I've spent a lot of time around local government officials and staff, and I can say this confidently: Most cities are completely unprepared for a world where federal money is not easy to get. And since we're talking about rising interest rates — and the potential loss of the ability to suppress them — it's important to point out how Houston's decades-long decline in Net Financial Position was temporarily softened by a unique set of circumstances: Historically low interest rates allowed the city to both borrow more and spend more while simultaneously paying less in interest. When interest rates rise, refinancing to a lower rate isn’t possible, and so more of the city’s budget must go toward paying interest.