view looking up to rotunda of California capital building in Sacramento
Project

State Fiscal Health

When states manage their finances effectively, they are more likely to have money to invest in priorities such as schools, health care, and infrastructure. When they don’t, they may be forced to cut spending and raise taxes to pay off long-standing expenses and provide basic services to citizens.

To help states manage uncertainty, adapt quickly when crises arise, and ensure that their budgets are balanced over the long term, The Pew Charitable Trusts provides data, analysis, and guidance to policymakers on a range of fiscal and economic issues. We also aid states as they design, evaluate, and improve business tax incentives and other economic development programs to ensure that these programs are cost-effective, helping businesses grow and workers thrive. Through research and advocacy, we help states identify potential policy approaches and make informed choices about what works best for their communities.

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.

Deadwood, South Dakota
Deadwood, South Dakota
Issue Brief

Local Tax Limitations Can Hamper Fiscal Stability

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Issue Brief

Tax limitations can create daunting challenges for cities and counties as they try to balance their budgets while maintaining the level of services their residents expect in the long term. And evaluating if and how states’ tax limitations impede the ability of local officials to manage their finances and provide services effectively is a key first step. Policymakers can then take the appropriate measures to ensure that local governments have the necessary tools to weather unexpected budget crises and strengthen their fiscal health into the future.

100 us dollar bill
100 us dollar bill
Article

States Use Cost-Benefit Analysis to Evaluate Tax Incentives

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Article

Policymakers expect tax incentive evaluations to provide detailed information about how the programs they have enacted affect their states and their residents. Cost-benefit analyses can help evaluators estimate an incentive’s fiscal and economic impact while also considering the degree to which business decisions may have been influenced by the available incentives.

LAS VEGAS, NEVADA - SEPTEMBER 09: UNLV Department of Criminal Justice chairman and professor Dr. Joel Lieberman teaches Jury Decision Making, a criminal justice class at UNLV, amid the spread of the coronavirus (COVID-19) on September 9, 2020 in Las Vegas, Nevada.
LAS VEGAS, NEVADA - SEPTEMBER 09: UNLV Department of Criminal Justice chairman and professor Dr. Joel Lieberman teaches Jury Decision Making, a criminal justice class at UNLV, amid the spread of the coronavirus (COVID-19) on September 9, 2020 in Las Vegas, Nevada.
Article

American Rescue Plan Dollars Will Stretch by State

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Article

State governments are beginning to receive the first allocations from $193.5 billion in American Rescue Plan Act (ARPA) funds, which they can deploy for a wide range of uses as they contend with fallout from the COVID-19 pandemic.

How states raise their tax dollars
How states raise their tax dollars
Data Visualization

How States Raise Their Tax Dollars, FY 2020

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Data Visualization

Taxes make up about half of state government revenue, with two-thirds of states’ total tax dollars coming from levies on personal income (36.5%) and general sales of goods and services (32.2%).

Our Work

How states raise their tax dollars
How states raise their tax dollars
Data Visualization

How States Raise Their Tax Dollars, FY 2020

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Data Visualization

Taxes make up about half of state government revenue, with two-thirds of states’ total tax dollars coming from levies on personal income (36.5%) and general sales of goods and services (32.2%).

Where States Get Their Money, FY 2019
Where States Get Their Money, FY 2019
Data Visualization

Where States Get Their Money, FY 2019

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Data Visualization

Taxes and federal funds together account for 80.5% of revenue for the 50 states. Taxes are the largest revenue source in 46 states, while federal funds are greatest in four: Alaska, Louisiana, Montana, and Wyoming.

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Data Visualization

Fiscal 50

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Data Visualization

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.