Kathie Tovo
City Council, District 9
I have been a strong advocate for using our city resources effectively and responsibly, while also working on ambitious proposals to address the root of our property tax problems: the state government.
The city offers many different crucial services, including funding (among other things): emergency responders to keep our residents safe; sidewalks, roads, and trails to keep our residents mobile; parks, pools, and libraries to keep our residents active and engaged; and health services to keep our residents healthy; and social services to support our most vulnerable residents.
Many of these investments also help reduce future costs, putting our city is a better position to continue providing these essential services going forward. For instance, ensuring children have access to healthy food can prevent future health care costs while adequately maintaining our infrastructure can prevent future construction costs. Additionally, as the former Chair and current Vice Chair of the Audit and Finance Committee, I have worked to oversee how the city is managing these services, to ensure we are delivering them efficiently and effectively and taking action to solve problems where they exist.
At the same time, I recognize that many people are concerned about rising property taxes. And while Council and Austin voters have approved certain property tax increases over the years to help maintain our city services, I think it is important to discuss the root of our property tax problems: the state.
Rather than meeting its educational obligations on its own, the state has set up a school financing system that uses Austin taxpayers to fund its other responsibilities to other school districts across Texas. Roughly 70 percent of the increase in property taxes over the last five years has gone to the state, with the remainder split up among the school district, city, county, community college district, and health care district. The state now collects more property taxes from Austin residents than does the city. This is so important that it bears repeating: Austin residents pay more in property taxes to the state (which spends that money outside of Austin) than to the city (which invests that revenue in our parks, pools, libraries, emergency services, social services, and other important programs).
Outside of that major problem, the state also impacts local property taxes in a number of other ways, as well, by preventing cities from adopting progressive taxing policies or making it difficult for cities to access property sales information. Preventing cities from accessing sales data is a particular problem because it makes it more difficult for local government to appraise properties. Commercial properties are the most likely to benefit from this, with more of their share of the tax burden shifted over to residential properties. One expert study – which I led Council to fund – found that commercial properties in Austin had been undervalued an average of 47 percent, largely due to state law making it difficult for the appraisal district to acquire sales data.
Problems like these are why it is crucial that we elect strong local progressives who both share our values and who have the experience needed to move us forward with creative policies. During my time on City Council, I have worked on these issues in a number of creative ways. For instance, I led the effort to have commercial properties pay their fair share of the tax burden by challenging the appraisal district’s undervaluation of commercial properties; this led the appraisal district to improve the way they collect information for commercial appraisals and helped address the discrepancy between residential and commercial property taxes. I also helped lead the effort to consider a “tax swap” with AISD designed to significantly decrease the amount of property taxes that go to the state and thus lower Austin residents’ tax burden. While Council has not yet adopted a full-scale version of this plan, I have succeeded in more targeted efforts to help this situation by defraying school district costs.
I look forward to continuing to work to responsibly manage our city budget, adopt creative ways to fix our broken property tax system, and call on our state legislators to pass reforms that stop unequal taxation of Austin residents.