FW Rank: 30

1992 Rank: 26

Population: 2.4 million

Moody's bond rating: Aa

Standard & Poor's bond rating: AA

Governor: Jim Guy Tucker, Democrat

Legislature: Democratic majority in House and Senate

-- Ranking pluses: Genuine efforts at quality management; responsible budgeting dictated by stringent cost control policies; high degree of accountability in education; good revenue estimates; very well funded pensions.

-- Ranking minuses: Long-range planning limited to next biennium; some underestimation of Medicaid expenditures; work needed in performance measurements; no audit yet of any statewide financial statement; first audited comprehensive annual report not expected until fiscal 1994.

-- General comments: The President's home state is mulling over ways to capitalize on its new stature. "We're on the map," says one civic leader. More money likely to go to economic development spending - particularly for infrastructure improvements. New governor Jim Guy Tucker is quicker to make decision than his predecessor, and less prone to compromise. His first act as governor was to deal with the state's Medicaid shortfall, calling a special legislative session that increased taxes. Now his emphasis is on raising fees at a variety of agencies. Significant prison-building costs, with nonviolent offenders housed in community-based centers. Reform of workers' compensation and development of a state civil rights statute are also on the agenda, but time is getting short. In November voters passed term limitations of six years for the state general assembly and eight years for the senate. Though measure is being challenged in court, up to 85% of legislators may be out of a job after the current session.

Source: "The State of the States," Financial World Magazine, May 11, 1993 (Vol. 161, No. 10); New York, NY.