The latest projection had been that the city would operate under a $63 million deficit in fiscal year 2016. But Mayor Annise Parker’s proposed $5.1 billion budget is balanced, without cuts to services or tax rate or fee increases.
Parker said the good news is by design.
“We always are very, very conservative on the revenue and we overestimate what we think we’re going to need to spend,” Parker said. “And so we build in a gap when we start having the conversations and then we really try to drive the numbers down.”
Parker said the city is not just leaner but also more efficient, thanks to an increased use of data, new technologies and performance improvement programs.
Council member Stephen Costello, who heads the city’s budget committee, said monthly financial reports showed a continuous increase in property and sales tax revenue, so he fully expected the projected deficit to shrink.
“It’s moving forward that’s really going to be a problem,” he said. “So I’ll be interested to see the five-year forecast that will be provided to us next month by the finance department.”
In the proposed budget, general fund spending increases by $130 million, with more than 90 percent of that going to employees’ compensation, pensions and healthcare.
The voter-imposed revenue cap limits the amount the city can take in from property taxes, so Parker is proposing doubling the property tax exemption for seniors and the disabled.
The budget includes funds to raise police officers’ wages and to implement the first phase of the police department’s body camera program.
More money will also be used for pothole repair.
The new fiscal year starts July 1. The City Council will review the mayor’s budget in the next few weeks and should vote on it by mid-June.