Unlike the Federal Government, where the NSA characterizes the level of documents and how they should be destroyed, there are no specific guidelines for State Governments. All states comply with Federal privacy laws such as HIPPA; however, each state dictates how they want documents to be destroyed. This can even be different from state agency to state agency.
For the most part, state and local governments simply require a cross cut spec to satisfy requirements. This is a DIN Level 3. Security Level 3 requires a narrow strip cut or a fairly large crosscut particle. The strip cut should be 2 mm (3/32”) or less. The allowed crosscut particle would measure 3/16” X 3” or less. Level 3 is adequate to meet most unclassified government applications. Unfortunately, like most things, there are a few exceptions. For example, if any Federal Law enforcement agencies are working with local authorities and sharing sensitive information, they may require the state to destroy that material to federal standards. In that case, if the information was classified or top secret it would be level 6.
We have found that in some cases, especially with larger state universities, people may want to set their own policy to destroy all documents to a classified spec in order to protect themselves.
When it comes down to it, there is not much individual state legislation for document destruction security. Each State and Local government agency set their own requirements based on their individual needs.