Comparative analysis of tax and user charge burden for residents of the 50 largest U.S. cities

Fitch Ratings
Geoffrey Davenport
April Yidan Zhang, Ariel Shuchun Yang, Hellen Chen, Hilary Huiyuan Song, Jaspreet Kaur, Kyle Griswold

Fitch Ratings is one of the three nationally recognized statistical rating organizations (NRSRO) designated by the U.S. Securities and Exchange Commission in 1975. The Public Finance Division at Fitch Ratings plays an important role in assessing the financial health of different cities. To understand the debt capacity of the 50 largest cities in the U.S., a Capstone team was requested to analyze the tax burden and user charge burden born by each city’s residents, and create a tool to facilitate that analysis in the future. The team conducted a literature review and a brainstorming session with the client, and reviewed data to determine the added impact of state and county taxes on each city resident. In its final report, the team described its methodology for assessing municipal debt capacity, applied that methodology to each city, and provided an analysis of the results. With this information, each city’s ability to manage the additional cost of new debt will become clearer.

Areas Of Impact