For decades, the City has simply issued debt to pay for construction. The City currently has about $1.7 billion in debt as a result of bond obligations for street and drainage projects. The City pays nearly $150 million per year in interest on that street and drainage debt accrued in years past. The most difficult task is that we must pay off past debt while continuing to rebuild our street and drainage system. 11.8 cents of every $100 of property value collected from property owners is currently going to pay off the debt incurred on previous street and drainage projects.
ReBuild Houston is a Pay‐As‐You‐Go model that is distinct from the previous "put it on the credit card" model. As the old debt is paid off, the balance of funds from the 11.8 cents reserved by City Council via Drainage Utility Ordinance No. 2011‐254 will now go toward new street and drainage projects via Pay‐As‐You‐Go funding. As more debt is paid off – more cash projects will be funded. And there is a bonus as well– new projects will now be paid for in cash which means we will get about twice as much product for our dollar.