Austin will send about $4 million less to its savings account next fiscal year. That money will instead fund several one-time initiatives that address child care, public safety and homelessness.
The change is reflected in the $5.9 billion budget the Austin City Council passed Wednesday for the 2024-2025 fiscal year. The budget includes funding for several other items, including additional staff for the animal center and parks departments, city staff pay raises and about $50 million for land acquisition.
It's the largest budget in the city’s history.
It comes at a price to Austin residents. The city adopted a property tax rate of 0.4776 cents per $100 of taxable value, which would mean a roughly $200 annual increase for the average homeowner. That does not include an increase to several fees for water, trash and electricity; throw in another $160 for those.
Council Member Ryan Alter helped lead several of the changes this year.
“This budget includes historic investments in much-needed community services, including for families experiencing homelessness, those undergoing mental health crises, and our public safety professionals,” he said. “In this budget, we are making our communities safer, cleaner, healthier, and simply more livable.”
Council Member Vanessa Fuentes agreed these are worthwhile investments.
“These $4 million we are talking about investing in is a cost of living increase for predominantly women and women of color who are working in the early childhood sector,” she said. “We are talking about increasing our investments in homelessness prevention, we’re talking about funding families experiencing homelessness, we're talking about funding harm reduction and we are also investing in our fire department and our EMS department.”
But some council members and Mayor Kirk Watson were against not putting the money in savings. They said that not only violated the city’s policy of putting at least 17% of its budget into its savings account, but also meant less money to use in an emergency.
Council Member Alison Alter said the investments are all worthwhile, but it's a “slippery slope.”
“I have no problem with the things folks want to invest in here. These are all worthy programs. I am concerned we have a lot of things ahead of us. We have an end to ARPA coming," she said, referring to the end of federal pandemic relief, "so we have all sorts of programs we funded that will no longer have funding.”
Council Member Paige Ellis said the money has also come in handy during recent natural disasters and that the city can’t rely on funding from FEMA.
Wednesday’s adoption marks the end of several weeks of debate among council members about which programs to fund. The city had been working with a tight budget, which city officials tied to flat sales tax revenue and changes to the property tax rules that cap how much a city can increase the rate.
T.C. Broadnax, who became city manager in June, said he learned a lot about Austin and what the city's needs are. He said he would continue to find ways to meet the needs of the community.
“I am excited about this year’s budget,” he said. “There are a few things in there for the community as well as staff for the people who do the work. We do have some challenges ahead of us but there is always a way through difficult times.”
The new fiscal year starts Oct. 1.
