“To help leaders craft effective policies for their states’ rainy day funds, The Pew Charitable Trusts examined the statutory or constitutional language governing these funds and the trends in their balances. The research found that:

• Out of the 46 states with rainy day funds, more than half—27—do not clearly express in state law what they are seeking to achieve with them. Only one state—Minnesota—sets the level of budgetary risk it wishes to offset by having a fund.
• During the growth years of the mid-2000s, rainy day funds in 21 states were prevented from growing larger because balances quickly swelled to their maximum levels, which resulted in most of those states relying more heavily on spending cuts and tax increases to balance their budgets during and after the Great Recession.
• Only five states—Connecticut, Minnesota, Nebraska, Oregon, and Utah—currently require by law regular, periodic evaluations of revenue volatility patterns in order to determine a sufficient maximum or targeted balance for their funds. The remaining 41 states with rainy day funds do not have a process for re-examining the size of their funds in response to changing fiscal and economic conditions…”