‘We don’t have the money’: Economist weighs in on finances after mayor claims city is ‘broke’

Houston Mayor John Whitmire’s assertion that the city is financially strained sparked debate among council members, with some, like District J Councilman Edward Pollard and District F Councilwoman Tiffany D. Thomas, disagreeing with the characterization.

Pollard expressed skepticism about the city’s purported financial crisis, suggesting that the city has adequate funds to operate effectively. Similarly, Thomas challenged Whitmire’s assessment, emphasizing the city’s financial stability, particularly citing sales tax revenue projections.

However, despite differing opinions among officials, the City of Houston faces significant funding challenges, according to John Diamond, director of the Center for Public Finance at Rice’s Baker Institute. Diamond pointed out the pressing need for infrastructure projects and road repairs, which exceed the city’s current financial capacity. As a result, the city may resort to borrowing through bonds to finance essential projects.

At a recent city council meeting, approvals were sought for bond issuance, including one to secure funds for various projects and another specifically for airport system improvements. The latter includes funding for the redevelopment of Terminal B at Bush Airport, totaling $1.95 billion.

Diamond likened the use of bonds to a temporary solution, allowing the city to address immediate needs while deferring financial constraints to the future. Despite the availability of bond financing, the underlying financial challenges facing the city underscore the necessity for long-term fiscal planning and sustainable budget management.