Houston Republic

A Truth in Accounting report ranked Houston 58th out of 75 cities nationally in its financial health based on the 2019 fiscal year (FY).

The organization's fifth annual Financial State of the Cities 2021 is a comprehensive analysis of 75 of the most populated cities in the U.S. and each city's financial health, as was calculated before the pandemic. Truth in Accounting, a nonprofit conservative think-tank that provides an analysis of governmental fiscal data, ranks cities based on whether taxpayers would see a surplus of money after the city’s bills are paid, or how much taxpayers would each have to contribute for a city to pay all of its bills.

The top five cities are considered in the report as “sunshine cities,” and the bottom are referred to as “sinkhole cities.”

At 58th in the nation, Houston is in neither of those categories but received a grade of "D." 

The Truth in Accounting report revealed that Houston was in poor fiscal health before the pandemic began. In fact, Truth in Accounting noted that the city’s debt burden is $7.5 billion, or $11,600 for every taxpayer in the city based on the audited financial report for FY 2019. 

There are several reasons for that debt burden, including unfunded retirement mandates of $19.4 billion in promised retirement benefits, a shortfall of $4.1 billion for the pension and $2.3 billion in retiree health care benefits.

At the time of analysis, the city had $5.65 billion in funds available with $13.16 billion in bills needing to be paid. In addition, the city will most like lose revenue for 2020, based on the COVID-19 pandemic and its effects.

The grading scale classified as D-grade runs from $5,000 to $20,000 in individual taxpayer burden.

In total for all 75 cities ranked, the debt came to $333.5 billion at the end of the 2019 fiscal year.

The full report can be viewed on the Truth in Accounting website.