I've alerted Development about your error, but it appears to be coming from Authorize.Net's end. I'm not sure we even pass a billing state/province to them, so you may need to look for a setting in your account there to require it and see if you can disable that.
From what I can tell, those settings may be in your Authorize.Net account at Settings and Profile > Payment Form > Form Fields, where you would uncheck the Required box for State/Province and any other fields you have checked there.
