US governors ranked on fiscal policy. How did Florida Gov. DeSantis fare?

The results are in.

The Cato Institute has released its “Fiscal Policy Report Card” for 2024, examining governors across the state to see how well they’ve handled their respective state’s finances.

According to the study, researchers looked at state budget actions since 2022 to help determine the report’s findings, grading governors on a scale of “A” - “F.”

“It uses statistical data to grade the governors on their tax and spending records: Governors who restrained taxes and spending received higher grades, while governors who substantially increased taxes and spending received lower grades,” the study reads.

While the results of the study are “data driven,” the Cato Institute states, they only account for tax and spending actions that impact short-term budgets in each state — not longer-term or structural changes that some governors may make, such as reforms to pension plans.

“Thus, the results provide one measure of how fiscally conservative each governor is, but they do not reflect all the fiscal actions that governors take,” the report continues.

The report shows that only six governors actually scored an “A” on the report card. They were as follows:

• No. 1 — Iowa Gov. Kim Reynolds (81%)

“Kim Reynolds of Iowa has been a lean budgeter and dedicated tax reformer since entering office in 2017. She received the highest score on this report. Iowa general fund spending has risen at just 2.3 percent annually since Reynolds took office. She has greatly simplified and reduced Iowa’s income taxes. The individual income tax was converted from a nine-bracket system with a top rate of 8.98 percent to a 3.8 percent flat tax; the corporate tax rate was slashed from 9.8 percent to 5.5 percent. The governor also approved school choice reforms allowing all students to opt for education savings accounts (ESAs) to cover private schooling costs.”

Cato Institute, "Fiscal Policy Report Card on America's Governors 2024"

• No. 2 — Nebraska Gov. Jim Pillen (77%)

“Jim Pillen of Nebraska is a veterinarian and entrepreneur elected governor in 2022. He cut the corporate tax rate and top individual income tax rate from a planned 5.84 percent to 3.99 percent, to be phased in by 2027. He also ended taxes on Social Security benefits, allowed businesses to expense their equipment purchases, and achieved major property tax reductions.”

Cato Institute, "Fiscal Policy Report Card on America's Governors 2024"

• No. 3 — West Virginia Gov. Jim Justice (71%)

“Jim Justice of West Virginia is a wealthy entrepreneur elected governor in 2016. For years, he pushed to cut the income tax to increase growth and attract residents to his state. The legislature acceded in 2023 and passed, as he put it, the “largest tax cut in West Virginia history.”2 Individual income tax rates were cut across the board, with the top rate cut from 6.5 percent to 4.9 percent. It is the largest tax cut relative to state tax revenues in this year’s report. Justice also approved school choice reforms allowing all students to opt for ESAs to cover private schooling costs.”

Cato Institute, "Fiscal Policy Report Card on America's Governors 2024"

• No. 4 — Arkansas Gov. Sarah Huckabee Sanders (69%)

“Sarah Huckabee Sanders of Arkansas has pursued major tax reforms since her election in 2022. In a series of bills, she cut the top individual income tax rate from 4.9 percent to 3.9 percent and the corporate rate from 5.3 percent to 4.3 percent. Sanders says she is “committed to responsibly phasing out our state income tax rate and letting everyone keep more of their hard-earned money.”3 She has kept the lid on spending increases and Arkansas has one of the largest rainy day funds in the nation. Sanders also approved major school choice reforms in 2023 based on ESAs and universal eligibility.”

Cato Institute, "Fiscal Policy Report Card on America's Governors 2024"

• No. 5 — South Dakota Gov. Kristi Noem (69%)

“Kristi Noem of South Dakota has defended her state’s low-tax policies since her election in 2018. As one of the freest states in the nation, South Dakota enjoys net domestic in-migration, while most of its neighbors suffer out-migration. Noem cut the general sales tax rate from 4.5 percent to 4.2 percent—a significant reduction, as the state has no income tax and relies heavily on sales taxes. Noem consistently proposes flat budgets.”

Cato Institute, "Fiscal Policy Report Card on America's Governors 2024"

• No. 6 — Montana Gov. Greg Gianforte (66%)

“Greg Gianforte was elected Montana governor in 2020. He was determined to cut income tax rates and succeeded in a series of bills. In 2021, he cut the top individual income tax rate from 6.9 percent to 6.5 percent and collapsed seven income tax brackets to two. He expanded the standard deduction and repealed tax credits. Further reforms in 2023 cut the top individual income tax rate to 5.9 percent. He has also cut the capital gains tax rate and increased the exemption level for taxing business equipment.”

Cato Institute, "Fiscal Policy Report Card on America's Governors 2024"

Meanwhile, Florida’s own Gov. Ron DeSantis ranked just above average, scoring 52% — a solid “C.”

While the study gives DeSantis props for his history of supporting tax breaks (including tax holidays and a gas tax suspension), the Cato Institute dinged the Florida governor for not going far enough.

“Using budget surpluses for temporary tax breaks has reduced funds available for spending, but it would have been better to enact permanent tax reforms,” the study reads.

In line with his grade, the study also states that DeSantis also scored “above average” when it came to state spending, thanks to his lean-budget proposals and willingness to veto spending, including nearly $1 billion from the current year’s budget.

In addition, the Cato Institute discusses DeSantis’ fiscal approach of keeping a low number of state employees, paying down debts, and bolstering the state’s reserve funds.

Meanwhile, the rest of the report card is as follows: