Wednesday, November 19, 2025, 10 a.m. (Austin time), Austin City Hall
This special-called Austin City Council meeting addressed amending the FY 2025-26 budget after the failure of Proposition Q (the tax rate election). Staff from the budget office, housing, and other departments answered council questions about the financial forecast, sales tax volatility, the housing trust fund, social service contract cuts, EMS overtime (MCOT), travel budgets, and efficiency/audit initiatives. Council members laid out proposed budget amendments and directions, including the mayor's social service contracting direction, an office budget cut, child advocacy funding for children outside Travis County, emergency veterinary services, bad weather essential employee pay, and others. Public comment and a public hearing in the afternoon featured roughly three dozen speakers urging protection of social services, EMS, and homelessness programs, with several speakers calling for cutting vacant APD positions or reopening the police contract, and a few speakers urging protection of the police budget. No budget votes occurred; the mayor outlined the process for votes at the November 20 regular meeting and possible additional meetings.
0:08 You are watching a meeting of the Austin City Council with Mayor Kirk Watson, Mayor pro, tim Vanessa
0:17 Fuentes, council members Natasha Harper, Madison, José velazquez, cheat Vela Ryan Alter, crystal lane, Mike Siegel, Paige Ellis, zoe
0:40 cadre, mark uchin, city attorney deborah thomas, city clerk erica brady, and city manager tc broad.
1:02 That's great. Well, good morning everybody.
1:05 It is 10 o'clock in the morning on November 19th, 2025, and I will call to order this special called
1:11 meeting of the Austin City Council.
1:14 We have a quorum of the City Council present, and we are meeting at 3 0 1 west second street
1:18 in Austin, texas, in the City Council chambers, which are located in City Hall.
1:23 Um, I'm gonna walk through what we're going to do today and, um, kind of give an outline,
1:30 not just today, but over the next couple of days.
1:33 Uh, what we will do today is we're gonna begin with a staff presentation, uh, on the proposed
1:38 budget. But I see the, the people's eyes got real big.
1:42 What what it is, is if they have anything they want to add from yesterday, if they don't,
1:48 then there's no need for that staff presentation <laugh>, um, it, it's, this is a follow up and
1:53 we had a good long, uh, productive meeting yesterday.
1:56 So we'll have them, uh, say anything they want to say.
2:01 If any members of the council have any questions that if they, they woke up at two o'clock
2:06 in the morning and thought, oh my goodness, I need to write this down so I can ask
2:10 it tomorrow morning. They'll be in a position to do that as well.
2:13 And then what we will do are for those council members that have proposed amendments that they are
2:21 ready to lay out, we will do that.
2:24 Then we will go to public comment.
2:26 Uh, we have people that have signed up to speak on the agenda item, uh, that we have,
2:32 that we have scheduled, uh, which is the presentation of the discussion of the city manager's proposed amended
2:37 budget for fiscal year 20 25, 26.
2:40 At that point, when that's completed, uh, we will recess until three o'clock, and at three o'clock we
2:49 will, uh, conduct a public hearing on the city manager's proposed amended budget, uh, for that fiscal year.
2:55 I wanna point out also that tomorrow, Thursday, the 20th of November, starting at 10 o'clock, the council will be
3:03 taking up items to, to vote on amending the budget and updating the tax rate ordinance since prop
3:10 q was not approved, I want to point out to aaron, anybody within the sound of my voice
3:16 that tomorrow is a regularly scheduled council meeting.
3:19 So we will also be taking up a number of items that are related to, uh, the, the,
3:26 the work of the council and the city.
3:28 Uh, so this will not be as some May be accustomed to, where all we're going to do
3:33 is bring up and talk about the budget.
3:36 Uh, we also have council meetings posted for the 21st, uh, Monday, the 20 fri for Friday, the
3:42 21st, Monday the 24th, and Tuesday the 25th for members of the public.
3:49 I want, again, emphasize that those meetings will only be held the one on Friday, Monday, and Tuesday
3:58 if the council does not get to the needed number of votes in favor of the proposed budget
4:04 amendments beforehand, meaning tomorrow on Thursday, and needs to have those meetings for the budget ordinance to pass
4:11 by the required votes.
4:14 If council gets the needed number of votes before any of those meetings, we will be canceling the
4:21 remaining meetings. Also, I wanna point out again, regarding tomorrow the 20th.
4:27 If council can't get to a vote on the amended budget before the end of the day.
4:33 And keep in mind, uh, we, we will be having other items that we take up as part
4:39 of a regular scheduled meeting, and we will be taking up the budget.
4:44 And there is time for public comment.
4:45 So it is conceivable that by 10 o'clock, uh, in the evening, council is not in a position
4:53 to, to vote. And this council is of, of the policy and practice that we're not going to
4:59 vote after 10 o'clock.
5:01 So what we will do is we will recess tomorrow's meeting and come back on Friday.
5:08 That is not the same as the new meeting on Friday.
5:11 It is the same meeting, so there will not be public comment on Friday if we recess the
5:16 meeting yesterday. Um, so to sum up, uh, if you wanna be guaranteed an opportunity to speak on
5:24 the proposed budget amendments before we vote and you weren't able to sign up today, I encourage you
5:30 to sign up to speak at the council meeting tomorrow and, um, for tomorrow, online speaker registration closes
5:39 at noon today with in-person speaking, closing to, uh, registration closing at nine 15 in the morning tomorrow.
5:49 Okay. So counsel, now what we will do is I'll call on our staff, uh, to see if
5:54 they want to add anything or subtract anything since we're talking budget numbers.
5:59 I thought I would use math terms, um, and, uh, from their presentation yesterday.
6:07 Good morning, Mayor and council, carrie lang, director of budget and organizational excellence.
6:11 Um, we don't have a new presentation, but Council Member Vela asked some questions about the housing trust
6:18 fund, and I wanted to give some insight on, um, the housing trust fund.
6:23 So, um, that fund primarily has three revenue sources.
6:28 Um, the transfer in from the general fund fee in lieu of revenue and interest or other revenue.
6:35 The largest revenue source has historically been the general fund ranging from $9.7 million to fiscal year 25.
6:43 It was $10.8 million transfer.
6:46 The fee in lieu also fluctuates.
6:48 Some it was 8.2 or 8.3 in fiscal year 23, uh, it was reduced down to 7.8 by
6:56 fiscal year 25. And, and the kinds of things that the, um, fund historically has been used for
7:05 include emergency tenant relocation, um, tenant stabilization, homeless shelter.
7:12 I guess in 24 in particular, there was some acquisitions that it was used for homeless shelter and,
7:18 um, acquisition and development that it was used for.
7:21 And then it's been used for the housing voucher program.
7:25 And so those are the major programs that it's been used for.
7:27 The programming for that fund fluctuates a little bit year over year.
7:31 Um, but those are the primary things that it's been used for.
7:35 Vela. Thank you. Uh, and thank you, Mayor.
7:37 Um, the fee in lieu, is that primarily the downtown density bonus?
7:42 Yes. And what about, my, my understanding relating to the conversation yesterday is that, um, the handful of
7:51 public private partnerships where the city is, uh, uh, the revenue that the city gets off those public
7:57 private partnerships, are those included in the fee?
8:00 And l is, is is that, uh, and again, I'm thinking honestly of the properties immediately surrounding us,
8:07 uh, I believe that there was some long-term contract by which there was money.
8:13 That again, that's my understanding.
8:17 I am not sure.
8:18 I'm gonna ask, uh, the director to come in and speak to that.
8:25 Good morning tta dean Austin housing.
8:28 Yes. The answer to your question is yes.
8:30 Uh, there are ordinances that are tied to those dollars so that projects have to occur in the
8:36 particular areas where the resources were, uh, drawn from.
8:40 Uh, so, and do we know what those revenues are, what the numbers are for those revenues?
8:47 Yes, those revenues. Do you have, so, and, and to follow up on that, uh, uh, question.
8:53 So those revenues go into the housing trust fund, but they're limited, their use, the use of those
9:01 funds is limited to kind of the geographic area that generated the revenues?
9:05 That is correct. Alright.
9:07 And, and what are those, uh, uh, projects?
9:09 Just out of, uh, uh, curiosity?
9:11 I have, uh, mandy's on her way.
9:13 Okay. Um, so she can, I don't have the historical information, but she is on her way and
9:17 she'll be able to answer in more detail and, and that's fine.
9:20 We can hold off until, uh, uh, mandy gets here.
9:22 Absolutely. And have that conversation.
9:23 Thank you though, uhhuh.
9:24 Thank you, councilor. Anything else?
9:27 No, sir. Alright, then, um, if counsel has any questions and I'll, I'll turn to the Mayor pro
9:32 tim. Thank you colleagues.
9:35 My first, uh, round of questions I wanted to focus on the financial forecast.
9:39 I don't know if we can pull up the slide from yesterday's presentation on our five year outlook
9:44 as presented by staff.
9:46 I just wanted to kind of take it back for us, uh, to the financial forecast briefing that
9:52 we were given, uh, 18 months ago in April of 2024.
9:56 And I'm gonna hone in on fy 29 as part of my comments here.
10:02 And why fy 29 is because that is what staff is now projecting as, uh, the first fiscal
10:07 year budget that will have us in a projected deficit.
10:13 So in April of last year of 2024, we were told by staff that we should anticipate a
10:18 $59.9 million deficit in fy 29.
10:22 Later that year, in July, staff gave an updated presentation that then presented it as an $11 million deficit.
10:31 In August, it dropped down to $1 million deficit for fy 29.
10:35 And then in October of 2024, the same month in which we approved the police contract, the presented
10:41 deficit increased slightly to 6 million and fy of 2025, about six months after we approved the police contract,
10:50 that projection for fy 29 had us at a $74.5 million deficit for fy 29 in July of that
11:02 year. That started, that kick started our budget conversations for this fiscal year.
11:07 That deficit for fy 29 was projected at 40.3 million.
11:13 And now as presented by staff, it is at a 33 million, I believe on that slide.
11:21 So over the past year and a half, the projected budget deficit has ranged from 60 million to 37.4 million.
11:30 And so I wanted to ask our staff here regarding the financial forecast, you know, how can we
11:37 have confidence in the numbers that you're providing when there's been such a wide range of the deficit,
11:43 how large it can be, again, ranging from 60 million to now 37 million with the out years changing for
11:51 it, you know, we base our decision making as policy makers.
11:55 We base our votes on this financial forecast.
11:58 And so I just, if you can walk us through the projected deficit that we have for fy
12:04 29, what factors have changed, and just talk us through what variables do we need to contextualize as
12:10 to the range of the deficit that you all have provided us in the last year and a
12:15 half? Thank you Mayor Pro Tem.
12:19 Um, you're right, the, there are changes that happen in our forecast, um, as we go through the
12:26 different processes of the budget.
12:28 And when we give the financial forecast in April, it's a very high level, um, review or look
12:34 at what we anticipate our revenue to be.
12:36 Um, and there are so many variables that change with that, whether or not it is the changes
12:40 that we see in sales tax revenue, which is probably the most volatile that we'll see that impacts
12:45 our, our forecast, um, for the general fund.
12:49 And so, um, without having the detailed numbers right in front of me, I think our, our sales
12:54 tax revenue was projected to grow about three point a half or 4%, um, when we were showing
13:00 those, um, increased deficits.
13:02 And then we saw that sales tax along with the rest of the economy kind of flattened or
13:07 go down a little bit.
13:08 And so that impacts what our forecast will look like.
13:11 Um, but each year as we come in and we balance the budget, that kind of resets what
13:17 the forecast does. So when we started out in, um, April of 2024, thinking through what the fiscal
13:23 year is gonna look like, and then as we get more, um, whether it is more property tax,
13:28 because I believe in fiscal year, uh, 24, 25, that's when we saw our record, um, increase in, um,
13:36 new construction. It was at the 5.2, um, million, billion I think that we saw in in new
13:41 construction. Those variables change and have an impact on how the forecast updates over that timeframe.
13:48 Um, we have been really conservative in our recent, uh, budget with our projections for sales tax.
13:56 And we continue to talk about how our expenditures grow compared to that overall revenue growth.
14:01 And so as we see those changes, whether it is new ongoing programs or, um, even, even how
14:08 we are spending our dollars, it impacts whether or not it's the 4% increase to, you know, our
14:14 civilian employees, our health insurance.
14:16 All those changes have a, uh, impact on how our forecast, uh, is updated.
14:22 And as we get numbers throughout the year and throughout our budget process, we make updates to that.
14:28 I'll say that our forecast is a plan, and those plans just like the budget will change.