Why do US flagship state universities vary so much in quality?
Different states have very different political attitudes towards their flagship schools as well. This makes a difference with funding levels of course. It also makes a difference in terms of how money is to be used. A governor/executive, combined with a university president, that wants to grow a flagship institution can help earmark funds to attract top-notch researchers, link business activity and academic areas to grow in, and so on. It takes planning and vision as well as money, and that varies a lot from state to state.