Thursday, July 18, 2024

Report: Each Louisiana resident owes $18,900 to cover state’s debts

by BIZ Magazine

(The Center Square) — According to a new report, Louisianans might need to dig deeper into their couch cushions to fund their share of the state’s debt.

According to the nonpartisan Truth in Accounting’s annual Financial State of the States report, each Louisiana resident owes $18,900 to pay off the state’s debts. The report ranked Louisiana 43rd, saying the state owes $22.8 billion, and gave the state a D grade having a taxpayer burden between $5,000 and $20,000.

The state, according to Truth in Accounting, has $27.4 billion in assets and cash on hand to pay $50.2 billion in bills, including $13.3 billion in bond debt, $10.3 billion in unfunded pension debt and $9.9 billion in unfunded health care costs for state and local retirees.

The report noted a billion dollars in federal COVID-19 relief funds came to the state, and there has been a decline in earnings from the investments of the state’s defined benefit pension fund for state and local employees.

The state’s pension fund might be on more solid ground after voters recently passed a constitutional amendment. This past Saturday, Louisiana voters passed Amendment 3 with 56% in favor, which requires lawmakers to apply 25% of the state’s nonrecurring revenues to the state’s pension debt.

Last year, the report said the individual taxpayer burden for Louisiana was $14,100 and ranked the state 38th.

This year’s report – which uses the state’s comprehensive annual financial reports – says 28 states, down from 31 in 2022, didn’t have enough money to pay their bills.

Regionally, Louisiana is substantially worse than its neighbors. Arkansas taxpayers have a surplus of $500 for a B grade, while Texas (30th, $4,300 individual taxpayer burden, C grade) and Mississippi (33rd, $7,900 individual taxpayer burden, D grade) substantially outperformed the Pelican State.

Nationally, the five worst states – called Sinkhole States by Truth in Accounting – were Hawaii ($23,100 individual taxpayer burden), Massachusetts ($26,700 individual taxpayer burden), Illinois ($41,600 individual taxpayer burden), Connecticut ($50,700 individual taxpayer burden) and New Jersey ($53,600 individual taxpayer burden).

The five best Sunshine States were Alaska ($80,000 taxpayer surplus), North Dakota ($47,400 taxpayer surplus), Wyoming ($24,600 taxpayer surplus), Utah ($12,700 taxpayer surplus) and Tennessee ($9,500 taxpayer surplus).

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