Residents in several of Texas' largest cities could feel their local governments' budget woes hit hard in their pockets. Austin, San Antonio, Fort Worth and Dallas face significant deficits and are considering different combinations of tax increases, higher fees and service cuts to balance their books.
The budget holes range from $51 million in Dallas to $158 million in San Antonio over the next two years.
The impact will not be the same in all cities. While some homeowners could pay hundreds of extra dollars a year, others would even see a small tax reduction, albeit offset by higher municipal rates.
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Austin: More than $400 extra between taxes and fees
Austin is where the impact for the average homeowner appears clearest. The city raised its property tax rate to the maximum allowed by state law without calling a vote. For the average homeowner, that's about an extra $195 a year, equivalent to a 7.4% increase in the city portion of the tax.
But that will not be the only increase. By adding new city fees, the typical annual bill a homeowner pays the city will grow by more than $400, according to the budget.
The goal is to absorb rising costs and avoid a structural deficit that authorities had projected at more than $122 million by the beginning of the next decade.
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San Antonio studies raising the property tax for the first time in decades
San Antonio faces an estimated $158 million shortfall over the next two years and is considering raising its property tax rate for the first time in more than three decades.
If the proposal comes to fruition, the average homeowner would pay approximately $2.95 more per month, about $35.40 more per year, explained City Manager Erik Walsh. At the same time, the city is looking at about $90 million in spending cuts.
The budget crisis also opened a debate over another multibillion-dollar project: Mayor Gina Ortiz Jones wants voters to decide whether the city should allocate roughly $489 million in public funds for a new San Antonio Spurs arena.
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Fort Worth would raise rates, but some homeowners would pay less
Fort Worth's situation is more particular. The city faces a $94.4 million deficit and its recommended budget proposes raising the property tax rate from $0.6700 to $0.7020 per $100 of assessed value.
Despite the price increase, the decline in the value of many properties may result in the usual buyer having to pay about$ 17 less in municipal taxes annually. When adding increases in costs like water and wastes series, those benefits are likely to disappear.
The town proposes phasing out 51 unfilled positions, freezing another 121, and making cuts to certain programs in the budget.
Authorities maintain that increasing the rate would avoid even more severe cuts, such as possible closures of libraries and community centers.
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Dallas: fewer taxes, but also fewer services
Dallas took a different path. The city faces a budget shortfall of about $51 million, but officials are considering a small tax cut that could save the average homeowner about $61 a year.
The problem is that the adjustment would be accompanied by cuts. Among the planned measures are more than 100 layoffs, reduction of hours in libraries and adjustments in programs linked to parks, housing and community services.
Less common proposals to raise or save money also emerged. Mayor Eric Johnson proposed, for example, charging more expensive tickets to those who do not live in Dallas to enter the Dallas Zoo and the Dallas Arboretum, in addition to renting spaces inside libraries to coffee shops.
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Why Big Texas Cities Have Money Problems
There is no single cause behind the deficits. Cities are receiving less sales tax revenue amid a slower economy, while costs related to staffing, public health, safety and other municipal services rise.
Property value growth also slowed. In San Antonio and Fort Worth, even, assessments have decreased, reducing one of the main sources of municipal revenue.
Added to this are restrictions imposed by Texas on how much local governments can increase property tax collections without asking voters for permission.
State law generally limits the annual increase in certain property tax revenues to 3.5% without an election, a rule that local officials point to as another factor that reduces their room to cover rising costs.
