One of the constitutional responsibilities of the city council is to annually set the maximum tax rate. Each year, the Austin City Council must set the maximum tax rate before they pass an annual budget. Texas state law says that the rate can not be higher than 8% above the previous year. This is called the “rollback rate.”
According to state law, if a municipality wishes to go over 8%, the proposed tax rate must go to the voters for a “rollback election.” The City of Austin has never had a rollback election, but has frequently adopted an 8% max tax rate.
At the August 9 City Council meeting, the Austin City Council adopted a maximum tax rate of 6%. Council Member Flannigan, firm on keeping that rate as low as possible, expressed support for the manager’s budget proposal of 4.9%. Unfortunately, this was not the will of the Council. However, CM Flannigan joined the rest of the Council on a unanimous vote to support a lower maximum tax rate than previous years.
Public hearings before the City Council will be held on August 22 at 1pm and August 30 at 4pm, where anyone can come and speak to the tax rate. CM Flannigan will also be reviewing the city budget at the Northwest Austin Coalition meeting on August 27th, 6:30pm at the Spicewood Springs Library. If you have an opinion to share, please come down to City Hall or join us at the library.
Council Member Jimmy Flannigan
This statement was posted on the Council Message Board on Friday, August 10, 9:56am
This week we set a maximum proposed tax rate for FY 2019 that is 6% above the effective tax rate. While I continue to support the Manager’s budgeted increase of 4.9% reached as a result of our year long strategic planning process, I anticipate our ongoing budget conversations will include contemplating the full 6% increase.
Given a possible proposed tax increase of 6%, the city has the potential to collect an additional $5 million of taxpayer dollars. I know that many of us will hear from great organizations and programs over the next month that do good work and deserve our support. It happens every year and we end up earmarking millions of dollars in projects that have an unclear impact on the overall strategic direction we have agreed upon as a Council. Many of us have lamented this procedure hoping for a new budget process, and our City Staff has started to deliver on that request.
If we do decide to increase the tax rate beyond the Manager’s budget, I know we all want to treat any additional taxpayer dollars with the same respect and responsibility we asked of staff for the entire budget. That means focusing on our strategic outcomes instead of earmarked projects.
I believe that we must allocate any additional tax dollars to our Government That Works outcome, specifically into the Deferred Maintenance Fund. The focus on the condition and quality of our city-owned property (pools, parks, public facilities, etc.) was one of our top ten strategic indicators. By preventing the further deterioration of our public facilities, we can also reduce the deterioration of the public trust in their beloved community assets, address unsafe conditions for the public and city staff, and lessen the need to issue debt in the future which reduces our overall bonding capacity.
We will all feel the pressure, as we do every year, to pick and choose and make programming decisions through our budget, but I think we should support our own request of staff to budget along our strategic framework. I hope you will join me.
To learn more about the proposed 2019 budget, see the link
Proposed 2018-2019 City of Austin Budget.