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Mayor seeks one-year tax hike for Harvey cleanup

This stuff isn’t going to pay for itself, you know.

Mayor Sylvester Turner

Mayor Sylvester Turner will ask City Council to approve an 8.9 percent hike in the city’s tax rate this fall to help Houston recover from Tropical Storm Harvey, in what would be the first tax rate hike from City Hall in more than two decades.

The average Houston homeowner would pay $118 more in property taxes next year under the proposal, which will begin a series of public hearings later this month and reach a formal vote in mid-October.

The tax rate would rise from 58.64 cents per $100 of appraised value – the lowest city tax rate since the late 1980s – to 63.87 cents. That was the rate from 2009 through 2013, when a 13-year-old voter-imposed limit on Houston’s property tax collections first began forcing City Council to cut the rate each year to avoid bringing in more revenue than was allowed.

Turner is able to propose an increase beyond the strictures of the revenue cap – allowing the city to collect an extra $113 million for one year – because Harvey placed Houston under a federal disaster declaration.

“If this is not an emergency, I don’t know what is. What we’re able to recoup from one year, the $113 million, will not even be enough to cover the expenses we will have incurred,” Turner said Monday. “What we don’t get from the feds we’ll have to come up with ourselves. I would be not doing my job if I did not advance it.”

Debris removal could cost more than $200 million and will require Houston to foot 10 percent of the bill without being reimbursed. The city also lost 334 vehicles to floodwaters and saw its municipal courts complex, city hall and its adjacent annex and two wastewater treatment plants knocked offline.

[…]

If adopted, the higher rate would take effect only for homeowners’ January 2018 tax bills. Come the following January, the emergency period would end and the city’s tax rate again would be dictated by the voter-imposed cap, which limits the annual growth of Houston’s property tax revenue to the combined rates of inflation and population growth, or 4.5 percent, whichever is lower.

State Sen. Paul Bettencourt, R-Houston and key revenue cap proponent, said he wants to speak with the mayor to remind him that homeowners’ assessed values are rising, meaning a tax rate hike would amount to a double increase.

Bettencourt refrained from outright criticism of the proposal and praised much of the mayor’s response to the storm. He urged caution on the tax proposal, however.

“The rate is just one half of the equation. The other half is how much the value has gone up,” he said. “This is a delicate public policy issue because we’ve got Houstonians that are literally flooded out of their homes and many people have been affected so they’re not in a position to pay the bill easily, much less if it increases.”

The average Houstonian in a $225,000 home with a standard homestead exemption sends $1,321 to City Hall annually. Turner’s proposal would see that bill rise by $117.86 next year.

Let’s be clear about a couple of things. Thanks to the revenue cap charter amendment, this can only be a one-year increase. The rate will be what we had from 2008 to 2013, so it’s not like this is some unprecedented assessment. The city can’t run a deficit, and it can’t borrow money without getting authorization from the voters. The property tax rate is basically the only mechanism the city has to raise this kind of money. The city will get some federal funds, but it may not have control over their appropriation, and some of those funds as noted in the story are contingent on the city putting up money as well. Lord only knows what the state will pay for, and the county will do its own thing.

The point here is that the city has some big unexpected bills to pay. It has to pay for a lot of overtime for police officers and firefighters who were rescuing people during the floods and who are dealing with aftereffects like traffic control. It has to pay for a lot of overtime to Solid Waste employees who are working to pick up the enormous piles of trash around the city. Your taxes are going up by a couple hundred bucks to pay for this. If you have a problem with that, I don’t know what to tell you, other than I can’t abide that kind of thinking.

Some people will say that we should find costs to cut instead. I will remind you that the vast majority of the city’s expenses are for personnel, and in this particular case the extra unbudgeted expenses are largely for overtime pay. Unless you think all these people should have worked for free, this argument is nonsense. Every time a government entity faces a budget shortfall, I hear people justify cutting programs and services as “shared sacrifice”. In my experience, most of the people who say that aren’t themselves sacrificing much of anything. The difference between those cuts and this rate increase is that this time the bulk of the sacrifice is being felt by a different crowd. If you don’t like it, maybe keep that in mind for the next time.

To address Sen. Bettencourt’s concern, I’m fine with exempting the people who were flooded out from the rate increase. If you filed a FEMA claim, you get to be assessed at the current rate. As for the Council members quoted in the story who say they can’t go along with this, I say no trash gets collected in their neighborhoods until every last piece of Harvey debris has been carted off. There’s a little shared sacrifice for you. The Press has more.

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15 Comments

  1. Flypusher says:

    “If you have a problem with that, I don’t know what to tell you, other than I can’t abide that kind of thinking.”

    I’d tell them that they’ve been mindlessly repeating that “taxes are theft” mantra so long that the critical thinking center of their brains have atrophied. Probably also the people who will flag wave the hardest at the first responders too. Thank yous don’t support a firefighter’s family. Cops need to pay bills too. Pay those people for their hard work.

    Taxes are the dues of citizenship.

  2. Bill Daniels says:

    I have a solution that I think would help this pass. Tie the tax increase to some legal language that prevents any statues from being removed, or any more streets from being renamed…..in perpetuity, and for any reason. Perhaps some kind of temporary moratorium on new bike paths, too.

  3. Flypusher says:

    Any costs associated with statues/street names are a drop in the bucket compared to distasters costs. And a permanent halt vs just a one year only tax? Looks like you are trying to pull a fast one. Technically not my call, but I’d say no deal.

  4. Jason Hochman says:

    Turner is the second highest paid mayor in the country. He should take a pay cut. The storm has been one big triumphant party for him: getting acclaim on TV, throwing out pitches, etc. The rubble in my neighborhood is still sitting there, even trucks from Austin have come around. The trash pickup from Ike was much quicker, and that was an actual hurricane. Harvey was just a typical flood for Houston, such as comes every spring. There is Memorial Day, Tax Day, and I’m sure in the coming spring we’ll see Father’s Day, or Easter, or Mother’s Day as the next flood event. Miami is even recovering from an actual hurricane much faster. I don’t understand the popularity of Turner.

  5. Flypusher says:

    Harvey was far worse than ANY past flood event in Houston- let’s keep that part of it real.

  6. Jason, the amount the city needs for Harvey expenses is in the neighborhood of $100 million. Turner’s salary is what, $300K? He could work for free for the rest of his term, and that’s less than one percent of the need for Harvey funds. Try to be serious, OK?

  7. C.L. says:

    Tie the tax hike into tax medallions somehow.

  8. C.L. says:

    ” Miami is even recovering from an actual hurricane much faster.” ???

    Miami is having to restore electrical service to 6M people as of Monday…. I suspect they’ve put trash pickup on hold for a while.

  9. Jason Hochman says:

    the amount the city needs for Harvey expenses is in the neighborhood of $100 million.

    If that’s the case, increasing the tax on the average homeowner by $118 for one year would generate how much revenue? $10 million? $20 million? You would need to have this tax increase for 5, 10, 20 years to pay off the costs. Let’s not forget that many of the homeowners being asked to pony up the extra money have had their share of expenses, too.

  10. Steve Houston says:

    Jason, it might help the discussion if you read the article since it states, in part: “Turner is able to propose an increase beyond the strictures of the revenue cap – allowing the city to collect an extra $113 million for one year” and while Mayor Turner may be the second highest paid in terms of direct pay, Houston is the 4th largest city, has term limits unlike most other cities, and other cities compensate in other ways better than Houston does. Further, my friends in Miami don’t seem, to agree with your assessment that they are cleaning up faster so if you have a source for that claim, I’d like to see it, and suggesting Harvey was “typical” explains why you probably should never run for office again.

    Otherwise, tying the proposed tax rate increase to too many things is not a good idea. Once we start down that road, every crazy fringe group will demand including everything from tripling firefighter pay, restoring statues of traitors, requiring twice the amount be spent on infrastructure upgrades and so forth. At this point, for the moment at least, you could vote to remove the cap so long as the ONLY thing tied to the proposal was to require the increased amounts were spent on restoration from Harvey and future upgrades. It should be common sense to place expenditures on bike trails and other frills on hold until the city is restored and its finances are completely in order.

    PS: Those calling for flood victims to be exempt from any increases should at least consider that the value of their homes will/should drop significantly next year, if not they should protest the valuations, which will lower their taxes a great deal. As others point out, we shouldn’t be building in areas prone to repeatedly flooding several feet each storm, it’s not going to get better so build the houses on stilts if need be or move onward away from waterways and structures holding great amounts of water.

  11. SD says:

    Most of the overtime bill generated from Police and Fire will get reimbursed by FEMA and won’t cost the city anything. Personnel from both departments had to fill out FEMA overtime forms to be submitted.

  12. Mainstream says:

    My last information shows the Houston mayor’s salary is $236,000.

  13. neither here nor there says:

    Turner is not the second highest, but even if he was the highest paid one has to take into consideration that most cities operate under a city manager system.

    https://www.bizjournals.com/houston/news/2017/01/17/heres-how-much-houstons-sylvester-turner-other.html

    http://www.dallasobserver.com/news/ac-gonzalez-400-000-salary-makes-him-the-highest-paid-city-manager-in-the-country-7147137

    San Francisco has a city manager, http://www.sfgate.com/bayarea/article/20-city-managers-in-state-paid-over-300-000-3173603.php

    As to Texas city managers, https://tcma.org/wp-content/uploads/2016/02/TCMA-Salary-Report-Feb-2016.pdf

    As to the tax increase, the trash must be hauled away, even if we have to pay someone to plant it in front of all of those who don’t care paying for it.

  14. Ross says:

    @Jason, that’s the average increase per house. The average increase for commercial property will be much higher, given their much higher values. The 9% works out to about $100 million when applied to all properties in the City.

  15. […] Ross on Mayor seeks one-year tax hike for Harvey cleanup […]

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