Not a list you want to be on: Baton Rouge ranks in top 5 overleveraged US cities
Baton Rouge has one of the heaviest debt loads relative to its revenues of any municipality in the U.S., according to a recent report from JP Morgan Chase. According to the study, some 52% of city-parish dollars are obligated to pay for unfunded pension liabilities, retiree healthcare costs, and general bonded debt for programs like the city-parish’s sewer system upgrade.
“U.S. cities and counties have substantially more debt relative to their revenues than U.S. states,” the report says. “While most have several years to undertake remediation measures, some very difficult choices will be required in order for them to meet all of their future obligations.”
The choices outlined in the report for Baton Rouge are stark. Over the next 30 years, the city-parish, in a worst-case scenario, will have to either increases taxes by 24%, cut non-pension spending by 20% or increase worker contributions to the system by 525% in order to meet its obligations.