The Austin City Council took its first public look at a proposed $6.6 billion budget Thursday, providing members a chance to signal priorities for the coming weeks.

Some emphasized restoring cuts to social services. Others talked about more security for local parks and cuts to consulting contracts. But one word kept coming up: affordability.

“Sometimes it feels like we’re cultivating two Austins here: one that can just shrug off the tax increase, it’s a rounding error for them, and one that’s going to be disproportionately impacted,” Council Member Marc Duchen said.

The City Council’s deep dive into the budget comes at a time when money is tight because of sluggish growth, state-mandated caps on property taxes and the end of federal COVID money. That slowdown means less money for the kinds of services people want, including police, parks, social services and libraries. Thursday’s meeting launches a focused sprint toward a plan to balance the city’s ideals against proposed cuts, higher taxes and fees. And they have less than a month to do it.

The proposed city budget lays out tax hikes and increased fees for services like trash, water and electricity. Together, those increases would cost the owner of an average-value home of $487,907 could pay nearly $350 more in property taxes and fees next fiscal year.

Though City Council has the option to raise taxes more than 3.5%, that would require voter approval through a tax rate election. In the shadow of last year’s failed tax rate election, council seemed disinclined to push the budget higher than allowed under state law.

The budget calls for a $5.1 million decrease to social service contracts. But the budget also prioritizes what Austinites value, City Manager T.C. Broadnax told the council

“While there are reductions in this budget, that’s not the entire story,” he said. “We also increased investments in key areas, especially those that matter most to our community. We’re also investing in our most valuable resource: our employees.”

Proposed budget increases include:

• $1.2 million in additional funding for parks, maintenance and refurbished pools.
• A $6 million increase in overtime pay for the firefighters
• $7.1 million for 3% employee raises
• $1.1 million in one-time funding for audio-video equipment and improvements to the Austin History Center Campus.

Social service cuts draw early scrutiny

Throughout the six-hour budget work session, multiple council members said they wanted to restore cuts to social services as much as possible. One way, Council Member Mike Siegel suggested, was to cut consultant contracts that might be unnecessary. A recent city audit found the city has spent over $279 million since 2023 on services provided by consultants.

“I’d much rather we cut up $2 million in consulting contracts than any of our social programs,” he said.

City finance staffers will provide more details about social service cuts next week. Council Member Ryan Alter said the council is still waiting to learn which groups are losing money and took a stand against the idea of doing an across-the-board cut for all nonprofits.

“It does require picking some winners and losers, but we have to look really hard at who is delivering their services as expected, and who is not,” he said. “If you’re not meeting your contract obligations, then I think you should expect to see a more significant cut than somebody who is..”

Council Member Krista Lane made a push for more cameras in parks that need them.

“I’m entering this budget process wanting to ensure that there’s sufficient funding for parks cameras and security infrastructure that’s needed, without putting any of it forward to three to five years or bond funding,” she said.

Dozens of Austinites weighed in during public comment, advocating for funding for violence prevention programs, homelessness initiatives,. early childhood education and public safety.

The next budget meeting will be held at 10 a.m. July 22 at City Hall, with adoption of the budget to take place by Aug. 14.

Mayor Pro Tem José “Chito” Vela said cutting the city budget is difficult but making hard choices now will prevent a budget deficit problem like the one Austin ISD is facing, he said.

“I don’t want to put the city in that situation 10 years from now,” he said. “I’d rather make small but difficult decisions on a year-by-year basis than get to a situation where we have a massive budget deficit and a very painful process.”