Mayor John Whitmire
Amid Houston’s strained financial outlook, Mayor John Whitmire unveiled a $6.7 billion budget proposal on Tuesday, announcing he does not intend to raise taxes or significantly cut city services during the fiscal year starting in July.
The proposed budget, the first of Whitmire’s tenure, features a 7% increase from last year’s plan. It includes additional costs from the $1.5 billion firefighters’ settlement and likely pay raises for municipal workers. It does not, however, account for the approximately $100 million fiscal impact from an April court ruling concerning the city’s drainage system.
Whitmire’s administration previously floated the idea of a property tax hike and a garbage fee to close the existing budget gap of around $160 million and help fund the firefighters’ deal. But the mayor said these measures will not be considered in the upcoming year. Instead, the city plans to use the remaining COVID-19 federal funds to close the deficit, which he said he inherited from former Mayor Sylvester Turner’s administration.
Earlier this year, the mayor asked all city departments, except for police and fire, to identify ways to cut their spending by 5%. The resulting plan shows $11.7 million in departmental savings, primarily from eliminating vacant positions, according to Finance Director Melissa Dubowski. She and the mayor said they will continue to seek cost-saving opportunities in the coming days.
“I wasn’t prepared to raise taxes or cut services in the short five months that I’ve been here if we could possibly do it a different way,” Whitmire said during a Tuesday press conference. “I actually said during the campaign we didn’t know the true state of the city finances. And we’re still learning on a daily basis where we can have savings.”
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To find more cost-saving measures to cover these major financial liabilities, Whitmire said the city will undertake a comprehensive review of each department in the coming months. He said he will also continue to work with other government entities – including Harris County, Metro and state agencies – to share the costs of running city services.
“Things are in place to get through 2025 without raising taxes through efficiencies and collaboration,” Whitmire said.
See here for more on that drainage fee ruling and its impact. I understand the choice of not raising the property tax rate or implementing the garbage fee now. It’s a choice most Mayors would have made. By not raising extra revenue now, it will have the effect of putting more of a burden on future budgets. Maybe there are things that will happen between now and the unveiling of next year’s budget that will ease that burden anyway – higher sales tax revenues, for instance. Maybe cooperation with other government entities will be especially fruitful. Maybe the politics of trying to do those things will be more favorable next year than this year. As someone once said, you pay your money and you take your chances. There’s a series of budget workshops scheduled from May 15 to May 28 at which we will learn more details about all this, so stay tuned.