Amendment to TRE Policy #3 (Agenda #58)

[Mike Siegel]

Dear colleagues,

Thank you to the Audit & Finance Committee for developing a careful process for how Council should consider and develop any TRE proposal. Our decision on a potential TRE this year will have enormous ramifications for the quality of City services for years to come.

To that end, I would like to offer an amendment to the Resolution relating to TRE policy #3(a), which currently provides that a “TRE should not be used to address base cost drivers but can be proposed to address identified gaps in service and new or expanded services.” (Draft Resolution, lines 38-39.)

My concern is that there's room for disagreement about what qualifies as a base cost driver, and that there may come a time (if it has not come already) when a TRE is in fact necessary to address base cost drivers. I also do not want to create a division between City employees and services by inadvertently pressuring Council or the City Manager to label some expenditures as “base cost drivers” and not others in the event of a large deficit.

As an example, a number of City positions have been negatively impacted by cuts initiated by DOGE and the new federal administration. These positions, largely in the Public Health Department, are grant-funded, and may or may not be considered “base cost drivers.” And yet, many of the workers in these positions have been serving the City for years, if not decades, and provide programs and services that fulfill Austin’s values and core policy objectives. I would not want our TRE policy to penalize these workers, and the programs they fulfill, simply because a new federal administration decided to cut their grant funding.

My proposed amendment would simply remove subsection (a) from Policy #3. https://services.austintexas.gov/edims/ ... ?id=451839

I hope that you will find this to be a helpful amendment. I’d like to send a message that, if we ask voters to support a TRE, this will be for the good of the entire City, and all its programs and services.

With respect,
Mike

[Colleen Pate]

Council Members:

I think Council Member Siegel’s thoughts have merit and look forward to the discussion on Thursday. This is the sort of thing we should discuss as we look to creating a new policy like this. In fact, it creates a focus on what are “base cost drivers” (we don’t want something vague or lost in semantics) and/or why we wouldn’t want them to be the basis for going above the cap if, for some reason, we needed the tax rate to be higher than the cap to achieve specific goals. In any event, there would be a discussion by Council at the time a potential TRE is considered as to whether the base cost drivers were a good reason to go to the voters.

As a reminder, Item 58 is an item that comes from a council committee. So, it is not on the consent agenda by rule, and we will take it up separately.

Thanks.

Kirk

On behalf of Mayor Watson

[Julie Montgomery]

On behalf of CM Ellis:

CM Siegel, thank you for your proposed amendment to the TRE policy. I share your concerns that, particularly due to the Legislature's arbitrary municipal revenue cap, the City will soon face an unavoidable budget deficit due entirely to base cost drivers like employee wages, health insurance, and pension contributions. I agree with Mayor Watson that your amendment has merit and intend to support it tomorrow.

Thanks,
Paige