Houston mayor admits city is broke and proposes tax hikes and cuts to fix the deficit

Texas city loses $45 Million after housing project fail. Houston may be forced to send federal funding back after the city was unable to build an affordable housing project. The city may have to send the federal funds back after failing to build a housing project in the city's poorest area.

Houston Mayor John Whitmire said the city is "broke" and proposed cuts to city spending and possible tax hikes to fill the deficit. Whitmire proposes tax hikes and cuts to remedy massive budget deficit. Houston mayor admits city is ‘broke’ and proposes tax hike and cuts.

Democrat John Whitmire, who was elected in December, gave the bleak warning at a City Hill meeting this week. He proposed a five percent cut across all city spending. Mayor says he inherited a $160 million deficit and wants to cut spending by 5 percent. Whitmire was elected to office in December and took office in January.