Wednesday morning, City of Austin staff presented a $3.7 billion proposed budget to the City Council for the 2017 fiscal year.
City staff noted Austin will be operating on a tighter budget next fiscal year after going into the budgeting planning with a deficit. The city council set budget priorities in the past year, increased the homestead tax exemption to eight percent and the sales tax revenue coming to the city was less than projected.
"There were a lot of initiatives that our new 10-1 council last year launched that had cost implications for fiscal year 17," said Ed Van Eenoo, Deputy Chief Financial Officer for the City of Austin. "The fact that council approved an increase in the homestead exemption which has a result of lowering our property tax revenue, all that made for it to be a very challenging, more challenging than you would expect, budget process."
The proposed budget suggests a tax rate of 44.11 cents per $100 taxable home valuation. That's slightly lower than the current rate but it highest the city can set without having to call an election.
The proposed budget gives city employees a two percent raise along with an additional $0.29/hour to cover increased healthcare costs. It also adds 52 EMS positions because council voted to take EMTs from a 48-hour work week to a 42-hour work week. The budget funds three new firefighter positions to operate the city's newest fire station and 33 new positions at Austin Police Department. Of those 33 postilions, 12 will be police officers and 21 will be civilian positions to do work that's currently being done by officers. City staff say that will allow those 21 officers to get back to patrolling.
Homeowners can expect to see an increase on their tax bill if the proposed budget is adopted. In addition to higher home values causing the property tax bill to increase, several city utilities plan to increase their rates and fees. City staff say the "typical" homeowner will see a total increase of $12.48 per month.
Council Member Delia Garza and the organization One Voice, comprised of 93 non-profits from the Austin area, called a news conference shortly after the budget presentation to call on council to increase funding for Health and Human Services.
The council voted last year to increase Health and Human Services funding after learning the city spends less than it's peer cities. Garza helped lead that charge.
"To keep in step with that this year, the city needs to add $8.3 million more to it's Health and Human Services budget. But this morning, we learned that the city manager's proposed budget only includes about half of that," said Garza.
She added that half of the money added is going toward staff positions and is not money that will directly be used for programming to help Austin's needy.
City Manager Marc Ott said the budget presented is balanced and reflects what the city can do less money coming in.
"As the City Manager, I recognize that there's no way to satisfy all of those forces, so we're going to have to find the compromise," Ott said.
Wednesday's workshop was just the first step in a months-long budget process. Each department will outline it's budget and the council will likely make changes before the final budget is approved in September.
You can find more information on the 2016-2017 proposed budget here.