Austin's Proposition Q failed: Now what?

AUSTIN (KXAN) -- Austin voters soundly rejected Austin's tax rate election proposition, Proposition Q, Tuesday. It means the city's portion of your property tax bill will go up by roughly $100 more a year instead of $300 more annually (that's for the average Austin homeowner with a house valued at just under $500,000).

The proposition would have brought roughly $110 million a year to the city to pay for services like additional homelessness response, public health and safety programs and parks maintenance.

Voters reject the tax hike: So what happens now?

The budget Austin city council adopted earlier this year will no longer be what the city operates from after Tuesday's vote. The dais will need to come back to the table to essentially redo the later stages of the fiscal year 2025-2026 budget process.

“As the proposed tax rate was not approved by voters, the City of Austin will not proceed with the adopted budget. In accordance with Resolution 20250815-023, the City Manager will prepare a present recommendations to City Council to amend the budget in alignment with the voter-approved tax rate. These recommendations will be presented to City Council in the near future," a city of Austin spokesperson said.

One city council member told KXAN they expect those recommendations as soon as Saturday. Austin Mayor Kirk Watson said Tuesday night that it "should be done soon."

The city council will then go back to debating that proposed budget and will ultimately need to once again take a vote to approve it. As of Wednesday, it's unclear when that conversation will be scheduled to take place.

What exactly will be cut from the budget?

Austin Mayor Kirk Watson was the first to make his intentions clear for how he hopes the budget process will move forward now.

"My belief is that that budget ought to be basically his [City Manager T.C. Broadnax's] base budget and if there's any change that he recommends, it ought to be modest ... and the same is true of the council. If the council wants to do anything with that, it ought to be very modest and it ought to be within the confines of that original base budget," Watson told KXAN Wednesday morning.

A return to the proposed base budget the city manager produced earlier this year would mean less money put toward fleshing out the city's homelessness plan, the elimination of the Austin Fire Department's overtime budget (which could impact firefighter staffing minimums) and less investment in parks maintenance. It could also mean less money for public health, EMS and crime victims.

"I have every hope that the City Manager will bring forward a budget proposal that I feel comfortable supporting without significant changes," Austin City Council Member Krista Laine said. "However, my top priority will always be serving the needs of my constituents, not expediting the political process for myself and my colleagues."

Austin City Council Member Chito Vela's staff said they're hoping to have those budget conversations as soon as possible and Council Member Mike Siegel said he would need to review the city manager's proposed budget and respond then. Council Member Ryan Alter said he was on board with the mayor's plan.

"I agree with the mayor. I think that's a great starting point for us is to look at that budget that goes to the state cap of 3.5% that I think was well prepared by the city manager," Austin City Council Member Marc Duchen said. "The other piece would be to look at what kind of efficiency study or audit we can perform."

Duchen is not the only member of the dais, city leader or community member calling for a study or audit of spending. The city manager sent a memo to city council and the mayor Wednesday that says the city would complete a "Citywide Efficiency Process" next year.

"These efforts are designed to strengthen accountability, improve performance, and ensure that our investments are aligned with City Council's policy priorities, identified best practices and community outcomes," Broadnax wrote in that memo.

KXAN intends to follow both the efficiency and budget processes as they progress.