State Budget Practice Report Cards and Budget Resource Guide
While Mississippi is the poorest US state in terms of per capita personal income, it nonetheless received average grades of A or B for fiscal 2015 through 2017 in all but one of the five budgetary categories the Volcker Alliance assessed.
Mississippi’s one A average was in budget maneuvers, where for the most part it adhered to best practices of matching current expenditures with current revenues. The state’s B average in legacy costs, including pensions and post-retirement public employee health care, contrasts with lower scores for some neighboring states: Both Alabama and Louisiana got a D, and Arkansas and Georgia earned a C.
In budget forecasting, one of the key building blocks of sound long-term fiscal policy, Mississippi was awarded only a C. That grade reflects the state’s lack of official, detailed multiyear revenue and expenditure forecasts. Its B in reserve funds was the result of Mississippi’s not considering revenue volatility when determining how much to deposit or maintain in the Working Cash Stabilization Fund. Its transparency grade of B reflected a failure to disclose deferred infrastructure replacement costs.
To emphasize the need for clear and comprehensible budgets to inform citizens, promote responsible policymaking, and improve fiscal stability, the Volcker Alliance in 2016 began a study of budgetary and financial reporting practices of all fifty states. The Volcker Alliance’s mission is to improve the effectiveness of the administration of government at all levels. Making state budgeting more transparent and accountable is an important part of that goal.
The report cards found here contain grades of the state's budgetary practices during the fiscal years of 2015 through 2017. Each state received marks in five critical categories, based on their adherence to best practices in several key budgeting indicators. The five categories covered methods used to achieve budgetary balance as well as how budgets and other financial information are disclosed to the public.
States received grades of A to D-minus (there are no “failed states”) for their procedures in estimating revenues and expenditures; their use of one-time actions to balance budgets; how they oversee and use rainy day funds and other fiscal reserves; the adequacy of their funding of public worker retirement and other postemployment benefits; and the quality of transparency of budget and related financial information. The grades are based on research conducted by public finance and budgeting professors and students at eleven US schools of public administration or policy. The universities’ research efforts were augmented by Volcker Alliance staff, data consultants at Municipal Market Analytics, and special project consultants Katherine Barrett and Richard Greene.
State Budget Sources
State Budget Sources: An Annotated Guide to State Budgets, Financial Reports, and Fiscal Analyses is a resource published by the Volcker Alliance designed to help public officials, policy advocates, journalists, academics, and concerned citizens fully understand the critical fiscal decisions that governors and legislators must make. The guide includes the links below to budgets for this state as well as legislative analyses of budget bills and treasurers’ or comptrollers’ monthly state cash-flow statements; capital spending plans; reports on public-worker pension funding and returns; and reports by local and national fiscal research organizations, bond rating firms, and associations of state fiscal and finance officials.