This year’s legislative session in Texas could turn out to be a costly one for the state’s major cities. One of the bills state lawmakers passed, SB 2, will require cities, counties and other taxing units to obtain voter approval before levying a property tax increase greater than 3.5 percent. Another enactment (SB 1152) prohibits cities from charging telecom companies right-of-way fees. And a third (HB 1631) bans the use of red-light cameras.
All of the state’s big cities won’t be impacted by all three laws. Houston and San Antonio don’t use red-light cameras. But it appears all of those cities will likely take fiscal hits of some kind, a few of which could be sizeable. For instance, the ban on right-of-way fees is expected to cost Houston between $17 million and $27 million a year. And Austin is projecting that the property tax reform will cause a shortfall of $52.6 million in its budget by the 2023-24 fiscal year.
“The 3.5 percent cap will make it more difﬁcult for the city to fund the priorities of the Austin community,” said Ed Van Eenoo, the city’s deputy chief financial officer. “It will make it harder for us to hire additional police, fire and other personnel as the city continues to grow, and tougher to absorb annual cost increases in wages, rents and insurance premiums.” (TEXAS TRIBUNE [AUSTIN], LEXISNEXIS STATE NET)