Houston to Sell $1.1 Billion Bonds for Firefighter Settlement
Article 0 Comments Houston plans to sell more than $1 billion in bonds to settle a firefighters’ pay dispute and the city’s chief financial officer is warning it will swell the annual budget shortfall by as much as 75%. The fourth-largest US city will need to sell so-called judgment bonds to cover a settlement that Mayor John Whitmire struck with the firefighters’ union earlier this month, City Controller Chris Hollins told reporters Tuesday. Over the 25- or 30-year life of that obligation, annual interest payments probably will amount to roughly $40 million, he said. City officials have estimated the interest rate will be around 5.5%, according to documents provided by the mayor’s office. Meanwhile, the new debt will expand the city’s “structural budget shortfall” to as much as $280 million a year from an estimated $160 million to $200 million in the current cycle, Hollins added. Read More: Houston’s $100 Million Ballot-Box Fight Over Firefighter Raises Houston operates on an annual budget of just over $6 billion. The firefighters’ union and city leaders had been locked in a bitter legal dispute over pay equity for eight years before Whitmire took office in January on a pledge to come to terms....