Yes this is possible with Rules, if combined with Views Bulk Operations, as further detailed below ...
What you actually need to do is similar to what is shown in the video about Using VBO to load list of objects into Rules, starting from about 5:30, up to 11:30. Here is a summary of what is shown in this video (quote from the linked page):
- You need a view that lists the entities you want to work on in Rules. Note that you don't need a display of the view – and it might even be better not to have one if you don't want the view to be displayed somewhere.
- However, you need one bulk operations field. The type of bulk operations field determines what entity type will be sent to Rules. Note that you don't need any actions enabled for the field – it is enough that it is present.
- You need a rule that, as an action, loads entities from a VBO. (This is available under the "Views bulk operations" group.) All view displays with at least one VBO field will be selectable.
- The action provides a list of entities, that can be used just like other lists in Rules. Combine with loops, actions and Rules Scheduler to make awesomeness happen.
In your case you want to start from a VBO list of all the users you want to get processed (= "all users from the same state", as in your question). And for each user in the list you want the Rules Action to be "send an eMail" (instead of "remove sticky").
Easy, no? Happy VBO-ing with Rules ... ( or Rules-ing with VBO if you prefer)!