City manager presents $3.5B budget to City Council

AUSTIN -- After taking about one month off, Austin City Council members came back together to talk budget.

The City Council met at Austin Energy, while the City Council chambers undergo renovations to make room for the new 10-1 City Council, and started the meeting off on a high note by singing 'Happy Birthday.' Austin Police Chief Art Acevedo turned 50 Thursday, and Council Member Mike Martinez will turn 45 later next month.

After a bit of song and dance, it was back to business. City Manager Marc Ott, and his staff, presented a $3.5 billion budget for the 2015 fiscal year. Their proposal decreases the property tax rate from 50.27 cents per $100 home valuation to 48.09 cents.

"We've tried to be mindful of the affordability challenge that we're all concerned with here in Austin, and that's evident in our ability to recommend a budget that has a 2.2 cent decrease," said Ott.

A lower tax rate doesn't equate to a lower tax bill.

Home appraisals have increased nearly 11 percent, so if the rate is approved, a median priced home of $196,500 will pay $1.19 each month.

The proposal also calls for a $12.13 monthly fee increase for the average homeowner in from various departments.

Back in April, when the City Council first received the financial forecast, Austin Water Utility was planning a rate increase of more than $4 a month for the average customer to combat a significant loss of revenue due to the drought. Instead, the utility cut its budget by $29.9 million. Assuming the average customer uses 1,000 gallons of water less each month, the proposed rate increase is now $2.62.

Austin Resource Recovery plans to increase rates $1.85 a month. The Clean Community Fee will go up $0.75 per household per month. The Transportation User Fee will increase $0.45 per month, and the Drainage User Fee will increase $0.60 per month.

The utility asking for the highest increase is Austin Energy. It wants $4.67 more each month to pay for 'uncontrollable costs.' Those costs are: The cost of fuel and the amount ERCOT [Electric Reliability Council of Texas] charges for power supply. That's a 3.4 percent increase over the current rate.

Mayor Lee Leffingwell said that's too much of a increase. During the last budget session, the City Council decided to cap the utility's increase rate to 2 percent.

"Here we are in the first budget cycle, after we adopted that policy, wanting to violate the policy. We could have at least let a couple of years to go by. It may be unavoidable, and that's what I said. I just want to make sure that we cover all the bases and look for all the possibilities of avoiding doing that," Leffingwell said.

The proposed budget also gives a 3.5 percent salary increase to city staff, and a 1 percent increase to all sworn personnel.

It takes 36 firefighter positions, previously funded through a grant, and makes the firefighter positions permanent. It also addresses the staff needs at the 911 call center. Despite a growing population, there has not been a net increase in the number of dispatchers in a decade. The proposed budget adds 21 employees. The proposed budget also increases the Austin Police Department with 59 new police officers by April.

Police Chief Art Acevedo told the City Council he actually needs 102 more officers, but he will make do with less.

"We did a needs assessment throughout the city in terms of what the work load is - in terms of calls, crimes, things that are going on - Special events are also looked at. [We need to assess] what we would be able to use these positions for," said Acevedo.

The City Council will have several workshops and public hearings over the next month before voting on the budget in September.

The budget goes into effect in Oct. 1, 2014.

Go here to read the full budget presentation.


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