I have set up a new state but still can't process order, why?

There are two places in the admin panel that need to be looked at when these issues come up. Those are Shipping and Operating Countries in settings. Eg :

"We are unable to ring up an order to California even though I have a shipping strategy setup for it"

In this example California has been set up in Shipping but within the Operating Countries California was not selected.

"I have enabled California in my Operating Countries but cannot ship to it"

In this example California has been set up in Operating Countries but not within the Shipping.