Houston controller projects $245.1 million year-end balance; $100 million drainage transfer and $26 million sales-tax adjustment reshape outlook

The city controller told the joint Service Delivery and Budget & Fiscal Affairs committees that the Controller's Office is projecting a $245,100,000 ending fund balance for fiscal 2025, based on results through Jan. 31, 2025.

The projection is $119,900,000 lower than the finance department's figure, Controller Chris Hollins said, a gap the controller tied largely to a planned transfer from the general fund into the dedicated drainage and street renewal fund following the Texas Supreme Court ruling. “We are going off to status quo,” Hollins said, adding the court ruling requires the city to make certain transfers unless and until notified otherwise.

The monthly report also recorded a $26,000,000 audit adjustment in the February remittance tied to sales-tax receipts that the state comptroller determined had been allocated to the wrong jurisdictions and were remitted to Houston dating back to 2019. Hollins said the state returned that $26,000,000 in the March remittance and has agreed to a 43-month, 0% interest repayment plan beginning in April for the jurisdictions that were overpaid.

Why it matters: The projected reduction relative to the finance department’s estimate and the required drainage transfer change how much discretionary…