Connecticut’s $5,481 — and represented 12 percent of the state residents’ personal income in fiscal year 2013, the highest in the nation.

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