The Austin City Council OK’d a $3.3 billion budget Tuesday and, for the first time in five years, cut the property tax rate.
The rate will drop from 50.29 cents per $100 of property value to 50.27 cents, but most homeowners will still pay more in city taxes next year because property values are rising.
The owner of a median-value home of $185,133 will pay $931 in city taxes next year — about $34 more than this year.
The lower rate — a unanimous decision — was a victory for Mayor Lee Leffingwell, who pushed for a rate at or below this year’s rate, saying Austin’s economy is booming and the city shouldn’t have to raise taxes in prosperous times.
City Manager Marc Ott in August had proposed increasing the tax rate to 51.14 cents, which would have increased the typical homeowner’s bill by about $50.
Other council members spent the past month digging into the details of Ott’s plan, questioning whether new jobs and programs were truly needed.
Leffingwell said just before the final vote Tuesday that he was happy with the outcome and that in the eight years he’s served on the City Council, “I’ve never seen this level of scrutiny put to the budget. I’m proud of the staff for the work they’ve done and of council members for coming together and addressing this budget in a way that enables us to reduce the tax rate.”
Under the new budget, which will take effect Oct. 1, the typical Austin household will pay $6.17 more per month for electricity and water.
Monday and Tuesday featured long sessions of horse trading at City Hall, as council members cut some spending from Ott’s proposal and added money for items they care about, including better upkeep of city parks, pools and trees; renovations to Austin’s homeless shelter; more youth librarians; after-school programs; and wildfire prevention efforts.
The council had an extra $13 million or so to work with, thanks partly to higher-than-expected revenue from construction fees and sales taxes. They used about $7 million to lower Ott’s proposed tax rate, then opted to spend most of the rest on items that were at risk of having little or no money.
Leffingwell voted against most of those additions, saying most weren’t critical needs.
The council cut about $1 million in police overtime that had been set aside for officers to patrol three hike-and-bike trails overnight. Leffingwell didn’t support that cut, saying the police department will end up pulling officers from other parts of town to patrol the trails and continue carrying out a policy the council passed earlier this year to allow bicyclists on the trails overnight.
Other council members said the officers aren’t needed because they’ve only been encountering an average of 10 cyclists per night on the trails.
To save money, the council declined to add a handful of the jobs that Ott had proposed, including nine people in the Code Compliance Department. They also asked most city departments to hold off on filling some vacant positions; department directors will have leeway to decide when and which jobs to fill.
The new budget will add 395 city jobs. They include 47 police officers, 26 inspectors and planning staffers to review new development projects, and 20 parks employees to maintain five city-owned cemeteries, replacing a contractor that used to do that work.
Police and non-public-safety employees will receive 1.5 percent pay raises. An additional $750 will be added to their base salaries starting this spring, halfway through the city’s fiscal year.
Paramedics and firefighters haven’t finished negotiating contracts with the city that will dictate their pay.
Basics of the 2013-14 budget
• Total budget: $3.3 billion, up from $3.1 billion this year.
• Budget for the general fund, which pays for most city services, including parks, libraries and police: $799.8 million, up from $755.2 million this year.
• Property tax rate: 50.27 cents per $100 of property value, down from 50.29 cents this year.
• City tax bill for a median-value home of $185,133: $931, up from $897 this year.
• Electricity and water bills: About $189 per month for the typical household, up from $183 per month.
• Pay raises: 1.5% for police and non-public-safety employees; contract talks aren’t completed with firefighters and paramedics.
• Jobs to be added: 395