Every year, the non-profit organization Truth in Accounting publishes its Financial State of the States report, which evaluates the fiscal health of all 50 states based on their latest financial data. The 2024 report is a thorough, data-driven analysis that digs into state-level financial reports and calculates how much debt or surplus each state holds relative to the number of taxpayers. Known for its objectivity and transparency, the report reveals the stark truth about whether state governments are being good stewards of taxpayer dollars—or if they are recklessly piling on debt.
The Financial State of the States 2024 report assesses each state’s financial position using a key metric called the “Taxpayer Burden™” or “Taxpayer Surplus™.” This figure is determined by comparing total state assets with total bills and dividing the result by the number of state taxpayers. States that have enough assets to cover their debts receive a surplus score, while those that don’t end up with a burden, reflecting the additional cost that each taxpayer would need to pay to erase the state’s liabilities. The report is clear-cut: if a state’s expenses are greater than its revenues, it’s in trouble, and that trouble ultimately falls on the backs of taxpayers.
According to the 2024 report, Texas ranks a disappointing 26th out of 50 states and has received a C grade for its fiscal health. This is an unacceptable performance for a state that should be leading the nation in fiscal responsibility. A C grade might sound like a passing mark, but it’s a clear indicator that Texas has serious issues with its financial management. It’s a stark reminder that our lawmakers are not living up to their promises of fiscal prudence.
Texas ended the 2023 fiscal year with a Taxpayer Burden™ of $900 per taxpayer, signaling that the state doesn’t have enough assets to cover its liabilities. While $900 might seem minor compared to the staggering figures seen in states like Illinois, New Jersey or Connecticut, it’s still a sign that our representatives are engaged in the same kind of reckless spending that has plagued less disciplined states. This shortfall is the result of years of budget mismanagement, poor financial planning, and policies that prioritize immediate political gains over long-term financial health.
The Texas government’s inability to secure a higher ranking is not due to a lack of revenue or resources. Rather, it’s because of irresponsible spending practices, the misallocation of funds, and a refusal to adopt common sense fiscal reforms. For example, the report highlights Texas’ ongoing struggle with unfunded pension liabilities and deferred maintenance costs—financial obligations that have been conveniently left off the books in the name of “balanced” budgets. These hidden debts are nothing short of a betrayal to the taxpayers, who will ultimately be left holding the bag when these bills come due.
Despite maintaining strong Republican majorities in both chambers of the Legislature, State lawmakers have failed to enact meaningful reforms that would protect taxpayers from these growing liabilities. Instead of eliminating wasteful programs, eliminating property taxes, and putting an end to taxpayer-funded lobbying, the state continues to expand its budget to record levels, with the largest spending increase in history in 2023, leaving the door open for future deficits and increased debt burdens.
The findings of the Financial State of the States report are a call to action. Texans for Fiscal Responsibility has long advocated for reforms that would transform Texas into the most prosperous State, where families and small businesses can truly thrive.
The solutions are clear: reforming the budgeting process to prioritize transparency and sustainable spending, imposing spending limits on local governments to curb wasteful expenditures, eliminating corporate welfare programs like Chapter 403’s that divert taxpayer money to wealthy businesses, and banning taxpayer-funded lobbying.
Moreover, Texans deserve immediate and lasting property tax relief. The report shows that Texas could be in a much better position if it adopted a streamlined approach to property taxes, ensuring that everyday Texans are not overburdened. It’s time for our representatives to take this issue seriously and provide a pathway to total property tax elimination.
A C grade is not something to be proud of—it’s a warning sign that Texas is teetering on the edge. State Representatives must understand that continuing down this path will only lead to higher taxes, more debt, and an unsustainable future for taxpayers. If Texas wants to reclaim its position as a leader in fiscal health, we need bold action and transformative policies that put taxpayers first.
The people of Texas must hold their elected officials accountable. We cannot afford to accept mediocrity while other states like Tennessee, North Dakota and Utah secure A grades through disciplined fiscal management. Lawmakers must start adopting transparent, taxpayer-friendly budgeting practices that truly balance the books.
Texans for Fiscal Responsibility will continue to advocate for policies that prioritize fiscal restraint and eliminate wasteful spending. If our representatives take these issues seriously and begin implementing the necessary reforms, there is no reason Texas cannot rise from its C grade to an A. But that can only happen if we, the people, push for real accountability.
Texas has the potential to be a leader in fiscal health, economic opportunity, and true property ownership, but only if it embraces the principles of limited government.
It’s time for our lawmakers to stop making excuses and start making Texas a shining example of fiscal responsibility once again.
For more information and to support our mission, visit texastaxpayers.com. Join us in the fight for a more prosperous and financially responsible Texas.
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