Study Finds Virginia Clean, Maryland Shows Fiscal Strain in Local Governments

Using audited fiscal 2023 statements, the Reason Foundation evaluated debt, cash reserves, revenue-spending gaps and per-resident or per-student liabilities across more than 20,000 state and local bodies. Virginia emerged as one of 23 states with no state-level red flags, though local jurisdictions like Fairfax County (two flags) and large school districts such as Chesterfield County Public Schools (three flags) showed pressure.

Maryland logged a single state warning related to its unrestricted net position, but Baltimore County and Prince George’s County each earned four flags, and the city of Baltimore received five, reflecting liabilities exceeding twice its annual revenue. School districts varied widely; Prince George’s County Public Schools logged four flags, while Baltimore City Public Schools was among only two of the nation’s 100 largest districts to avoid any warnings. Researchers cautioned that a red flag does not automatically signal a crisis, but highlights areas needing closer scrutiny.