Is City Council Required to Pass a Budget?

By Urban Reform Staff | May 20, 2019

An interesting conversation with the potential to stall the city’s budget approval process has been rumbling around city council: does city council actually have to pass a budget?

According to Houston Controller Chris Brown and Houston Finance Director Tantri Emo, the answer is “no.”

Doug Smith, activist and Superneighborhood Alliance member,  has attended virtually every public workshop for the proposed 2020 budget. He’s been asking questions and drilling holes into the budget left and right, but one issue he brought up, that many on council didn’t seem aware of, was that they didn’t actually have to approve the proposed budget as is.

It’s been the practice that council members will question department heads during budget workshops, but short of their own budget amendments little changes are made to the overall budget. Despite complaints and frustration, they usually vote in favor of it, as is.

But Smith noted, rather than rubberstamping the mayor’s request, according to the city charter they could reject it and operate under an ordinance that allows them to continue to spend at the current year’s budget levels until they agree on a new budget.  This goes against repeated claims by the administration that council had to pass a budget by July 1.

Since the proposed budget is about 3 percent higher than 2019’s, this means that if they reject the budget and operate under the continuing resolution, they would maintain the same spending levels.

It wouldn’t be a bad idea for council to delay the budget vote, even if just for a week as there have been a few issues with this budget from the start.

Despite what the mayor and administration say, the budget isn’t balanced, it also doesn’t address the massive unfunded retiree healthcare liabilities, and it doesn’t even attempt to implement zero-based budgeting.

Aside from those structural issues, there are process issues that abound.

The proposed budget was only released to council and the public 24 hours before the first budget workshop began. What’s worse is, while every department’s budget is important and deserves time for scrutiny, the first presentations were made just 24 hours after its release were the Finance Department, the Mayor’s Office, and City Council, three of the, arguably, most important and most hard-to-understand departments.

As the workshops proceeded it became readily apparent that many questions weren’t going to be answered publicly. Time and time again during the hearings a question was posed by council and then referred to CityPointe, the city’s internal communications system. Much of the information, which would be beneficial for the public, will only be accessible by council members and staff.

Also, a recently passed telecommunications bill in Austin is threatening to cost the city $25 million in this proposed budget. The administration was monitoring the bill but failed to account for its potential passage in the budget and, well, it passed. This now means there needs to be a reconfiguration and public presentation to address the shortfall.

Lastly, and certainly the biggest issue, is that in the middle of the budget process Proposition B was declared unconstitutional. Because of the passage of Prop B in November, the mayor worked in the $79 million pay increase for fire fighters into his 2020 proposed budget. Now, as the pay raises aren’t happening, there’s an additional $79 million built into this budget and what will happen with that has yet to be addressed.

For all those reasons, and more, it would be wise for council to take a step back and reassess before approving $5.2 billion in spending.

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