Travis County budget makes concessions and cuts to achieve balance

After months of rework triggered by the financial ramifications of the pandemic, the Commissioners Court held its first public hearing associated with the 2021 Travis County budget on Aug. 18. As they went through the 120-page, $1.28 billion budget proposal, Planning and Budget Office staff outlined the cuts to programs and increases in emergency funding that will define the upcoming fiscal year.

Two major changes are the freezing of employee salaries and an increase in property taxes.

While county hiring and salaries have been frozen, the county’s property tax rate will not be. Travis Gatlin, the county’s budget director, told the commissioners that staffers are proposing a tax rate of 37.4359 cents per $100 of property valuation. For homeowners, this means the average annual taxes on Travis County properties will increase by 3.62 percent, or $46.52. Gatlin called it a “very minimal change to the tax rate.”

He clarified that these estimations are based on an anticipated increase in appraisal values across the county for next year.

At a previous discussion on the preliminary budget, Gatlin explained that Planning and Budget staff were mindful of the effects a larger tax rate increase can have on county residents. Due to the disaster declarations issued at a state and national level, local governments may increase the tax rate up to 8 percent rather than adhering to the 3.5 percent cap that the state Legislature enacted last summer.

At Tuesday’s meeting, Gatlin said part of the reason taxes can be held at the proposed levels and fund over a billion dollars in operating budget is due to this year’s savings. During Fiscal Year 2020, the county held back $35 million in cash in anticipation of future needs that may include expenditure or revenue challenges due to Covid-19. These savings allow Travis County to begin its new budget year with a cushion of $221 million in the bank – a 29 percent increase over the cash the county had at the beginning of this year. Staffers are forecasting taxes to contribute an additional $18.7 million.

Even with a larger cash cushion to begin the year, the county is still budgeting to increase its emergency reserve to $17 million. Jessica Rio, the county executive for the Planning and Budget Office, said this increase over last year’s $8.5 million reserve is a one-time funding decision due to the ongoing pandemic.

The county is also looking to reduce excess and save money where it is able. In the proposed General Fund, Gatlin explained $8.3 million is shaved off of expenses by reducing jail populations in the county, limiting travel and training for employees, reducing the number of overall employees by 50, and slimming down utility, supplies and fuel costs.

At the same time, the proposed budget is built on the assumption that retirement benefits and salaries for county employees will not increase from last year.

Resident Frank Netseher called in to the meeting to express his view that freezing salaries amid a pandemic has the ability to harm workers.

Carol Guthrie, the business manager of AFSCME, the union representing local area government employees, echoed this opinion, saying a raise this year “would mean so much more than any other years.” She said, “I hope that you will prioritize your workers and make them a priority so they can at least get something.”

The Commissioners Court took no action at the meeting other than to close the public hearing. On Sept. 3 and 4, commissioners will go through the budget markup process and make adjustments to projects and line items. There will be another public hearing on the 2021 tax rate on Sept. 15 and a final hearing on the proposed budget on Sept. 29, before commissioners vote to adopt the budget the same day.

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