By Adam Andrzejewski for RealClearPolicy
New York City is in trouble. A new report by Truth In Accounting, a nonpartisan nonprofit that specializes in government transparency, shows that New York City has $204.4 billion in debt—$71,400 per taxpayer.
This means that each taxpayer would have to pay $71,400 in future taxes without receiving any related services or benefits.
According to the report, New York City ranks dead last in an analysis of the financial health of 75 major U.S. cities, earning it the label of “sinkhole city” based on its abysmal financial state. Their per resident debt is about $30,000 more than the next worst city, Chicago.
Of course, this is after the state of New York received $112 billion in federal relief funds, most of which went to New York City.
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What went so wrong? Truth In Accounting blames bloated retiree healthcare benefits and pension obligations. The report states, “The city’s pension plans are 78 percent funded, but the city has funded only three percent of the $117.4 billion in other post-employment benefits that employees have earned and been promised.”
Promising extravagant benefits without having a way to pay for them rarely ends well.
Sadly, it doesn’t seem like this debt is going anywhere. Rather than doing the tough work to actually balance the budget, New York City Mayor Eric Adams is seeking legislation to increase the amount of money New York City can borrow by $19 billion, a move his own comptroller calls “fiscally imprudent.”
Extravagant spending isn’t only a federal problem. Your local towns, cities, and states all have an obligation to spend responsibly.
You can use Truth In Accounting’s tool here to see the amount your city is in debt.
Syndicated with permission from Real Clear Wire.
The #WasteOfTheDay is presented by the forensic auditors at OpenTheBooks.com.