Mountain West states climb into Top 10 for fiscal health

The Mountain West continues to score high rankings for good budget practices. Montana, Idaho, and Wyoming – placed among the Top 10 states nationally for fiscal health in the 2025 Financial State of the States report released by Truth in Accounting. Wyoming ranked 3rd, Montana ranked 8th, and Idaho ranked 10th within the nation’s top tier of fiscally stable states. Washington was a disappointing 31st. 

The report evaluates states based on whether they have enough money to pay their bills, including long-term obligations such as pensions and debt. These placements reflect a growing regional trend toward balanced budgets, debt reduction, and long-term fiscal restraint that now distinguishes the Mountain West from many higher-spending states elsewhere in the country. 

Wyoming has consistently ranked among the top three states nationally for fiscal health over the past four years. Wyoming has remained in the top tier largely due to its consistently strong reserve balances and relatively low long-term debt obligations. Governor Gordon has supported this with resource-driven revenues, which together reduce fiscal pressure on the state’s long-term balance sheet.

Idaho ranked 8th in 2021, and actually dropped two places over the last four years. The slight movement in rankings reflects not a deterioration in fiscal health, but modest relative shifts as other states, such as Montana, improved their balance sheets. Idaho has continued to perform strongly due to consistent budget discipline and relatively low liabilities.

Montana’s rise is particularly dramatic, climbing from 22nd place in 2021 to 8th in 2025. This is one of the largest improvements in the nation over the past four years. Since taking office, Governor Gianforte has pursued a governing strategy centered on lowering taxes and reducing debt in the financial realm of Montana. 

In 2023, Montana eliminated its general obligation debt entirely, becoming debt-free and projected to save taxpayers roughly $40 million over two years. The administration also enacted the largest tax cut in state history, delivering hundreds of millions in permanent income tax relief and property tax reductions.

At the same time, Montana strengthened its Budget Stabilization Fund, growing the state’s reserves from 4.5 percent of expenditures in 2023 to roughly 16 percent in the current biennium. State spending growth during the 2025 legislative session was held below 1 percent, which is below the rate of inflation. The result has been a dramatic improvement in Montana’s fiscal standing, jumping 14 spots over four years.

The broader significance of these rankings extends beyond accounting metrics. Barriers such as resource-driven economies, large swaths of federally owned lands in the states, population growth pressures, infrastructure demands, and volatility in energy markets make long-term budgeting particularly critical for the Mountain West.

Throughout the United States, fiscal health has become increasingly tied to economic competitiveness. The Mountain West has attracted significant migration and investment over the past decade, in part because of lower tax burdens. States that maintain balanced budgets and strong reserve funds are often better positioned to avoid sudden tax increases during periods of instability, therefore having higher fiscal health.

The contrast with many East Coast or West Coast states (like Washington) has become more pronounced in recent years. While several large states continue struggling with structural deficits and rising debt obligations, many Mountain West states have prioritized limiting spending growth and building rainy-day reserves. The result is a growing perception that the region offers not only a lower cost of living but also a more sustainable fiscal model. 

For Montana, Idaho, and Wyoming – the 2025 rankings reinforce the idea that fiscal conservatism is no longer simply a political slogan in the region, but a defining component of economic strategy and regional identity. It’s also a reminder for Washington of the important fiscal reforms needed.

Montana, specifically with its surge upwards in rankings, provides a clear example of what sustained budget discipline, debt reduction, and tax policy alignment can produce when applied over multiple years of governance.