The cities of New York, Chicago, Los Angeles, the city and county of San Francisco*, and Houston report the most total liabilities.

The $1.4 trillion in debt carried by cities, towns, and other incorporated municipalities represents 23% of total state and local government debt found in the State and Local Government Finance Report, which can be explored interactively in Reason Foundation’s GovFinance Dashboard.

In per capita terms for cities with 10,000 residents or more, the city and county of San Francisco* ranks first, with total liabilities representing about $43,000 per resident. The rest of the top five cities in per capita debt are Nantucket (MA), New York, Ocean City (NJ), and Miami Beach.

Total debt, reported as “total liabilities,” includes money a city owes in the near term, such as unpaid bills and accrued payroll, as well as long-term obligations, including bonds, pensions, and retiree healthcare.

Reason Foundation extracted this data from publicly available, audited financial reports filed by each county for their fiscal year 2023. While the dashboard covers 90% of the U.S. population living in an incorporated city, this analysis displays the top 50 cities in each category, among cities with 10,000 residents or more.

* Several jurisdictions in the United States operate under consolidated city–county governments, meaning their financial data reflect both city and county functions. Due to their structure and financial reporting practices, these entities could be considered either a city or a county, and therefore, are listed in both the city and county rankings of this report, which can make some comparisons to other cities or counties difficult. Some of the entities most impacted in the rankings and figures are San Francisco, Denver, Honolulu, Nashville, New Orleans, New York and Philadelphia.

The combined entities in the report include the city and borough of Juneau (AK), city and borough of Sitka (AK), city and borough of Wrangell (AK), city and county of San Francisco (CA), city and county of Broomfield (CO), city and county of Denver (CO), Jacksonville (FL), Athens–Clarke County (GA), Columbus–Muscogee County (GA), Georgetown–Quitman County (GA), Macon–Bibb County (GA), city and county of Honolulu (HI), Greeley County (KS), Wyandotte County (KS), Lexington–Fayette Urban County (KY), Louisville/Jefferson County Metro Government (KY), New Orleans (LA), Anaconda–Deer Lodge County (MT), Butte–Silver Bow County (MT), Philadelphia (PA), Lynchburg–Moore County Metropolitan Government (TN), and Nashville–Davidson County (TN). In our aggregate figures, these entities are added to the “county total.”

The five New York City counties—Bronx, Kings, New York, Queens, and Richmond—are consolidated in a single city government and financial report and are listed collectively as New York City in this report.

Baltimore (MD), St. Louis (MO), Chesapeake (VA), Norfolk (VA), Virginia Beach (VA), Baton Rouge (LA), and the District of Columbia (DC) are independent city governments. They have no overlapping county, and perform both municipal and county functions—or in the case of Baton Rouge, the county government falls under the umbrella of the city. In our aggregate figures, these entities are added to the “municipal total.” For more details, please see the report’s about page.

City governments’ long-term debt

About 85% of city debt is long-term—that is, due in more than one year. This category consists of bonds, loans, and notes (50%), unfunded pension liabilities (25%), unfunded retiree health care (18%), and accrued leave payouts (2%).

Cities collectively report $1.2 trillion in long-term debt, or about $6,000 per capita nationally.

New York, Chicago, Los Angeles, the city and county of San Francisco, and Houston declared the most total long-term debt.

For cities with 10,000 residents or more, the city and county of San Francisco ranks first in per capita long-term debt, at $36,602 per resident, followed by Ocean City (NJ), Nantucket (MA), New York City, and Miami Beach.

City government pension debt

Unfunded pension liabilities arise when governments set aside fewer assets than required to fulfill the retirement benefits promised to its public employees–declared as net pension liability.

Cities collectively report nearly $300 billion in unfunded pension obligations, equal to 25% of their long-term debt and equivalent to about $1,500 per capita nationally.

For cities with 10,000 residents or more, New York City has the most total public pension debt at $40 billion, followed by Chicago, Los Angeles, Phoenix, and Philadelphia.

In per capita terms, the city of Chicago ranks first, with its pension debt representing about $13,500 per resident. Beverly Hills, Miami Beach, Riverdale (IL), and Forest Park (IL) follow.

City government OPEB debt

Other post-employment benefits (OPEB) are mostly retiree health care for public employees. OPEB debt arises when governments promise these benefits but do not set aside enough money in advance to cover the future costs, which are declared as net OPEB liability.

Cities collectively report $215 billion in OPEB debt, equal to 18% of their long-term debt, equivalent to roughly $1,100 per capita nationally.

The city New York has the most total pension debt at $95 billion, followed by city and county of San Francisco, Austin, Yonkers (NY), and Boston.

In per capita terms, among cities with 10,000 residents or more, the city of Yonkers (NY) ranks first, with its OPEB debt representing about $12,100 per resident. Waltham (MA), New York, Hoboken (NJ), and Plattsburgh (NY) follow.

City governments’ outstanding bonded debt

Bonds, loans, and notes represent the portion of a city’s long-term liabilities explicitly borrowed in credit markets. Unlike pensions or OPEB, which accumulate as estimated unfunded promises, these instruments are contractual debt obligations with fixed repayment schedules.

Nationally, cities report $608 billion in outstanding bonds, loans, and notes—50% of all long-term liabilities. This equals about $3,000 per capita.

New York City has the most total bonded debt at $105 billion, followed by Los Angeles, Chicago, the city and county of San Francisco, and Houston.

In per capita terms, the city and county of San Francisco (CA) ranks first, with its bonded debt representing about $27,900 per resident. Celina (TX), Salt Lake City (UT), Nantucket (MA), and Washington (DC) follow.

Reason Foundation’s State and Local Government Finance Report totals the liabilities of each state government, as well as the cities, towns, counties, and school districts within each state. This report covers all 50 state governments, over 2,000 county governments, 8,000 municipal governments, and 10,000 school districts, which serve 331 million Americans nationwide.

All figures in the State and Local Government Finance Report are sourced from the financial reports of state and local governments, most often their annual comprehensive financial reports. The data is from the 2023 fiscal year, the most recent year for which complete data are available. Nevada and a handful of cities and counties across the country have not reported 2023 data. Our database lists the available 2023 fiscal year data for each city.

Despite a thorough review, data collection at this scale can result in discrepancies. Please alert us if you identify any errors.

For personalized reports on municipal entities or more detailed information on assets, liquidity, and solvency, please visit the GovFinance Dashboard.

If you have any questions or would like to discuss this data more, please email Mariana Trujillo at mariana.trujillo@reason.org or Jordan Campbell at jordan.campbell@reason.org.

Related:

Report: State and local governments have $6.1 trillion in debt

Report ranks every state’s total debt, from California’s $497 billion to South Dakota’s $2 billion

The post Report: Cities have $1.4 trillion in debt appeared first on Reason Foundation.

Los Angeles County has the most debt of any county government: $62.36 billion.

The combined city and county of San Francisco and Miami-Dade County each had more than $30 billion in debt at the end of 2023. Cook County and the combined city and county of Philadelphia were next, with over $20 billion in debt.

The rest of the 10 most-indebted counties at the end of 2023 were Washington, D.C. ($19.83 billion), the combined city and county of Denver* ($14.3 billion), Nassau County ($14.2 billion), Santa Clara County ($13.4 billion), and the combined city and county of Honolulu* ($12 billion).

This analysis is part of Reason Foundation’s State and Local Government Finance Report, which can be explored interactively in the GovFinance Dashboard. Reason Foundation extracted this data from publicly available, audited financial reports filed by each county for their fiscal year 2023.

Total debt, reported as total liabilities, includes money a county government owes in the near term, such as unpaid bills and accrued payroll, as well as long-term obligations, including bonds, public pension benefits, and retiree health care benefits.

In per capita terms, North Slope Borough, Alaska, ranks first, with its total debt representing $46,883 per county resident.

For counties with 10,000 residents or more, the combined city and county of San Francisco, Washington, DC, the combined city and county of Denver, and Baltimore have the next highest per capita debt levels.

At $12,880 per person, Los Alamos County, New Mexico, has the sixth most per capita county debt.

For counties with 10,000 residents or more, a total of 43 counties reported at least $7,000 in per capita debt, including 21 counties with more than $10,000 in per capita debt.

* Several jurisdictions in the United States operate under consolidated city–county governments, meaning their financial data reflect both city and county functions. Due to their structure and financial reporting practices, these entities could be considered either a city or a county, and therefore, are listed in both the city and county rankings of this report, which can make some comparisons to other cities or counties difficult. Some of the entities most impacted in the rankings and figures are San Francisco, Denver, Honolulu, Nashville, New Orleans, New York and Philadelphia.

The combined entities in the report include the city and borough of Juneau (AK), city and borough of Sitka (AK), city and borough of Wrangell (AK), city and county of San Francisco (CA), city and county of Broomfield (CO), city and county of Denver (CO), Jacksonville (FL), Athens–Clarke County (GA), Columbus–Muscogee County (GA), Georgetown–Quitman County (GA), Macon–Bibb County (GA), city and county of Honolulu (HI), Greeley County (KS), Wyandotte County (KS), Lexington–Fayette Urban County (KY), Louisville/Jefferson County Metro Government (KY), New Orleans (LA), Anaconda–Deer Lodge County (MT), Butte–Silver Bow County (MT), Philadelphia (PA), Lynchburg–Moore County Metropolitan Government (TN), and Nashville–Davidson County (TN). In our aggregate figures, these entities are added to the “county total.”

The five New York City counties—Bronx, Kings, New York, Queens, and Richmond—are consolidated in a single city government and financial report and are listed collectively as the city of New York (NY) in this report.

Baltimore (MD), St. Louis (MO), Chesapeake (VA), Norfolk (VA), Virginia Beach (VA), Baton Rouge (LA), and the District of Columbia (DC) are independent city governments. They have no overlapping county, and perform both municipal and county functions—or in the case of Baton Rouge the county government falls under the umbrella of the city. In our aggregate figures, these entities are added to the “municipal total.” For more details, please see the report’s about page.

Long-term debt

About 80% of county debt is long-term debt, which is due in more than one year. Long-term debt consists of bonds, loans, and notes (44%), unfunded pension liabilities (29%), unfunded retiree health care (17%), and accrued leave payouts (3%).

Counties collectively report $624 billion in long-term debt, or $2,200 per capita nationally.

Los Angeles County has the most long-term liabilities at $52 billion, followed by the combined city and county of San Francisco, Miami-Dade County, Cook County, and the combined city and county of Philadelphia.

In per capita terms, for counties with 10,000 residents or more, the city and county of San Francisco has the most long-term liabilities, representing $46,883 per resident. North Slope Borough, Alaska, was second, with more than $35,000 in long-term debt per resident, followed by Washington, D.C., with over $23,000 per capita.

The combined city and county of Denver, Baltimore, Los Alamos County (NM), the combined city and county of Honolulu, Cape May County (NJ), Inyo County (CA), the combined city of Nashville-Davidson County (TN), and Miami-Dade County also had long-term liabilities exceeding $10,000 per capita.

County pension debt

Unfunded pension liabilities arise when governments set aside fewer assets than required to fulfill the retirement benefits promised to their public employees, which are declared as net pension liabilities.

At the end of 2023, counties collectively reported $181 billion in unfunded pension obligations, which represent 30% of their long-term debt. On a per capita basis, this county pension debt amounts to about $600 per person nationally.

Los Angeles County has the most public pension debt at $13.2 billion, followed by Cook County, Santa Clara County, San Diego County, and the combined city and county of Philadelphia.

In per capita terms, for counties with 10,000 residents or more, North Slope Borough, Alaska, ranks highest in the nation, with its public pension debt representing $12,318 per county resident, followed by Los Alamos County ($6,057 per capita), Mono County ($5,111), Juneau City and Borough ($4,386), Inyo County ($4,363) and Colusa County ($4,220).

Other post-employment benefits debt

Other post-employment benefits debt (OPEB), which are primarily public employee retiree health care benefits, are rarely pre-funded, making them a significant source of unfunded liabilities for governments. OPEB debt arises when governments promise health care or other post-employment benefits to workers but fail to set aside enough money in advance to cover the future costs.

At the end of 2023, counties collectively reported $107 billion in OPEB debt, which represents 17% of their long-term debt. On a per capita basis, this OPEB debt is equivalent to about $400 per capita nationally.

Los Angeles County had the largest total other post-employment benefits debt at $25 billion, more than four times that of the next highest county.

Nassau County, Suffolk County, the combined city and county of San Francisco, and Harris County have the next highest OPEB debt.

In per capita terms, for counties with 10,000 residents or more, Essex County (NY) ranks first, with its OPEB debt representing $4,885 per resident.

The combined city and county of San Francisco, Nassau County, and Schoharie County also had OPEB debt of more than $4,000 per capita at the end of 2023

Outstanding bonded debt

Bonds, loans, and notes represent the portion of a state government’s long-term liabilities that are explicitly borrowed in credit markets. Unlike public pension benefits or OPEB, which accumulate as estimated unfunded promises, these instruments are contractual debt obligations with fixed repayment schedules.

Nationally, counties report $275 billion in outstanding bonds, loans, and notes, which represent 44% of their long-term debt. On a per capita basis, this equals $956 per capita nationally.

The city and county of San Francisco has the most total bonded debt at $23.5 billion, followed by Miami-Dade County ($19.5 billion), Washington, DC ($12.6 billion), city and county of Denver ($9.9 billion, and city and county Honolulu ($7.1 billion).

In per capita terms, San Francisco ranks first, with its bonded debt representing $26,892 per resident. North Slope Borough, Washington, DC, Denver, and Arlington County (VA) were the next highest.

Reason Foundation’s State and Local Government Finance Report totals the liabilities of each state government, as well as the cities, towns, counties, and school districts within each state. This report covers all 50 state governments, over 2,000 county governments, 8,000 municipal governments, and 10,000 school districts, which serve 331 million Americans nationwide.

All figures in the State and Local Government Finance Report are sourced from the financial reports of state and local governments, most often their annual comprehensive financial reports. The data is from the 2023 fiscal year, the most recent year for which complete data are available. Nevada and a handful of cities and counties across the country have not reported 2023 data. Our database lists the available 2023 fiscal year data for each city.

Despite a thorough review, data collection at this scale can result in discrepancies. Please alert us if you identify any errors.

For personalized reports on municipal entities or more detailed information on assets, liquidity, and solvency, please visit the GovFinance Dashboard.

If you have any questions or would like to discuss this data more, please email Mariana Trujillo at mariana.trujillo@reason.org or Jordan Campbell at jordan.campbell@reason.org.

Related:

Report: State and local governments have $6.1 trillion in debt

Report ranks every state’s total debt, from California’s $497 billion to South Dakota’s $2 billion

The post Report: County governments have $757 billion in debt appeared first on Reason Foundation.

With $497 billion in liabilities, California had the largest state government debt as of the end of the 2023 fiscal year, the most recent year for which complete data are available.

Four other state governments had more than $200 billion in state debt: New York ($233 billion), Illinois ($223 billion), Texas ($217 billion), and New Jersey ($213 billion). Massachusetts had $120 billion in state liabilities, followed by Connecticut, Washington, Pennsylvania and Florida.

Meanwhile, 10 states—South Dakota, Idaho, Nebraska, Montana, New Hampshire, Utah, Vermont, Rhode Island, Wyoming, and Maine—each had less than $10 billion in debt at the end of 2023, according to Reason Foundation’s State and Local Government Finance Report.

On a per capita basis, Connecticut had the highest state debt, with $26,187 of debt per state resident at the end of 2023. With $22,968 in debt per resident, New Jersey was the only other state with more than $20,000 in liabilities per capita.

Reason Foundation finds 13 states—Connecticut, New Jersey, Hawaii, Delaware, Illinois, Massachusetts, Wyoming, Alaska, North Dakota, California, Washington, New York, and Vermont—had more than $10,000 in debt per resident.

Of other more populous states, Texas had $7,443 in per capita debt, Pennsylvania reported $5,872 per capita, and Florida had $3,334 in debt per capita.

The state governments with the lowest per capita debt at the end of 2023 were Tennessee, Utah, Nebraska, Idaho, South Dakota, Oklahoma, and Indiana, each with less than $3,000 in debt per resident.

Total state debt, reported as total liabilities, includes money state governments owe in the near term, such as unpaid bills and accrued payroll, as well as long-term obligations, including bonds, public pension benefits, and retiree health care benefits.

State governments’ long-term debt

Approximately 72% of state government debt is long-term, meaning it is due in more than one year. This long-term debt consists of bonds, loans, and notes (33%), unfunded public employee pension benefits (35%), unfunded public employee retiree health care benefits (22%), and accrued public employee leave payouts (2%).

State governments collectively reported $1.9 trillion in long-term debt, or approximately $5,800 per capita nationally, as of the end of 2023.

Reason Foundation found 29 states held at least $10 billion in long-term liabilities at the end of 2023.

Six of those states had more than $100 billion in long-term liabilities each: California ($299 billion in long-term debt), Illinois ($199 billion), New Jersey ($197 billion), Texas ($171 billion), New York ($154 billion), and Massachusetts ($104 billion).

Connecticut had the highest per capita long-term debt in the nation, at $23,934 per resident. New Jersey was just behind, with $21,197 in long-term debt per capita.

Hawaii, Illinois, Delaware, and Massachusetts were the other states with long-term debt exceeding $10,000 per capita at the end of 2023.

Of the larger states, New York ranked 12th in per capita long-term debt, with $7,615 per resident. California ranked 13th, with $7,552 per capita long-term debt. Texas was 16th, with $5,870 per capita. Florida ranked 37th in the nation in long-term liabilities, with $2,129 per capita.

Nebraska, Tennessee, Utah, and South Dakota were the only states reporting less than $1,000 per capita long-term debt at the end of 2023.

State public pension debt

Unfunded public employee pension liabilities occur when governments allocate fewer assets than necessary to fulfill the retirement benefits promised to public workers and retirees.

State governments collectively reported $664 billion in unfunded public pension obligations, equivalent to 35% of their long-term debt, or approximately $2,000 per capita nationally, as of the end of 2023.

As of the end of 2023, Illinois had the largest state pension debt, at $145 billion. It was the only state with more than $100 billion in state public pension debt.

California had the second-most state pension debt, $90 billion, which is primarily the state government’s portion of the larger unfunded liabilities held by the California Public Employees’ Retirement System and the California State Teachers’ Retirement System.

Five other state governments reported over $20 billion in pension debt: New Jersey ($80 billion), Texas ($55 billion), Massachusetts ($42 billion), Connecticut ($40 billion), and Kentucky ($29 billion)

On a per capita basis, Illinois again had the most pension debt, with $11,355 per resident. Connecticut was close behind with $11,192 per capita pension debt.

The remaining top 10 states with the highest per capita pension debt were New Jersey, Kentucky, Massachusetts, Alaska, Vermont, Hawaii, New Mexico, and Maryland.

In per capita pension debt, California ranks 14th, at $2,272 per resident; Texas ranks 16th, at $1,870; Florida ranks 41st, at $362; and New York ranks 49th, at $-157.

Three states did not have state pension debt at the end of 2023. Washington, New York, and South Dakota each reported more assets than projected liabilities across public pension systems.

Other post-employment benefits debt

Other post-employment benefits debt (OPEB), which are primarily public employee retiree health care benefits, are rarely pre-funded, making them a significant source of unfunded liabilities for governments. OPEB debt arises when governments promise health care or other post-employment benefits to workers but fail to set aside enough money in advance to cover the future costs.

State governments reported $421 billion in OPEB debt (22% of long-term liabilities), or about $1,300 per capita nationally, at the end of 2023.

Four states stand out with the most OPEB debt. California ($82 billion in OPEB debt), New Jersey ($75 billion), New York ($66 billion), and Texas ($53 billion).

Five other states had more than $10 billion in OPEB debt: Illinois ($20 billion), Pennsylvania ($17 billion), Connecticut ($17 billion), Massachusetts ($13 billion), and Maryland ($12 billion).

In per capita terms, New Jersey’s $8,067 of OPEB debt per resident was the highest. Delaware was close behind with $7,888 of OPED debt per capita.
The rest of the states with the most OPEB debt per capita at the end of 2023 were Connecticut ($4,687), New York ($3,289), Hawaii ($3,275), Vermont ($2,346), California ($2,069), Maryland ($1,921), Texas ($1,816), and Massachusetts ($1,805).

Alaska, Oregon, Utah, and South Dakota did not report any OPEB debt according to their 2023 financial reports.

State governments’ outstanding bonded debt

Bonds, loans, and notes represent the portion of a state government’s long-term liabilities that are explicitly borrowed in credit markets. Unlike public pension benefits or OPEB, which accumulate as estimated unfunded promises, these instruments are contractual debt obligations with fixed repayment schedules.

Nationally, state governments reported $630 billion in outstanding bonds, loans, and notes—33% of all state long-term liabilities, Reason Foundation finds. On a per capita basis, the state’s debt from bonds, loans, and notes equals about $1,900 per American.

California has the most outstanding bond debt, with $111.8 billion.

Texas has the second most bond debt, with $67 billion, followed by New York ($50 billion), Massachusetts ($46 billion), Illinois ($30 billion), Connecticut ($29 billion), Washington ($28 billion), New Jersey ($27 billion), Maryland ($22 billion), and Florida ($17 billion).

Two state governments, Indiana and Nebraska, reported zero outstanding bond debt at the end of 2023.

In per capita terms, the state governments of Hawaii and Connecticut rank first and second, respectively, with outstanding bonds of over $8,000 per resident.

Massachusetts, Delaware, and North Dakota follow, all with outstanding bond debt exceeding $4,000 per capita.

California ranked 10th, with $2,828 bond debt per resident. New York ranked 12th, with $2,487 per capita. Texas reported $2,284 in bond debt per resident, the 14th highest in the country, and Florida ranked 39th, with $785 per capita.

Indiana, Nebraska, Wyoming, Montana and Tennessee each reported less than $250 of bonded debt per resident. Indiana and Nebraska reported no outstanding bonds.

Reason Foundation’s State and Local Government Finance Report totals the liabilities of each state government, as well as the cities, towns, counties, and school districts within each state. This report covers all 50 state governments, over 2,000 county governments, 8,000 municipal governments, and 10,000 school districts, which serve 331 million Americans nationwide.

All figures in Reason Foundation’s State and Local Government Finance Report are sourced from state governments’ own financial reports, most often their annual comprehensive financial reports. The data in this report is from the 2023 fiscal year, the most recent year for which complete data are available. Nevada has not reported 2023 data. Therefore, the data the state reported for 2022 was used. Despite a thorough review, data collection at this scale can result in discrepancies. Please alert us if you identify any errors.

For personalized reports on municipal entities or more detailed information on assets, liquidity, and solvency, please visit the GovFinance Dashboard.

If you have any questions or would like to discuss this data further, please email Mariana Trujillo at mariana.trujillo@reason.org  or Jordan Campbell at jordan.campbell@reason.org.

Related:

Report: State and local governments have $6.1 trillion in debt

The post Report ranks every state’s debt, from California’s $497 billion to South Dakota’s $2 billion appeared first on Reason Foundation.

Of the $6.1 trillion in state and local debt, $2.66 trillion is held by state governments, $1.4 trillion by municipalities, $1.27 trillion by school districts, and $757 billion by counties.

Reason Foundation’s State and Local Government Finance Report finds that $1 trillion is owed by California’s state and local governments, most in the country.

New York’s state and local debt is the second-highest in the nation, at $798 billion, followed by Texas’s $550 billion in state and local debt, Illinois’s $407 billion, New Jersey’s $310 billion, and Florida’s $242 billion.

Additionally, Massachusetts, Pennsylvania, Ohio, Washington, Michigan, Georgia, Maryland, Connecticut, North Carolina, and Colorado each have more than $100 billion in state and local government debt.

At the end of 2023, the most recent year for which complete data is available, 48 of the 50 states had at least $10 billion in total debt.

Only Vermont ($8.8 billion) and South Dakota ($5.9 billion) had less than $10 billion in state and local debt.

State and local government debt includes both short- and long-term obligations—from salaries due at the end of this month to bonds maturing decades from now. The $6.1 trillion in liabilities includes $1.5 trillion in public pension obligations, and $958 billion for retiree health care obligations,

In per capita terms, New York’s state and local debt is the highest in the nation. New York’s state government, cities, counties, and school districts hold debt of $39,491 per resident. This is more than double the national average of about $18,400, according to Reason Foundation’s analysis.

In addition to New York, four other states had per capita state and local debt exceeding $30,000 per resident at the end of 2023: Connecticut ($34,592), New Jersey ($33,338), Illinois ($31,783), and Hawaii ($30,399).

Massachusetts, California, Alaska, North Dakota, Delaware, Wyoming, and Maryland also had state and local liabilities of over $20,000 per resident.

Texas ranked next highest, 13th overall, with $18,872 in debt per Texan. Florida ranked 32nd, with $11,217 per person.

State and local debt was lowest in Idaho, Indiana, South Dakota, Tennessee, and Oklahoma, where the liabilities were less than $7,500 per resident at the end of 2023.

State and local government long-term debt

About 80% of state and local debt is long-term, meaning it is due in more than a year. This long-term debt category consists of bonds, loans, and notes (41% of the total), unfunded public pension liabilities (32%), unfunded retiree health care benefits (20%), and accrued leave payouts (2%).

Nationally, state and local governments reported $4.9 trillion in long-term debt at the end of 2023, Reason Foundation’s State and Local Government Finance Report finds. On a per capita basis, long-term debt amounts to approximately $14,700 in state and local debt for every person in the United States.

California, New York, Texas, Illinois, and New Jersey hold the largest long-term debt totals. Together, these five states account for $2.5 trillion, over half of the national total of $4.9 trillion in long-term liabilities.

There are 14 states where long-term state and local debt exceeds $100 billion, and 36 states where it is more than $20 billion.

In per capita terms, New York reported the most state and local long-term debt, at $31,369 per New Yorker, followed closely by New Jersey’s long-term state and local debt of $31,064 per person.

State and local long-term debt exceeds $20,000 per person in Connecticut ($30,998), Illinois ($28,291), Hawaii ($26,271), Massachusetts ($24,520), and California ($20,280).

Texas ranked 10th, with $15,818 per capita in long-term debt, and Florida ranked 30th, with $8,926 per Floridian.

Idaho, South Dakota, Indiana, Oklahoma, and Tennessee have the lowest long-term debt, with each state having less than $5,200 per resident.

State and local government pension debt

Unfunded public employee retirement liabilities, also known as public pension debt, form when governments set aside fewer assets than required to fulfill promised benefits.

Nationally, state and local governments reported $1.5 trillion in pension debt, or 32% of long-term liabilities, at the end of 2023. On a per capita basis, this state and local public pension debt amounts to approximately $4,600 per American.

California carries the most total state and local public pension debt in the nation, with $269 billion in unfunded liabilities.

Illinois ($228 billion in unfunded liabilities) reported the second most public pension debt in the country.

New Jersey ($98 billion in pension debt), Texas ($96 billion), Pennsylvania ($70 billion), New York ($63 billion), and Florida ($62 billion) all had unfunded pension liabilities exceeding $60 billion at the end of 2023.

These top seven states account for more than half of the nation’s state and local pension debt.

In per capita terms, Illinois has the most unfunded pension liabilities: $17,786 per resident.

Connecticut ($12,997) and New Jersey ($10,601) were the two other states with public pension debt exceeding $10,000 per capita.

Massachusetts, Alaska, Kentucky, and Hawaii are the next highest, with each state’s per capita pension debt reaching over $7,000 per person, well above the national average of about $4,600.

California, despite its large aggregate pension burden, ranks only 8th in per capita pension debt, with $6,796 per resident.

Texas ranks 29th in per capita public pension debt, at $3,277 per resident, and Florida ranks 33rd, with $2,868 per resident.

Two states, Washington and South Dakota, reported no public pension debt in 2023.

State and local government OPEB debt

Other post-employment benefits (OPEB) primarily consist of unfunded retiree health care promised to public employees. Unlike pension benefits, most governments have not pre-funded these obligations, leaving other post-employment benefits (OPEB) almost entirely unfunded.

Nationally, state and local governments report $958 billion in OPEB debt, which accounts for 20% of their long-term liabilities. On a per capita basis, OPEB debt equals about $2,900 per American.

New York reports the largest aggregate OPEB debt among its state and local governments in the country. With $303 billion in OPEB debt at the end of 2023, New York is responsible for about one-third of the nation’s aggregate OPEB debt.

California has the second-highest OPEB debt, with over $147 billion, followed by New Jersey ($98 billion) and Texas ($77 billion).

Eleven other states have at least $10 billion in OPEB debt.

In per capita terms, New York again ranks first, with $15,017 in OPEB debt for each New Yorker.

New Jersey follows with $10,599 per capita OPEB debt, Delaware with $8,448 per capita, Connecticut with $6,657, and Massachusetts with $6,308.

California ranks 8th, at $3,712 per resident. Texas ranks 10th, at $2,649, and Florida ranks 29th, at $689.

Alaska, Ohio, Utah, Idaho, and South Dakota report OPEB debt of less than $110 per resident.

State and local outstanding bonded debt

Bonds, loans, and notes represent the portion of state and local liabilities explicitly borrowed in credit markets. Unlike pensions or OPEB, which accumulate as estimated unfunded promises, these instruments are contractual debt obligations with fixed repayment schedules.

Nationally, state and local governments report $2 trillion in outstanding bonds, loans, and notes, which represents 41% of their long-term liabilities. On a per capita basis, this equals $6,100 per resident.

California leads with the largest stock of outstanding bonds and loans, totaling $334 billion across state and local issuers.

Texas owes $287 billion in outstanding bonds and loans, followed by New York ($197 billion), Illinois ($98 billion), and Florida ($81 billion).

Together, these five states account for about half of all outstanding municipal bonds and loans.

The per capita rankings differ significantly. Hawaii owes $14,295 per Hawaiian in bonds and loans.

Connecticut and Massachusetts follow, owing more than $10,000 per resident. Texas, New York, and North Dakota, with more than $9,000 per resident, are next.

Montana, Wyoming, Idaho, and Alabama each have less than $2,000 of bonded debt per resident.

Reason Foundation’s State and Local Government Finance Report totals the liabilities of each state government, as well as the cities, towns, counties, and school districts within each state. This report covers all 50 state governments, over 2,000 county governments, 8,000 municipal governments, and 10,000 school districts, which serve 331 million Americans nationwide.

All figures in the State and Local Government Finance Report are sourced from the financial reports of state and local governments, most often their annual comprehensive financial reports. The data is from the 2023 fiscal year, the most recent year for which complete data are available. Nevada and a handful of cities and counties across the country have not reported 2023 data. Therefore, the data reported for 2022 was used. Despite a thorough review, data collection at this scale can result in discrepancies. Please alert us if you identify any errors.

For personalized reports on municipal entities or more detailed information on assets, liquidity, and solvency, please visit the GovFinance Dashboard.

If you have any questions or would like to discuss this data more, please email Mariana Trujillo at mariana.trujillo@reason.org or Jordan Campbell at jordan.campbell@reason.org.

Related:

Report ranks every state’s total debt, from California’s $497 billion to South Dakota’s $2 billion

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This dashboard compiles the key elements of governmental financial statements for fiscal years 2020, 2021, and 2022, covering all 50 states and the top 100 municipalities, counties and school districts.

A historical challenge in comparing the financial health of state and local governments has been that these entities do not prepare their financial statements in a machine-readable format. In some cases, certain reporting entities also fail to adhere to governmental accounting standards generally accepted in the United States.

Reason Foundation has responded to this gap by developing a proprietary automated approach to data extraction of key elements from the financial statements, the results of which are subsequently confirmed by manual human review.

We hope to provide valuable insights for policymakers, journalists, market participants, and other stakeholders by placing their state, municipality, county, or school district in contrast to their peers – and the broader context of the country.

At the end of fiscal 2022, five state governments had more than $200 billion in total liabilities: California, Illinois, New York, New Jersey and Texas.

Massachusetts had over $100 billion in total liabilities, Connecticut and Washington had over $90 billion, and Pennsylvania, Florida and Maryland each had over $60 billion in total liabilities at the end of fiscal 2022.

From the 2020 fiscal year through the 2022 fiscal year, 47 states saw increased revenues. Alaska, Michigan, and Wyoming were the three states that did not increase revenues.

During the same 2020-2022 period, total assets, such as growth in cash, investments, receivables, land, buildings, and infrastructure, increased for all 50 states.

The increase in assets helped 49 states, every state except North Dakota, reduce its state debt ratio, which is defined as the proportion of total liabilities to total assets from fiscal year (FY) 2020 to FY 2022.

At the end of the 2022 fiscal year, the 50 state governments held $1.03 trillion in employee-related debt, including $502 billion in net public pension liabilities and $524 billion in net other post-employment benefit liabilities, such as promised medical benefits for retirees.

For the tool’s full interactivity and options, please visit https://debttrends.transparencyproject.reason.org.

State debt: California, Illinois, New York, New Jersey and Texas each have over $200 billion in total liabilities

County debt: Los Angeles, Philadelphia, Denver, Miami-Dade and Cook counties among worst in nation

City debt: New York has more than four times the liabilities of Chicago, Los Angeles, Houston and other cities

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At the end of fiscal 2022, Houston and the District of Columbia also had over $20 billion in total liabilities.

Reason Foundation finds that New York City’s liabilities reached $34,567 per capita in 2022, the highest in the nation. The next highest per capita liabilities were in the District of Columbia ($29.4k per capita), Chicago ($26.9k per capita), and Atlanta ($21.2k per capita).

At $18,182 per capita, Yonkers, New York, surprisingly had the next highest liabilities, followed by Austin, Texas, with over $16,653 in liabilities per capita.

When looking at cities' public pension systems, New York and Chicago stand out above the rest of the nation. At the end of 2022, New York City had over $42 billion in pension liabilities, and Chicago had over $35 billion.

On a per capita basis, Chicago's public pension liabilities ($12,903 per capita) are well over double New York City's ($4,810 per capita). With $6,553 in pension liabilities per capita, Portland also ranks worse than New York City.

Cincinnati and Pittsburgh had over $3,000 per capita public pension liabilities.

In 2022, governments representing the 100 most populous municipalities across America owed $251.2 billion in employee-related debt, including $126.4 billion in net public pension liabilities and $124.8 billion in net other post-employment benefit liabilities, such as medical benefits promised to retirees.

Ten municipalities—New York, Chicago, Austin, Phoenix, Houston, Portland, Boston, San Jose, Fort Worth, and San Diego—account for 80.1% of the total employee-related debt among the 100 most populous municipalities.

In 2022, New York and Chicago were responsible for 67.3% of the total employee debt held by the country’s 100 largest municipalities.

Several entities in this analysis are cities that have consolidated their operations and financial reporting with the overlapping county. Effectively, these jurisdictions are merged into a single administrative entity. These consolidated governments include Nashville-Davidson (TN), Jacksonville-Duval (FL), San Francisco, Honolulu, Denver, and Philadelphia. Due to their structure and financial reporting practices, these entities cannot be fairly separated into distinct city and county categories. These entities are included in the larger category of counties within this report because their geographic and jurisdictional boundaries match those of the formerly independent counties.

A detailed debt summary for the 100 most populous municipalities from 2020 to 2022 is here: https://debttrends.transparencyproject.reason.org/municipal.

Overview of Government Financial Transparency Project: State and local debt trends 2020-2020

State debt: California, Illinois, New York, New Jersey and Texas each have over $200 billion in total liabilities

County debt: Los Angeles, Philadelphia, Denver, Miami-Dade and Cook counties among worst in nation

City debt: New York has more than four times the liabilities of Chicago, Los Angeles, Houston and other cities

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Other counties with significant liabilities include Miami-Dade County, with $29.2 billion in total liabilities at the end of 2022. Cook County had $19.5 billion in liabilities, Nassau County ($14.2 billion), Harris County ($10.6 billion), and Santa Clara County ($10.2 billion) also had significant liabilities.

Several entities in this analysis are cities that have consolidated their operations and financial reporting with the overlapping county. Effectively, these jurisdictions are merged into a single administrative entity. These consolidated governments include Nashville-Davidson (TN), Jacksonville-Duval (FL), San Francisco, Honolulu, Denver, and Philadelphia. Due to their structure and financial reporting practices, these entities cannot be fairly separated into distinct city and county categories. These entities are included in the larger category of counties within this report because their geographic and jurisdictional boundaries match those of the formerly independent counties.

When looking at public pension debt in counties, Cook County's $10.8 billion in liabilities was the most in the United States at the end of 2022, followed by Los Angeles County's $7 billion in pension debt.

Miami-Dade County, Santa Clara County, San Diego County, Orange County, and Prince George's County each had more than $2 billion in public pension liabilities at the end of 2022.

At the end of 2022, the governments representing the 100 most populous counties across America owed $448.6 billion in total debt, including an aggregate of $151.2 billion in employee-related benefits debt—$71.3 billion as net public pension liabilities and $79.9 as net other post-employment benefit liabilities, such as medical benefits promised to retirees.

The 10 most indebted counties, in terms of total liabilities, were responsible for more than half (56.5%) of the total liabilities held by the 100 most populous counties.

A detailed debt summary for the most populous counties from 2020 to 2022 is here https://debttrends.transparencyproject.reason.org/county.

Overview of Government Financial Transparency Project: State and local debt trends 2020-2020

State debt: California, Illinois, New York, New Jersey and Texas each have over $200 billion in total liabilities

County debt: Los Angeles, Philadelphia, Denver, Miami-Dade and Cook counties among worst in nation

City debt: New York has more than four times the liabilities of Chicago, Los Angeles, Houston and other cities

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On a per capita basis, Reason Foundation finds Connecticut’s total liabilities—$27,031 total liabilities per capita—were the worst in the nation at the end of the 2022 fiscal year, followed by New Jersey ($24.2k in total liabilities per capita), Hawaii ($19.4k per capita), Illinois ($19.4k per capita), and Wyoming ($18.6k per capita). 

When looking at state public pension debt, Illinois has nearly double the pension liabilities of any other state. At the end of fiscal 2022, Illinois had $139.8 billion in public pension liabilities, New Jersey had $75.1 billion, California had $54.2 billion, Connecticut had $36.1 billion, Massachusetts had $34.8 billion, and Texas had $30.9 billion. 

At the end of 2022, Illinois had $10,915 in pension liabilities per capita, followed by Connecticut ($10k per capita), New Jersey ($8.1k per capita), Kentucky ($5.6k per capita), Massachusetts ($5k per capita), and Hawaii ($4.3k per capita).  

At the end of the 2022 fiscal year, the 50 states held $1.03 trillion in employee-related debt, including $502 billion in net public pension liabilities and $524 billion in net other post-employment benefit liabilities, such as promised medical benefits for retirees.

Ten states—Illinois, New Jersey, California, Texas, New York, Connecticut, Massachusetts, Pennsylvania, Kentucky, and Maryland—account for 84.7% of the total employee-related debt among all 50 states.

For detailed information about each state's debt and financial condition, please visit https://debttrends.transparencyproject.reason.org/state.

Overview of Government Financial Transparency Project: State and local debt trends 2020-2020

State debt: California, Illinois, New York, New Jersey and Texas each have over $200 billion in total liabilities

County debt: Los Angeles, Philadelphia, Denver, Miami-Dade and Cook counties among worst in nation

City debt: New York has more than four times the liabilities of Chicago, Los Angeles, Houston and other cities

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Other cities held less than 3% of their assets as cash, meaning they had limited liquidity. Liquidity measures are important because they indicate whether an entity can pay its bills as they fall due. Employees, vendors, and debt holders must all be paid in cash, so cities must either convert other assets into cash on a timely basis or generate new cash through taxes or other forms of revenue. 

This analysis reviews the performance of America’s 10 most populous cities across a range of standard financial metrics related to debt and liquidity. 

Debt ratio 

An entity’s debt ratio is calculated by dividing its total liabilities by total assets. It reveals roughly what proportion of the entity’s assets are debt-financed versus owned outright. As with a business or household, a heavily indebted city must devote a larger share of its future cash flow toward debt service and has less financial flexibility with which to consider new priorities. 

At the close of fiscal year 2022, New York City, Chicago, and Philadelphia all held more debt than the sum value of their assets. New York City had more than twice as much debt as assets. Even if these cities were able to liquidate all their storm drains, asphalt, and other capital assets at the prices they paid for those goods, they still would not be able to pay off all their debts.  

The cities among this group with the lowest debt ratios (and, thus, the greatest degree of financial flexibility) were San Diego, Los Angeles, and San Jose. 

Unrestricted net position 

Another important measure of a city’s long-term solvency is its unrestricted net position. This is the amount by which the city’s assets exceed its outstanding debt plus the amounts it is required to set aside for specific purposes, like future debt service, maintenance of infrastructure, or other purposes established through bond covenants or local law. Unrestricted net position is essentially the amount of “cushion” a city has after meeting all its obligations. 

Among the 10 most populous cities in America, only Los Angeles held a positive unrestricted net position at the close of fiscal year 2022. Some cities held deep deficits in unrestricted net position, headlined by New York City at $186.3 billion. 

Revenues less expenditures 

During fiscal year 2022, nine of America’s 10 most populous cities generated enough revenue to finance their expenditures. City revenues include money received in taxes, fines, fees, and grants from federal, state, or private sources. An entity’s overall financial position will deteriorate over a year if expenditures exceed revenues but may improve if revenues exceed expenditures. 

Only in Chicago did expenditures exceed revenues, to the tune of $510 million.

In New York City, revenues exceeded expenditures by $10.1 billion, or $1,150 per resident. On a per-resident basis, the top-performing cities among this group were New York City, Houston, and Los Angeles, while the worst-performing cities were San Diego, San Jose, and Chicago. 

Quick ratio 

Not all assets are financial. For example, the value of physical assets like buildings or roadways are held on a city’s balance sheet, but cannot be used to settle debts as they fall due. To pay its bills, a city must have sufficient financial assets available. A common way of measuring a city’s ability to pay debts coming due is to compare its financial assets to the total of its current liabilities at the date of the balance sheet. The so-called “quick ratio” divides all assets that are either cash or expected to be quickly converted into cash (including short-term assets and receivables) by debts that must be paid within one year, including debt servicing costs, vendor payments, employee payroll, utilities, and other short-term expenses.  

A value of 1 or more indicates that the entity holds sufficient financial assets to pay its bills timely, although most financial analysts prefer that an entity hold a quick ratio well above 1. 

At the close of fiscal year 2022, two of America’s 10 most populous cities held a quick ratio of less than 1—Phoenix and San Antonio. Chicago and New York City held quick ratios slightly greater than 1—indicating short-term liquidity, even though these cities suffer from long-term indebtedness exceeding assets.  A city can improve short-term liquidity measures like a quick ratio by issuing new long-term debt, even though this action may cause its overall balance sheet to deteriorate. 

The cities in this group with the highest quick ratio include San Diego, San Jose, and Los Angeles. 

Quality of receivables 

While a quick ratio is an important indicator of short-term liquidity, it includes within the denominator receivables that may not be turned into cash on a timely basis. A city’s external auditors are responsible for evaluating its outstanding receivables to make a judgment on the quality of those receivables, but external auditors must also rely on the representations of city management. Management may be reluctant to recognize and expense tax assessments or other revenue sources that are uncollectible for a variety of reasons, including the resulting deterioration that action would have on the city’s financial statements. 

Accounting practices generally accepted in the United States require cities to disclose summary information about their receivables in the footnotes of the financial statements. However, financial analysts can glean insight into the quality of receivables by examining a city’s receivables as a share of annual revenues. 

If receivables amount to a high share of revenue, this indicates the city may be having a difficult time collecting amounts owed. At the close of fiscal year 2022, receivables approached or exceeded 40% of annual revenues in New York City, Chicago, and San Diego. In other words, nearly five months’ worth of revenues has not been collected in these cities, creating potential complications for the cities’ cash flow. By contrast, receivables amounted to only 6.6% of annual revenues in San Antonio and 10.8% in Phoenix.

Cash assets 

A final important method of examining a city’s short-term liquidity is by examining the proportion of its assets held as cash or cash equivalents (including short-term investments that will become cash within 90 days of the date of the balance sheet). 

By this measure, the most liquid of the 10 most populous cities are Philadelphia, San Jose, and San Diego. San Antonio and Phoenix hold very low shares of their total assets as cash—reinforcing their lack of liquidity as measured by quick ratio. 

Overview of Government Financial Transparency Project: State and local debt trends 2020-2020

City debt: New York has more than four times the unfunded liabilities of Chicago, Los Angeles, Houston and other cities

County debt: Los Angeles, Philadelphia, Denver, Miami-Dade and Cook counties among worst in nation

State debt: California, Illinois, New York, New Jersey and Texas each have over $200 billion in total liabilities

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Unfunded retirement health care obligations for public employees now exceed unfunded pension liabilities, representing a larger share of the long-term fiscal debt held by U.S. states and municipalities. In 2022, the most recent year available with full data, net OPEB liabilities for the largest governments reached $789 billion, surpassing $753 billion in unfunded pension liabilities. This marks a critical shift in the debt composition of American states and local governments

Although total OPEB obligations tend to be much smaller in dollar terms than traditional pension obligations, they now represent a larger share of municipal debt. This is because, while governments generally have lower OPEB liabilities than pension liabilities, they often fail to fund OPEB funds as thoroughly as pensions, leading to a greater degree of underfunding for health care benefits.  

Like pensions, it is safer and more cost-efficient to set money aside in advance to pay out these OPEB obligations. By pre-funding these benefits, governments can invest the funds over time, allowing those investments to grow and generate returns, which reduces the overall cost of providing the promised benefits. However, many governments have not adhered to this approach, preferring a pay-as-you-go (PAYGO) funding approach resembling Medicare—using the OPEB contributions of current employees to pay for the health care benefits of retired employees.  

Another reason for the gap between unfunded OPEB and pension debt is that OPEB liabilities are discounted more conservatively, resulting in a higher present value. The lower discount rate for OPEB liabilities is driven by its significant differences in funding policies, as required by Governmental Accounting Standards Board (GASB) guidelines.

Summed together, unfunded public employee pensions plus the health care benefits of America’s largest state and local governments totaled $1.5 trillion, equivalent to around 5% of the national federal debt or 6% of the U.S. gross domestic product in 2022. 

Fiscal year 2022 is the latest year for which financial records are available for all U.S. state governments and the largest municipal governments at the time of writing. This analysis is based on data from Reason Foundation’s Debt Trends for State and Local Governments project, which compiled financial reports from every U.S. state and the 100 most populous cities, counties, and school districts into an interactive dashboard.

Public employee healthcare funding functions more like Social Security  

While pay-as-you-go (PAYGO) financing of retiree health care benefits reduces immediate costs, it significantly increases long-term costs by forgoing the investment gains that pre-funding would have provided. In fact, the National Association of State Retirement Administrators found over the past 30 years, 63% of public pension revenue came from investment income.  

Public officials might opt not to pre-fund OPEB liabilities because these obligations are generally less protected by law than pensions. Unlike pensions, in the event of a fiscal crisis, governments may potentially default on these healthcare retirement promises. 

Though not as constitutionally protected, state and local government OPEB obligations can be even more volatile than pension obligations, as they expose municipalities to uncertain and rising health care costs—especially as geriatric health care resources become more in demand with the aging of the U.S. population. 

OPEB debt remains stable as pension debt falls 

Overall, unfunded pension obligations in 2022 are lower than they were in 2020, with unfunded OPEB falling about 3.6% from 2020 to 2022 and unfunded pension obligations (NPL) falling by 27% in the same period. This trend, observable in Figure 1, has led to NPL, in total, dropping below unfunded OPEB obligations.  

There are several possible explanations for the 27% reduction in pension debt from 2020 to 2022. Favorable markets have led to outstanding investment returns and growth in public pension assets during this period. At the same time, governments have also dedicated larger supplemental contributions to paying down unfunded public employee obligations.  

During the COVID-19 epidemic, many states and local governments used federal pandemic aid to amortize their pension debt, bypassing explicit (yet, in practice, soft) restrictions in the federal law prohibiting them from doing so. Evidence indicates there was a modest increase in state and local pension contributions relative to the recommended actuarial amounts.  

Not all the change can be attributed to contribution increases. The year 2021 saw record investment return outcomes for public pensions. According to the Reason Foundation Annual Pension Report, the average rate of return in 2021 was 25.3%. Some of the 27% decrease in unfunded pension liabilities that made OPEB surpass NPL from 2020 to 2022 should be attributed to this unusual market appreciation, which is expected to reverse in the next market downturn as returns converge to historical averages.  

A changing municipal debt landscape 

The trend of unfunded post-retirement health care benefits now surpassing unfunded pension benefits is seen across many levels of state and local governments.  

This notable shift in the makeup of state and local government liabilities draws attention to a fiscal challenge that has been developing for the past two decades. The longer governments delay addressing unfunded public employee retirement health care obligations, the more expensive they become.

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