Mayor Annise Parker has officially proposed not raising taxes this year.
Through her finance director, the mayor is asking the City Council at its Sept. 21 meeting to adopt the existing property tax rate of 0.63875 per $100 taxable value as this year’s rate.
“It’s very hard in these times to not look for more revenue, but it’s also critical that we understand what the private sector’s going through, the taxpayers are going through. Everybody’s doing more with less, and we can’t raise taxes in this period,” Parker said Monday.
As the story notes, this is what Mayor Parker has been saying all along, so this announcement should surprise exactly no one. Property tax revenues overall are at least not declining any more, and sales tax revenues are increasing, so the city should be in an okay position for the next budget. I believe the rate rollbacks of recent years need to be revisited, but I’m okay with putting it off till times are better.
The problem is that it was when times were better that the rates were cut in the first place, because hey, times are good and we don’t need all this revenue. That view turns out to be shortsighted.
The city reduced the tax rate five times during the six years that Parker’s predecessor, Bill White, served as mayor. The cuts reduced the tax rate by nearly 2.5 percent.
The Parker administration estimates that these tax cuts now cost the city about $20 million a year in revenue it would be collecting under the pre-White tax rate.
I did not care for those rate cuts, which each amounted to pocket change for most homeowners but clearly add up for the city, when they were approved. Had we not cut our rates, we’d have been in a stronger position to withstand the downturn. We could have had millions more in the city’s reserves, thus reducing the need for cuts. We could have made bigger payments on our debt service. We could have not issued pension obligation bonds. I’m sure there are plenty of other things we could have done with it, but this is what we chose. Perhaps the next time times are good we’ll keep that in mind.