Fifty States in Fifty Weeks: Rhode Island
Each week this year (with the exception of Thanksgiving and Christmas) we will examine the fiscal and economic health of one of the U.S. states. Our ninth state in this series is Rhode Island. Here are the top five things (or more) you need to know about the Ocean State:
- Rhode Island has one of the worst S&P bond ratings in the country. (The state is at AA status.) A bad bond rating raises the cost of borrowing; Rhode Island’s borrowing costs are 47th (from best to worst) in the nation.
- Rhode Island is a place of extremes: it has the longest official name of any state (the “State of Rhode Island and Providence Plantations”), the shortest state motto (“hope”) and, at 10.2 percent, is tied for the highest unemployment rate among the U.S. states.
- The American Legislative Exchange Council ranks each state’s economic outlook. Rhode Island ranked 43rd (50th being the worst) in 2012, a slight improvement from 2011. Here are a couple possible reasons: the state spends $7,420 per resident, ranking it 9th (from highest to lowest) in the nation and takes in $2,604 in total revenue per capita, the 18th-highest rate in the nation.
- Rhode Island is the smallest state in the union – if the U.S. was divided into states Rhode Island’s size, there would be 3,874 states – but has big pension problems. The state worker pension system is only 49 percent funded, one of the worst showings in the nation. Its state worker health care program is zero percent funded (the national average is eight percent). The state has $14.2 billion in liabilities, but is $8 billion short of cash. This situation persists despite the fact that the state generally makes its full annual pension contribution.
- One way Rhode Island saves taxpayer money? It is one of only six U.S. states that do not have an official residence for its governor.