Magento 2.1 – Free Shipping and Flat Rate for Specified States

There is the same bug on Magento 1.6. This fix is working and I hope to work on Magento 1.7 too.

Open app/code/core/Mage/SalesRule/Model/Validator.php and add below this:

protected $_baseRoundingDeltas = array();

this code:

protected $_address = null;

also in protected function _getAddress below this:

if ($item instanceof Mage_Sales_Model_Quote_Address_Item) {
    $address = $item->getAddress();

add this:

} elseif ($this->_address) {
    $address = $this->_address;

and finally in public function reset above this:

return $this;

add this:

$this->_address = $address;

Rather than using the Flat Rate shipping method you should use the Table Rate shipping method which will allow you to set the shipping rate by price vs destination among others.

With this method you need to create a CSV file with your table rate shipping pricing and upload it to the Magento admin panel.

The Magento User guide gives a pretty good set of instructions on it here.

It can be tedious creating a CSV file with all your destination countries, I've used this web based tool to generate one for me in the past.