For state governments, credit ratings reflect the ability to pay debts and the strength of the state's economy. A lower rating typically forces a state to pay higher interest costs on the debt securities known as general obligation bonds.

Thirteen states currently earn Standard & Poor's 500 index's highest possible credit rating, and another 31 are in the middle of the pack. Now, see the sagging six at the lower end of the scale.

California: A-

In 2009, California's credit rating fell to the lowest in the nation on the S&P 500 scale, from A+ to A, as a result of a budget deficit reaching into the billions. In January 2010, California's credit rating was cut even further, this time from A to A-. S&P 500 apparently saw signs of improvement in February 2012, when it upgraded California's financial outlook from stable to positive.

Illinois: A+

In December 2009, S&P 500 downgraded Illinois to A+ from AA- as a result of stubborn budget problems. In March 2012, the credit ratings agency announced that Illinois' rating could fall by another several notches as a result of budget imbalances and unfunded pension liabilities. S&P 500 followed up with another threat in June.

Arizona: AA-

Arizona's credit rating was downgraded in 2009 to AA- from AA as a result of the housing crisis and constitutional limits on the state's ability to raise revenue. But things are looking up: In December 2011, S&P 500 raised Arizona's outlook from negative to stable as the state ended the year in the black with tax collections exceeding estimates.

Kentucky: AA-

In October 2002, S&P 500 downgraded Kentucky's credit rating to AA- from AA due to financial difficulties and the lack of a budget in the General Assembly. The loss of manufacturing jobs in the state has taken a toll on the economy.

Michigan: AA-

In December 2003, Michigan lost its stellar AAA rating as a result of the fallout from the failing auto industry, and it was downgraded to AA+. The state has continued to struggle and in April 2007 saw its credit rating fall to the current AA- because S&P 500 said Michigan had failed to take real action to balance the budget for the long term.

New Jersey: AA-

In February 2011, New Jersey was downgraded to AA- from AA. S&P 500 said the state's finances were being strained by huge pension obligations, high debt levels and generous unemployment benefits.