The five largest cities in the United States — which all coincidently are controlled by local, Democratic leaders — are on the verge of financial ruin according to shocking new data.
According Truth in Accounting’s (TIA) latest Financial State of the Cities 2026 report, Los Angeles, Houston, Philadelphia, Chicago and New York City did not have enough money to pay their bills in 2024.
The stunning long-term analysis is based on the most recent audited Annual Comprehensive Financial Reports from fiscal year 2024.
TIA uses projections and assesses the amount of money city governments need to pay their bills, dividing this number by the estimated number of city taxpayers. This difference is the taxpayer burden, or what every taxpayer owes in order to pay off the city’s debt.
The latest analysis discovered that New York City residents have the highest taxpayer burden of $61,700, followed by Chicagoans’ $42,600, Philadelphians’ $17,000, Houstonians’ $4,800 and Los Angeles residents’ $1,300.
TIA has historically issued reports evaluating the top 75 most populous cities every year.
The latest report focused on the top five largest U.S. cities because “prior analysis found that the five largest cities accounted for over 80 percent of total city debt,” TIA explained.
At the end of fiscal 2024, all five cities didn’t have enough money to pay their bills despite having balanced budget requirements.
Per the report, in order “to claim their budgets were balanced, as is required by law in the five cities, elected officials” didn’t include “the full cost of government in their budget calculations and shifted costs onto future taxpayers,” TIA said.
Combined, the five cities had $144 billion in assets; their combined debt, including unfunded pension and other post-employment benefits (OPEB), totaled $384 billion.
Their combined shortfall was $240 billion, according to the analysis — including $92 billion in pension debt and $112 billion in OPEB, mainly retiree health care, debt.
A “common and pressing challenge persists” in all five cities, the report notes: “long-term costs of pensions and retiree health care benefits continue to strain their financial health despite short-term improvements or varying circumstances.”
“While investment gains have temporarily eased pension liabilities in cities like New York City and Houston, these gains remain unrealized and uncertain,” it says.
Specific examples include New York City’s growing retiree health care obligations that “remain vastly underfunded,” as do the other cities.’
“Chicago exemplifies the consequences of chronic pension underfunding, with liabilities exceeding assets and recurring budget shortfalls,” the analysis added.
“Los Angeles and Philadelphia, which have made progress in funding, face limitations in financial flexibility due to increased capital investments and rising expenses,” it adds.
The report also grades each city based on its taxpayer burden. New York City and Chicago received F grades; Philadelphia received a D; Houston and Los Angeles received C grades for fiscal health.
The annual report also makes recommendations for local governments related to preparing financial reports and encourages citizens and the media to “hold leaders accountable.”