Mayor Sylvester Turner has unveiled his answer to the $160-million question of how to close the shortfall in Houston’s city budget, but his solution comes with a dire warning about next year.
Among his plans: Tap the TIRZ money, funds amassed by special taxing districts that are allowed to keep and spend some of their own neighborhoods’ property tax revenues.
Turner plans to take $19.6-million from the TIRZ’s, a financial maneuver that dodges the restrictions imposed by Houston’s revenue cap.
“I can’t print money,” Turner said. “It’s not falling from the sky. And I think that’s what people have to understand. You cannot assume that everything is going to remain the same when you’re facing a $160-million shortfall.”
The new mayor’s budget-balancing act relies on a laundry list of line items, like refinancing the city’s debt to save $31.8-million and cutting city department budgets to save $25.8-million. And although it calls for eliminating about 90 jobs, the mayor said the consequences could have been much worse.
Without the money generated by a series of one-time, non-recurring events – such as the sale of an old office building owned by the city – Turner said his budget would have called for laying off 1,235 employees.
Unless employee unions compromise on solving the city’s growing pension problems, Turner warned, the city will face that level of layoffs in next year’s budget.
“Everybody is saying ‘Ouch!’ -- police officers, firefighters, municipal workers saying ‘Ouch!’” Turner said. “But that’s a part of it. And unless everybody participates together in this shared sacrifice then we’re not going to reach a resolution that’s going to be beneficial for the people in the city of Houston. Those are the realities.”
Taking money from the TIRZ’s – an acronym for “tax increment reinvestment zones” – comes as no surprise from a mayor whose budget options seemed limited. Houston has more than two dozen TIRZ’s spending their property tax money on civic improvements like new lighting and infrastructure improvements around downtown and the Galleria area.
But they’ve also generated complaints from some city leaders who argue that TIRZ’s benefit wealthier areas of Houston at the expense of the rest of the city. Nonetheless, TIRZ’s have been able to invest in projects the city government can’t because of the restrictions imposed by Houston’s revenue cap.
The budget calls for 30 to 40 layoffs, most of which the Turner administration hopes to accomplish through attrition. Another 54 vacant jobs will be eliminated.
The mayor’s budget calls for an additional police cadet class to help ease what HPD officials have long complained is a shortage of manpower. Although the police academy has the capacity to train seven classes a year, it will train five under the mayor’s budget.