Budget proposal calls for 6 percent tax increase
Austin City Council members chose on Monday to accept the city's proposed budget for the upcoming year, which contains few if any spending increases and calls for a 6 percent tax levy increase.
Half of the tax levy increase is expected by city officials to be absorbed by growth and a shift in property values.
The council plans to talk about its priorities at its next regular meeting in two weeks.
Under the present budget, a home in Austin valued at $120,000 would see an additional $20 on the city portion of its tax statement and a home valued at $268,000 would see a $60 increase, according to Tom Dankert, finance director for the city.
Dankert reminded the council that it has until Sept. 15 to decide the levy for the upcoming year.
He said the proposed budget for 2011 is the same budget the city currently has, except for an increase in capital outlay — payments to maintain the city's assets — which were increased because of anticipated state aid. Dankert and other city officials mentioned a back-up plan, which would involve cutting away projects and spending in the event the city loses state aid.
Council member Marian Clennon asked if there were a way the city could wean itself from Local Government Aid, the state program that accounts for a large portion of Austin's budget. Dankert replied that the city could either significantly cut the budget or find a way to increase revenues, including raising the tax levy.
Council member John P. Martin said the council should "think about the worst-case scenario" and how it could cover the city's budget in case it loses some or all of its anticipated state aid. Austin Mayor Tom Stiehm said the city has fund balances that will last a year and would have to raise taxes after those are depleted.
Appropriations, grant priorities decisions coming
Council members heard appropriations requests from Austin's Human Rights Commission and KSMQ television. The Human Rights Commission is asking the city for $3,500. KSMQ is asking for $12,500. Neither group is requesting an increase over its current allocation.
The council also reviewed a list of 12 Hormel Foundation grant requests but did not prioritize them.
Council members did, however, take turns giving each request their own ranking. Council members were asked to rank the requests from 1 to 12 - 12 being the highest priority and 1 being the lowest - by writing their rankings in on a marker board in the council meeting room, which Dankert tallied.