For the past five years, most states have been making steady progress stabilizing budgets hit hard by the Great Recession, rising pension and health-care costs, and tax-weary voters.
Then there's Puerto Rico.
Swamped by a debt load accumulated by years of borrowing to pay its day-to-day expenses, the island commonwealth has recently seen its credit rating slashed to junk status. Credit analysts say that—while some states still face major budget challenges—not one of them is up against anything even close to the fiscal bind facing Puerto Rico.
"Puerto Rico is really in a class by itself," said Laura Porter, head of state credit ratings at Fitch Ratings. "Their challenges are pretty unique to them."
The problem starts with a pile of debt that's roughly 10 times the average level, per capita, for the rest of the states.
"They have over a decade of consecutive operating deficits, and they financed those operating deficits with debt," said David Hitchcock, a credit analyst at Standard & Poor's. "That alone separates Puerto Rico from almost all the states. No states have come close to that."
Puerto Rico's budget pressures have been amplified by a local economy that's been contracting since 2006—a recession that began before the rest of the states and is hanging on far longer. Though it's Caribbean location remains a tourist draw, roughly half the island's economy is based on manufacturing, which has been hit hard by a change in federal tax law that removed some incentives for mainland manufacturers operating there.
Puerto Rican manufacturers are also competing against NAFTA member Mexico for low-cost production but face higher labor costs because they are required to pay U.S. minimum wage, said Hitchcock.
(Read more: Puerto Rico approves measures to manage debt load)
With the unemployment rate well north of 15 percent, the population has been shrinking, further eroding tax receipts. All of which makes comparisons with other sates difficult to make.
To be sure, some mainland states are facing budget pressures of their own. The four states with a "negative" outlook from Fitch—a warning that their ratings could drop a notch in the next year or two—include Connecticut, Illinois, Minnesota and Pennsylvania.
Among the factors that earned states a red flag, all face rising pension and health-care costs. While still manageable, those rising costs are crowding out spending on other programs and services, said Porter.
Higher infrastructure costs—at a time when federal funding for such projects is shrinking—is crimping spending among many mainland states. The imminent depletion of the federal Highway Trust Fund this summer will only increase that pressure.
Health-care spending is rising for more than just state workers and retirees. As health reform increases enrollments in Medicaid—which is partially state-funded—the longer-term impact is still unclear.
In states under fiscal pressure, budget reform has often been hampered by the same kind of political gridlock that has gripped budget makers in Washington.
"One of the challenges in Illinois has been just an unwillingness to do anything about anything really," said Porter. "It's been just purely political."
Illinois has enacted temporary income tax increases to offset rising costs, but it's unclear whether those hikes will survive past this fall's gubernatorial election. Some 35 other states will elect governors, which could impact tax and spending policies.