Regarding the Tax Swap

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Regarding the Tax Swap

Postby Steve Adler » Fri Aug 25, 2017 12:01 pm

Colleagues:

When we gather to talk budgets and taxes, one of our biggest challenges is obvious to nearly everyone. The State of Texas has a broken school finance system. The consequence is that, on average, Austin homeowners’ tax bills have shot up more than $1,000 over the last several years, just so the State can take $1 billion a biennium out of Austin, which not only leaves us with increased tax bills, but also without enough money to take care of our own students. And because our City’s quality of life and future prosperity is directly linked with our public schools, the Council is compelled to consider creative ways to help fund the needs of students in our city.

For example, the AISD parent support specialists our City has funded the past several years are not included in the Manager’s proposed budget. We’re asked to figure out where in the City budget to find that funding - even though our community is inequitably being shortchanged by the State, which is failing to fairly compensate Austin for our higher than average proportion of students in poverty and who speak English as a second language. I had hoped that the increased revenue attributed to a tax swap could pay for that program this year.

The ultimate solution is for the State to fix the broken school finance system, but that’s not happening. Until it does, we need to figure out what we can do by exploring any and all creative ideas. The tax swap is one such idea. The message I’m getting from the community is that the tax swap concept is not ready yet, but I’d like to continue the conversation and see if we can get it ready for next year. If the Legislature continues to fail in fixing the school finance system, and more and more cities are going to try to do what they can on their own.

We again find ourselves engaged in yet another budget process with limited funds, and having to choose between really important needs and opportunities. We should not have to choose among such critical needs, and so we must find ways to make our revenue pie bigger. That’s what the tax swap concept is about. This City needs more and better ideas about increasing the size of the pie. The Downtown Puzzle is another idea to make the pie bigger. If we are not creative, innovative, and clever enough, then we will forever be destined to fight with each other over the same small pie. We need a bigger pie, and to get a bigger pie we need more and better ideas. We’re Austin and we can do this.

I want to thank City staff for their hard work on the tax swap concept thus far. It is a much better idea now than just a year ago. Even though there’s still more work that needs to be done and it’s not ready for this budget, I am optimistic that we can solve some of its remaining challenges over time.

We will continue to do the work of the people, and in this context, it means thinking outside the box and coming up with new ideas. We should all be engaged in this effort.
Mayor
Steve Adler
 
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Joined: Fri Jan 16, 2015 3:12 pm

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