The Pew Charitable Trusts devotes significant resources to assessing the fiscal health of the states. They do (mostly) great work, and the information they provide is a great comparison of how different states approach managing their finances. It’s something we look at regularly.
As you can see Washington was slightly above the national median at the beginning of the century, then dropped below due to Initiative 728, the tech boom crash, and one of the Eyman measures that lowered taxes since we had such a “large reserve.”
We used the reserves during the great recession, and have been building them up since I became Appropriations chair. (This may be a big of hubris – we also passed a constitutional amendment protecting the fund at the beginning of this period.) The article on the Pew Website talks about how different situations in different states may affect appropriate reserve levels, which is very true. Many other states look like us, but some look like a crime scene. Illinois, for example, seems to moving asymptotically towards zero. Oregon was more than a month below zero for a while early in the aughts.
Current planning numbers have the reserve doubling over the next biennium to just under a billion. There are reasonable limits to how much you should save, but having a substantial reserve allows us to deal with normal volatility in the revenue system without making random cuts in programs or tax increases to deal with blips in revenue.
Other measures have to be considered when you are trying to assess the fiscal health of a state – Washington is in the top 5 for responsible funding levels for its pension system, a key indicator.