Lawmakers approve a balanced state budget every year, but a new report said Georgia still faces $3,600 per taxpayer in debt, mostly to pay for retirement benefits for ex- teachers and state employees.
That’s an improvement from 2015, when the state debt was calculated at $4,500 per taxpayer.
The annual report by the financial think tank Truth in Accounting gave Georgia a financial grade of C, ranking Georgia 18th among the states.
The lowest-ranked was New Jersey, with a debt of $67,200 per taxpayer.
Most states require lawmakers to pass balanced budgets each year. But most of the debt TIA studied is not accounted for in those budgets.
The group said much of the debt is in pension and retiree health care obligations. Typically states don’t set aside enough money to pay all the benefits owed to future retirees.
“Most people are unaware of the fact that their state governments are allowed to promise money that they don’t actually have,” said Sheila Weinberg, CEO of Truth in Accounting. “It a widespread problem and running up these obligations is like the government putting this debt on taxpayer credit cards.”
Such debt impacts the ability of states to pay for things like road and school improvements.
Georgia’s ranking has improved from 27th in 2015. Lawmakers put an extra $200 million into this year’s budget to help improve the financial stability of the Teacher Retirement System, and are likely to plug another $350 million or so into TRS next year.