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Additionally, the group found out that a few local elected officials “have used portions of the money owed to pension and OPEB funds to keep taxes low and pay for politically popular programs. Instead of funding promised benefits now, politicians have charged them to future taxpayers” to hide debt while giving the impression that budgets are balanced, according to TIA.
Reduced pension market values were identified by TIA as one of the cities’ financial problems.
“In 2022, the cities continued to receive and spend federal COVID-19 relief funds, and as the U.S. economy reopened, they took in additional tax revenue. Such economic gains were offset by increases in their pension liabilities, which were caused in large part by decreases in the market value of pension investments,” said the analysis.
ALERT! Major Water Restrictions In Effect!
“Over the past few years, investment market values have swung dramatically. In 2022, this volatility negatively impacted most cities’ pension investments and their financial condition, which demonstrates the risk to taxpayers when cities offer defined pension benefits to their employees,” it added.
The Center Square made more observations: “Of the 75 cities evaluated, only 1% received an A grade for fiscal health. The majority received D grades, followed by C and B grades, according to the analysis.
“The five cities with the greatest surpluses were Washington, D.C. ($10,700), Irvine, California ($6,100), Plano, Texas ($5,100), Lincoln, Nebraska ($4,100), and Oklahoma City ($2,900). Rounding out the top ten with the greatest surpluses were Aurora, Colorado; Fresno, California; Raleigh, North Carolina; Virginia Beach; and Corpus Christi, Texas.”
Nine out of 10 of the cities with the highest tax burdens are led by Democrats.
With -$61,800, New York City has the largest taxpayer load, followed by Chicago at -$42,900. The current values for Honolulu, Philadelphia, Portland, New Orleans, Miami (R), Milwaukee, and Baltimore are -$14,100, -$20,400, -$18,200, and -$15,500, respectively.
