Houston Receives 'C' Grade for Fiscal Health

According to Truth in Accounting’s Financial State of the Cities 2026 report, Houston did not have enough money at the end of fiscal year 2024 to pay all its bills. The report shows a shortfall that equals a Taxpayer Burden™ of about $4,800 per taxpayer.

The analysis notes that Houston’s pension systems are funded close to actuarially determined levels, but that retiree health benefits remain largely unfunded and paid on a pay-as-you-go basis. This contributes significantly to the city’s long-term obligations exceeding available assets. Houston earned a grade of “C,” indicating the city is closer to meeting its balanced budget requirements but is still in debt.

This report delivers a straightforward review of the five largest U.S. cities’ assets and debts, including often-overlooked retirement liabilities, to give taxpayers a clearer view of fiscal realities. To promote accountability, budgets must incorporate contributions to retirement systems, ensuring officials fully recognize and fund these commitments.