Austin City Manager plans to use budget to invest in the community

AUSTIN, Texas - Austin City Manager Spencer Cronk proposed budget for the fiscal year 2021-2022 would maintain high-quality services and invest in critical infrastructure while utilizing the smallest increase in tax and fees in the past five years, says the city.

Cronk presented his recommendations to the Austin City Council on July 9 at Community First! Village Unity Hall in East Austin.

He says while this was "a time of unprecedented challenge in our community, across our country, and around the world," the city was able to propose a budget that:

• Continues to deliver core services and programs at current levels
• Implements critical reforms that residents and Council have prioritized
• Ensures minimal year-over-year impact on Austinites with tax and fee increases kept below 1% for the typical tax and rate payer
• Achieves the Council's policy of keeping the equivalent of 14% of annual General Fund requirements in reserve

"The good news is that, economically, Austin, Texas has come through the many challenges of the past year in as good, or better shape, than any big city in America," said Cronk. "Our local economy is fundamentally strong and performed unexpectedly well during the COVID pandemic, with more positive impacts for our budget than we anticipated even a few months ago."

• Proposed Budget – Snapshot
• Proposed Budget – Taxpayer Impact Assessment
• Proposed Budget – Fostering a Resilient City
• Proposed Budget - Full Document
• Proposed Budget – City Manager's Message

The proposed budget is based on a combined tax and fee increase of only 0.85% for the typical Austin tax and rate payer – equivalent to just over $3 per month.

The city manager said staff had worked hard to keep the combined tax and fee increase below 1% because, despite the relatively good economic news overall, many Austinites still found themselves in financial difficulty as a result of the pandemic. He acknowledged recent Council actions to increase the homestead exemption to 20% and to increase the exemption for seniors and disabled residents, which made "a huge difference" to Austinites under pressure.

He praised the many years of commitment – on the part of both Council and staff – to responsible money management, which enabled the city to enter the pandemic in a strong financial position with a healthy level of reserves.

One of the largest amounts is going to public safety, after Gov. Greg Abbott signed a bill that would financially penalize cities if they cut their police budgets, which Austin did last year.

This year's proposal meets the threshold necessary to avoid that by reinstating certain departments back into APD's budget, including the forensic lab and the 911 call center.

"HB 1900 hasn’t undone our Reimagining Public Safety, family violence, gun violence prevention, but unfortunately it is hurting our ability to have independent forensic evidence analysis in our city which is really a shame," Council member Greg Casar said.

It also funds APD's cadet classes going forward. "We’re excited about all the great opportunities that this budget has in it and excited about the cadet class," says Corby Jastrow, president of the Austin Greater Crime Commission.

Jastrow says that the commission will continue to be a part of conversations with Council going forward. "As we dive into the budget we’re going to look into the details to see how it’s all spread out within the public safety numbers, but overall very positive," he said.

Laying out the highlights of his proposals for city tax and spending for the fiscal year beginning October 1, Cronk announced that this year’s proposed budget is based on total expenditures of $4.5 billion – including $1.2 billion for the General Fund. The Capital Budget includes $1.3 billion in planned spending.

During his presentation, which was broadcast live and available to view again, Cronk identified several priorities:

• Fostering a resilient city by prioritizing critical investments in programs that respond to the challenges of climate change, address ongoing systemic stressors, and strengthen the City’s foundational infrastructure
• Investing tens of millions of City dollars to address our shared commitment to end chronic homelessness in Austin – on top of the Council’s substantial allocation of federal funds.
• Continuing to reimagine public safety to ensure policing in Austin reflects the community’s core values.

Budget Highlights:

• $79.0 million in voter-approved planned spending to reach key affordable housing goals.
• $65.2 million in continued funding for the City’s response to the homelessness crisis, with specific funding allocated for preventing homelessness, crisis response, housing stabilization, and public space management.
• $29.1 million to maintain and advance progress on Reimagining Public Safety.
• $27.7 million to construct new sidewalks and improve existing sidewalks citywide.
• $8.5 million in planned capital spending on the City’s Safe Routes to School program.
• $6.2 million to fund the 144th class and future classes of the reimagined Austin Police Department Training Academy.

Impact on Taxpayers:

• The proposed property tax rate is 3.5% above the projected ‘no-new-revenue operations and maintenance tax rate’. As a result of property tax exemptions approved recently by city council, a typical homeowner can expect to see a reduction of about $9 in the City’s portion of their annual property tax bill.
• When combining tax, rates and fees, a typical tax and rate payer would pay an additional 0.85%, equivalent to $37.98 per year or $3.17 per month – the lowest increase since 2015-2016. This includes no change to Austin Energy and Austin Water rates and increases to the Transportation User Fees and Austin Resource Recovery charges.

The coming weeks will provide time for community input and budget work sessions. City Council will have the opportunity to review and initiate amendments to the proposed budget before final adoption, which is scheduled for August 11. To learn more about the city’s budget development process, and get involved, go to AustinTexas.Gov/Budget.

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