FOR IMMEDIATE RELEASE July 21, 2015
Dave Parker, Communications Director, Governor’s Office, 444-9844
Mike Wessler, Deputy Communications Director, Governor’s Office, 444-9725
Specific metrics from the Moody’s report include:
- Ranked 4th best for net tax supported debt per capita at $254; 50 state average is $1,419;
- Ranked 4th best for net tax supported debt as a % of personal income at 0.7%; 50 state average is 3.1%;
- Ranked 3rd best for net tax supported debt at $259,835 (in thousands); 50 state average is $10,191,421 (in thousands); and
- Ranked 4th best for net tax supported debt as a % of state GDP at 0.59%; 50 state average is 2.67%.
“This report is yet another example of why Montana was named the most fiscally prudent state in the nation,” said Bullock. “At a time when other states have serious financial problems, Montanans can be justifiably proud of the fiscal strength of their state.”
About the report:
Basis for state debt medians (From Moody’s Investor Report)
“Moody’s 2015 state debt medians are based on our analysis of calendar year 2014 debt issuance and fiscal year 2014 debt service. As in prior year reports, the presentation of debt trend data incorporates a one-year lag (i.e., the data labeled 2015 reflects debt as of calendar year-end 2014).
In considering debt burden, our focus is largely on net tax-supported debt, which we characterize as debt secured by statewide taxes and other general resources, net of obligations that are self-supporting from pledged sources other than state taxes or operating resources – such as utility or local government revenues. We also examine gross debt, which captures debt supported by revenues
other than state taxes and general resources. This includes self-supporting general obligation (GO) debt, special assessment bonds, and contingent debt liabilities that may not have direct tax support but represent commitments to make debt service payments under certain conditions (e.g., state guarantees and bonds backed by state moral obligation pledges that have never been tapped).
The debt and debt service ratios of some states are relatively high because they issue debt for purposes that in other states would be financed at the local level, such as for schools or mass transit. Some states’ debt service ratios rank higher than their debt ratios due to conservative debt management practices, such as rapid debt amortization. Conversely, some states’ debt service ratios rank relatively lower due to the use of capital appreciation bonds or long maturity schedules.
These ratios have been calculated based on our definition of net tax-supported debt, debt service and operating revenues, and in most cases will differ from a state’s own published calculations of debt limits or debt affordability. There is no correlation between our ratios and a state’s compliance with its internal policies.”
A copy of the full report is attached.