I needed to use the "Investment Adjustment" for U.S. obligations (which is not technically correct) on my state return to get the correct result.
The screen shots at this post might help with making the correct entries.
https://ttlc.intuit.com/community/state-taxes/discussion/do-i-enter-the-state-in-which-i-live-in-regarding-the-earned-exempt-interest-dividends-in-for-the/00/2074410