Property tax rate cut supporters use props to help make their case

Supporters of a big Dallas property tax rate cut used props at Wednesday's Dallas City Council meeting trying to win votes for their plan.

But the majority of council members came down on the side of the smaller property tax rate reduction included in the proposed new budget from Dallas City Manager T.C. Broadnax.

Dallas Mayor Eric Johnson brought a toy boat from one of his kids to demonstrate what he called the Titanic of city finances, heading for an iceberg.

“This is the property tax situation that we're in in Dallas,” Johnson said.

Suburbs with far more affordable rates will lure away even more residents and new construction, Johnson said.

And larger budget challenges are forecast in the next few years by city officials, so Johnson and his supporters say cuts should start now to reduce future pain.

Councilmember Cara Mendelsohn brought a large box covered with dollar bills to represent the increase she says Dallas residents have already paid with tax bills on higher tax values.

“We're talking a billion-dollar increase in the budget in four years. So, to our Dallas residents and I want to say, thanks a billion,” Mendelsohn said.

She began the tax rate cut discussion with a motion for a .683821 rate per $100 value, far below the .7393 the manager suggested. The current Dallas tax rate is .7458.

Mayor Johnson has been suggesting a ‘no new taxes’ rate of .6813 that would provide the city with no additional revenue in the next year to eliminate the effect of rising property values, but that rate was not on the table for a vote Wednesday.

Councilmember Gay Donnell Willis proposed a .7358 rate which she said would still allow for many of the budget measures the manager recommended but her rate never came up for a vote.

“We can be more conservative but holding flat is not the answer in the face of these rising market costs. It will affect the service we give to our residents,” Willis said.

Police and fire department raises that have already been promised are one additional new expense in the manager’s budget.

The median Dallas homestead for the next year is valued at $344,710, an increase from $320,900 last year.

With that higher value, the manager’s proposed lower tax rate would still increase the median homeowner's tax bill by $64.99 a year, Chief Financial Officer Jack Ireland said.

The Mendelsohn tax rate would reduce bills by $83.62 a year.

“Of these options, only one of them represents turning this ship around and going the other direction,” Johnson said.

But, Ireland said Mendelsohn’s tax rate would also require removing $108 million in spending from the manager’s proposed budget.

Supporters of the manager’s tax rate said Dallas has a new Equity Policy that calls for increased funding to reverse inequities of the past in underserved neighborhoods.

“We committed to serve the historically underserved communities and this tax rate needs to speak to that,” Councilmember Carolyn Arnold said.  “When you cut, we die in historically underserved communities.”

Pleasant Grove Councilmember Jaime Resendez said that additional budget money in recent years has helped make progress on city council priorities.

“We like to tout the fact that we’re one of the safest cities over the last few years. It takes investment. And until we get to the point that southern Dallas is contributing as much to the tax base as northern Dallas is, we need to be very thoughtful about the way we’re making cuts,” Resendez said.

The equity supporters also said city taxes are less than a third of the total property tax bill for owners. School, county and other taxes take the rest of the bill, over which city hall has no control.

Neighborhoods around Dallas are still holding budget town hall meetings for input on city spending.

The final budget vote for the new fiscal year that starts Oct. 1 is set for Sept. 20.

“What I don’t want to do is set an arbitrary ceiling number that gives the discretion to city staff to then represent a budget with cuts that we did not have our fingers on,” Councilman Adam Bazaldua said.

He made a motion to use the manager's recommended tax rate of .7393.  That motion passed with 10 of the 15 council members voting against Mayor Johnson.

The property tax rate can still be reduced if the council agrees to budget cuts by Sept. 20.