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The Statehouse dome is shown in this file photo.

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TRENTON — New Jersey is in the worst fiscal shape of all 50 states, according to a think tank.

An analysis released Thursday by the fiscally conservative Mercatus Center at George Mason University ranked every state by four measures based on 2012 data. New Jersey ranked last in two of them, and near the bottom in the other two.

"Although the ranking represents a snapshot in time, the states at the bottom are there due to years of poor financial management decisions, bad economic conditions, or a combination of both," study author Sarah Arnett wrote.

Bill Quinn, a spokesman for the state Department of Treasury, said Gov. Chris Christie's administration has "dealt constructively and decisively with the legacy of past spending excesses."

"New Jersey’s public debt built up over many years as a series of governors and legislatures borrowed heavily to maintain spending levels that could not be supported even in the best of economic times," Quinn said. "The impact of the most recent recession on state revenues put New Jersey into a severe budget crisis by the time Governor Christie took office in 2010."

New Jersey ranked 36th in cash solvency, which measures how easily the state can pay its short-term debts, and 39th in service-level solvency, which reflects access to resources to provide services to residents.

But New Jersey ranked last for long-term solvency, which measures how the state will be able to meet its long-term obligations like pensions and infrastructure maintenance, and budget solvency, which tracks the ability to raise revenue to cover its fiscal year expenses.

New Jersey came in 50th in the overall ranking of states’ fiscal conditions. Rounding out the bottom five are Connecticut, Illinois, Massachusetts and California. The study found that Alaska, South Dakota, North Dakota, Nebraska and Wyoming are on the best fiscal footing.

The state’s dire fiscal straits are due in part to more than $25 billion in unfunded pension liabilities and $59 billion for health benefits.

"New Jersey faces long-run solvency problems due in part to nearly 15 years of underfunding its state and local pensions," Arnett wrote.

Arnett also faulted New Jersey for engaging in "practices that only appeared to balance their annual budgets."

Veronique de Rugy, a senior research fellow at the center, said "there’s no way to ignore the fact that New Jersey is on a very unsustainable path.

"If there’s a moment you can’t pay your bills, something’s got to give," she said. "If you reach the point you can’t raise taxes, you’re going to have to cut something."

Rugy credited Christie with taking some steps in the right direction, but said "he’s only scratched the surface."

"I think taxes are way too high in New Jersey," she said. "You have pensions, but the health care for public employees is a major problem. And as far as I knew he hasn’t done very much on this either."

Correction: This story initially incorrectly referred to the university that hosts the Mercatus Center. It's George Mason University, not George Washington University.

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