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Dominic Anthony Walsh\/Houston Public Media \/ Houston Public Media<\/p>\n
Houston housing director Mike Nichols, left, and public safety director Larry Satterwhite speak to the Houston City Council and Mayor John Whitmire in October 2025.<\/p>\n
More than $54 million in unbudgeted overtime across three departments, up to $12 million in unexpected salary hikes for firefighters and the loss of more than $50 million in planned property tax revenue \u2014 these are the fiscal headaches felt by Houston city officials as they grapple with a second year of a record-breaking budget gap.<\/p>\n
The city controller’s office forecasts a $174 million budget deficit by the end of the fiscal year in June, exceeding the record-setting $145 million gap in 2025. <\/p>\n
“This is about recognizing a pattern and being accountable to changing that pattern,” City Controller Chris Hollins told the city council during a fiscal report in early April. “Because the reality is simple \u2014 we cannot continue to make decisions that don\u2019t align with reality and expect anything besides reality coming back around to hit us in the face.”<\/p>\n
Sign up for the Hello, Houston!<\/a> daily newsletter to get local reports like this delivered directly to your inbox.<\/p>\n Aside from committing to not raising property taxes, Mayor John Whitmire has held his “solid plan to balance the budget without raising property taxes” close to his chest. <\/p>\n In a statement, Whitmire said his administration has “implemented efficiencies, eliminated waste, fraud and duplication, which have helped reduce the shortfall. That work continues.”<\/p>\n Overtime overages<\/b><\/p>\n In 2025, three departments \u2014 solid waste, police and fire \u2014 exceeded their general fund overtime budgets by more than $70 million<\/a>. <\/p>\n After the city spent nearly $140 million on overtime from the general fund last fiscal year, the city council approved an overtime budget of only $64 million for 2026. <\/p>\n Now, the city controller projects<\/a> the three departments will exceed that budget by about $54 million. <\/p>\n Council member Sallie Alcorn, chair of the budget and fiscal affairs committee, said the departments and the city council must change their approach to spending and budgeting. <\/p>\n “Having fire, police, and solid waste really look at who\u2019s using overtime, how it\u2019s being used, making sure it\u2019s being used the way it\u2019s supposed to be used,” she said, “and, obviously, yes, we are going to have to look at a different way of budgeting over time to give us a more realistic picture of the costs in the year ahead.”<\/p>\n According to the controller’s office, the fire department is on track to exceed its overtime budget by about $39 million this year after a nearly $43 million overage last year. <\/p>\n Hollins’ office projected the top 10 overtime earners within the department will more than double, and in some cases more than triple, their annual salaries. <\/p>\n Alvaro ‘Al’ Ortiz \/ Houston Public Media<\/p>\n Marty Lancton, president of the Houston Professional Fire Fighters Association, speaks at a press conference held at the entrance to the City Hall Annex building, in downtown Houston in August 2017.<\/p>\n “If firefighters have overtime dollars, that\u2019s because they\u2019re having to work it, so that they\u2019re away from their families, and we\u2019re working 24 hours at a time,” firefighter union president Marty Lancton said. “It\u2019s those kinds of things \u2014 (the controller’s top-ten presentation) \u2014 that get people really aggravated and confused. Creating honesty is about creating a picture that actually paints an accurate picture, not one that\u2019s clickbait.”<\/p>\n While the police department offsets some of its overtime spending through reimbursements to special purpose revenue funds, the fire department doesn’t enjoy the same ability to recoup overtime back into its own budget. Instead, reimbursements for firefighter overtime flow back into the general fund without counting against the department’s spending.<\/p>\n For example, the city of Houston is slated to receive a $65 million grant<\/a> for public safety initiatives ahead of the FIFA World Cup, with Houston hosting a total of seven international soccer matches in June and July. A spokesperson for Whitmire said it will be used, in part, to cover police and fire overtime. The police department will recoup its costs directly through the grant, while the city is expected to place the fire department reimbursements back into the general fund. <\/p>\n Lancton also expects overtime to track down as additional recruits come onboard. The city’s blockbuster deal<\/a> with the union in 2024 \u2014 resolving an eight-year dispute through $650 million in back pay as well as an estimated $850 million in wage hikes over five years \u2014 has bolstered the workforce. <\/p>\n “This contract really was sending a clear message \u2014 it is a new day, it is a new administration, and the focus on public safety is real,” Lancton said. More than 660 firefighter cadets have graduated since then, Lancton said, which “saves taxpayers millions of dollars.”<\/p>\n Whitmire’s office did not directly address a question about overtime spending.<\/p>\n Unexpected arbitration<\/b><\/p>\n As part of the new contract, firefighters are eligible for \u201cescalator\u201d raises if the union works with the city to bring in new public safety revenue. <\/p>\n That’s what happened last year \u2014 according to an arbitrator, who had to settle a dispute between the city and union over the wage hike.<\/p>\n A bill passed during the 89th Texas Legislature is projected to bring in $13 million in additional reimbursements for ambulance services. Because the union and department leadership worked together to support the bill, the arbitrator found, the city must issue back pay through September and raise salaries by an additional 3%. <\/p>\n “The mayor thought they should be paid the lower number, and it went to arbitration, and then the city lost,” Hollins said. “Now, taxpayers are going to be responsible for significant back pay to firefighters on top of the already costly back pay that this agreement was intended to resolve in the first place.”<\/p>\n Dominic Anthony Walsh \/ Houston Public Media<\/p>\n Houston Mayor John Whitmire speaks in favor of a proposed ordinance on April 8, 2026.<\/p>\n The dispute marked the first public disagreement between Whitmire’s administration and the firefighters’ union. <\/p>\n “I don\u2019t think in a perfect world the mayor would be, you know, thrilled that any of the stuff would have had to happen,” Lancton said. “Bureaucracy is real. I don\u2019t like bureaucracy, but you know, I find every way to ensure that we\u2019re doing things together.”<\/p>\n Whitmire’s office did not respond to requests for comment on the arbitration result. <\/p>\n His administration did not notify city council members \u2014 or the public \u2014 of the arbitrator’s decision until April. It was finalized on Feb. 27, according to a copy shared with Houston Public Media by the union. <\/p>\n The city controller estimates the change will cost $10 million to $12 million this fiscal year. <\/p>\n Other grievances settled in the union’s favor included a per-member allowance of $300 to $1,500 for uniforms and a reallocation of $250,000 for laundry services in stations.<\/p>\n No tax hike leaves few choices<\/b><\/p>\n Whitmire’s budget for 2025 called for a modest property tax increase \u2014 approximately 3%. <\/p>\n But in October, his administration announced plans to keep the rate flat. Without the increase, the city’s revenue was projected to fall by about $52 million. <\/p>\n The city council approved the request to keep the rate flat in a 12-3 vote. Budget chair Alcorn was among those who opposed the flat rate. <\/p>\n “Eventually we are going to have to raise revenues to cover the public safety contracts and the other essential services the city provides,” Alcorn told Houston Public Media last week. “Whether it\u2019s this year or in a coming year, we are going to have to meet that moment.”<\/p>\n Lucio Vasquez \/ Houston Public Media<\/p>\n Pictured is Houston City Council member Sallie Alcorn.<\/p>\n In addition to the annual raises tied to the firefighters’ contract, the police union won an $832 million agreement<\/a> last year, raising officer pay by more than 36% over five years. <\/p>\n At his State of the City event<\/a> in February, Whitmire stated he would not raise property taxes, which have been flat since he took office in 2024. <\/p>\n \u201cWe’re not going to raise taxes in this next budget cycle,\u201d Whitmire said. \u201cWe’re going to look for efficiencies, collaboration, eliminate corruption, conflicts. It can be done, and it will be done.\u201d<\/p>\n Without additional revenue, the administration’s path to a balanced budget likely includes slashed spending. <\/p>\n In 2025, his administration cut spending across almost all departments by nearly $60 million. <\/p>\n At this time last year, about 2,700 employees \u2014 more than 10% of the municipal workforce \u2014 were considering an early retirement buyout offer<\/a>. About 1,000 workers retired, and the program was projected to save $35 million per year from the city\u2019s $3 billion general fund.<\/p>\n The program was framed as a way to stave off involuntary layoffs.<\/p>\n![\"Marty](\"https:\/\/www.europesays.com\/us\/wp-content\/uploads\/2026\/04\/Photo1-1000x750.jpg\")
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