The National League of Cities’ 2026 Municipal Infrastructure Conditions Report finds that municipalities are increasingly funding capital projects out of current revenue rather than borrowing — a shift the NLC attributes to “both fiscal caution and limited financing capacity.” Property taxes, which account for roughly 60 percent of municipal tax revenue and are relied on by nearly 90 percent of cities, increasingly cover both operating costs and capital cash needs.
Nationally, that looks like a contradiction: Major municipal bond underwriters expect the aggregate market to set another record year, near $600 billion. But that masks a separate trend inside typical city budgets: governments leaning harder on cash than a few years ago, against a backdrop where the stakes keep rising. While the American Society…
