Pennsylvania is famous for its potholes, but it has an even bigger sinkhole problem that could cost taxpayers way more than minor car repairs caused by pock-marked roads.
Truth in Accounting, an economic think tank based in Chicago, released its Fiscal Year 2013 State of the States Report last week. It determined Pennsylvania is a "sinkhole state," meaning it's "sinking in debt."
While the Keystone State owns $38.9 billion in available assets, it owes more than $100 billion, the report says. That makes for $62 billion in obligations, which have been pushed toward the future.
To pay that debt off today, every taxpayer would have to pony up $14,500 - enough to send a Pennsylvania resident to a state university for two years and leave him or her with some beer money, too. It's the 14th-worst figure in the U.S.
"One of the reasons Pennsylvania is in this precarious financial position is state officials use antiquated budgeting and accounting rules to report Pennsylvania's financial condition," the report says.
Truth In Accounting started by examining the federal fiscal situation but eventually realized states weren't exactly truthful
on their financial statements.
"We were like, 'Oh, my God, these elected officials are making decisions about the finances of the state and the budget based upon misleading information,'" said Sheila Weinberg, founder and CEO of Truth
That led to the State of the States Report, which found that Pennsylvania has $53.8 billion in retirement benefits that have been promised but not funded. Just $3.2 billion of that showed up on the state's balance sheet, according to Truth in Accounting.
More than 50 percent of the state's bills include promised pension and retiree health care benefits, according to the report.
If the debt isn't addressed, Pennsylvania might sink even further, the report indicated.
"Unless these pension and retirees' health care benefits are renegotiated, future taxpayers will be burdened with paying for these benefits without receiving any corresponding government services or benefits," the report found.