City Budget
4:42 pm
Wed April 18, 2012

Proposed City Budget: $25 Million in Unmet Needs, Even With Property Tax Increase

The city is proposing a 1.8 cent increase in property taxes. That’s just a hair under the maximum increase allowed – 1.85 cents – without a special tax election.

That’s one of the findings in the City of Austin’s preliminary, proposed budget for Fiscal Year 2013, presented to the City Council this morning.

Going off current median home values – approximately $182,000, but due to change once the county sets new property valuations – that’s a $33 annual increase.

The increase would only fund existing initiatives approved by the City Council: preserving the city’s two- officers-per-1000 residents police policy, previously agreed to employee raises, and offsetting rising health insurance costs.

“The forecast we present to the City Council is our funding projections to meet services at existing levels,” says city budget officer Ed Van Eenoo. “It’s not a forecast that includes funding for program enhancements or new services.”

Without a tax raise, the city would face a $15.1 million deficit – just to meet its existing services.

That’s not to say that city departments aren’t asking for increased funding. “Our departments this year have identified a total of $24.8 million in funding requests,” Eenoo says.

Filling cuts to federal affordable housing grants is expected to loom over this budget season. A  reduction in Housing and Urban Development’s Community Development Block Grants and HOME grants means $1.7 million less in federal housing assistance.

Changes and improvements to the Planning Department are also set for discussion; KUT News has previously reported on the department’s permitting backlog, and Van Eenoo notes most permitting fees haven’t been increased since the 1990s.

Still, Eenoo says the situation is an improvement over previous years, when the city budgets showed budget deficits even at the higher allowable tax increase; the Fiscal Year 2010 budget was balanced by cutting over 100 (largely unfilled) positions, and foregoing previously agreed to pay raises. “We’re still seeing the benefits of that today, and that’s why our financial forecast picture is much different today, where we’re projecting a balanced budget in FY 2010 at a tax rate below the rollback rate – a stark contrast to where we were three years ago.”