Houston city staff will see pay raises, money will go toward sidewalk repairs and residents won’t have to maintain their own drainage ditches anymore. All are part of the $6.2 billion budget that passed through Houston City Council with just two no votes Wednesday.
The council voted, 15-2, to approve Mayor Sylvester Turner’s final spending plan, which features the largest net savings in decades. The budget includes previously announced pay raises for all city employees, a drastic increase in tax dollars for Houston’s streets and drainage program, and a plan to revive a long-discarded program for staff to proactively clean and maintain open ditches across neighborhoods.
At-Large councilmembers Mike Knox and Michael Kubosh voted against the budget. Knox, who has consistently voted no to the past seven budget proposals, said there needs to be a larger reform to ensure Houston’s finances are structurally sound. Kubosh voiced concerns about the uncertain impact of state bills on the city’s financial position.
Turner, on the other hand, said this is the strongest budget his administration has adopted in his eight-year tenure. The city’s savings are set to rise to $405 million, surpassing the legally required level by approximately $220 million. The mayor said the high fund balance will set a strong foundation for the next administration after he leaves office early next year.
“Any mayor that comes in has got to deal with the challenges that come before you. For me, I’ve had to deal with unfunded pension liabilities that had not been addressed in 20-something years … and a $160 million budget deficit,” Turner said. “There are a lot of good things in this budget. It not only factors in fiscal year ’24, but it also provides an additional cushion for the next mayor and City Council as they deal with fiscal year ’25.”
Overall, the city’s $3.3 billion taxpayer-funded general fund, which covers core services, will see a 7.7 percent increase from the previous budget. Most of the additional spending will go toward already announced pay hikes for city workers — 6 percent for firefighters as a part of the three-year, 18 percent increase and 3 percent for police officers and municipal workers. In line with previous years, police, at $1 billion, and fire, at $593 million, make up about half the operating budget.
The new budget is set to draw another $160 million from the American Rescue Plan Act, a funding source that the city has relied heavily for the past three years to avoid what Turner said would be “significant” service cuts and layoffs. As federal dollars are set to dry up, officials have forecast deficits between $114 million and $268 million during the next mayor’s first term.
In an op-ed this week, City Controller Chris Brown expressed concern about Houston’s practice of using nonrecurring federal funds to fill its structural deficit, equating it to a homeowner selling furniture to pay the mortgage. He further cautioned that the recent increase in sales tax revenue may not last, as inflation could reduce residents’ discretionary spending.
“No one administration or City Council is to blame for these challenges, but they do require our attention,” Brown said. “We must prepare for the fiscal cliff looming on the horizon.”
Turner said many of Brown’s previous forecasts have not come to pass and tackling future financial hurdles is a task for the next mayor.
“There are some issues that are on the horizon and whoever’s going to be coming forth will have to deal with them, but if you’re a good manager with a good team, you ought to be able to address them,” Turner said.
See here for the background. We’ll be hearing from the avalanche of Mayoral candidates what they think about the city’s budget situation soon enough, since it will be theirs to deal with beginning next year. I’m a big fan of fixing and upgrading sidewalks, and of maintaining drainage ditches, so those things look good to me in this budget. We need to attack the 2004 revenue cap, we need to implement a trash fee to ensure proper and stable solid waste management services, and we need to work on electing a better state government that sees its mission as helping cities thrive rather than try to strangle them. I very much hope that in eight years’ time we’ll have made some real progress on those things.