Austin City Manager T.C. Broadnax has proposed a $6.6 billion budget, aiming to balance a $26 million shortfall with a 3.5% property tax increase.

AUSTIN, Texas — Austin City Manager T.C. Broadnax is set to present his proposed $6.6 billion budget for fiscal year 2026-2027 to the Austin City Council on Thursday, outlining how the city plans to balance growing service demands with a projected $26 million budget shortfall.

The proposal calls for a 3.5% increase in property tax revenue — the maximum allowed under Texas law without requiring voter approval — while continuing to invest in public safety, utilities and other essential city services.



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The proposed tax increase is expected to generate about $82 million more in revenue than last year’s budget. Broadnax said about $18 million of that property tax revenue is projected to come from new developments added to tax rolls over the year.

The proposal comes months after Austin voters rejected Proposition Q, a ballot measure that would have allowed the city to exceed the state’s voter-approval tax rate.

“The voters told us, we need to go back to basics,” Austin Mayor Kirk Watson said after the November 2025 election.

For some homeowners, another increase in property taxes remains a concern.

“I’ve been a homeowner since 2018,” South Austin resident Hose Dimas said. “I’ve been paying my property taxes every year, and it just becomes a little bit more difficult each and every year where there’s an increase in property tax.”

Dimas said he supported taking a closer look at how the city plans to spend taxpayer dollars.

“I can’t remember how I voted, but I think initially I was against [Proposition Q] simply because, again, I just needed to see the numbers and where it’s coming from,” he said.

North Austin homeowner Linda Galloway said she has watched Austin’s rapid growth firsthand.

“I’m an elder, but I still notice it’s growing like crazy,” Galloway said.


Public safety and utilities make up the largest share of spending

According to the proposal, about 65% of the city’s budget is dedicated to General Fund operations and citywide utilities. Austin Energy and Austin Water alone account for 43% of the proposed $6.6 billion budget.

Within the General Fund, public safety remains the city’s largest investment. Police, fire and emergency medical services would receive the majority of General Fund dollars, including $504,000 dedicated to Austin Police Department recruiting efforts.

“I personally haven’t had a need for the police presence in my area,” Dimas said. “But just hearing statements about what’s going on around the city, I do believe there’s a need for that.”

Galloway said while she believes public safety is important, she also wants to see continued investment in community services.

“They take up a disproportionate amount of the budget, I think,” Galloway said. “But anything that serves the people, I’m all for it. I’ll pay my share.”

The proposal also aims to address increased demand for city services, including Austin’s parks system.

When asked why parks remain important, Galloway pointed to the role they play for families across the city.

“Because I don’t have a pool in my backyard, and neither do all the little poor kids who get real hot, too,” she said.


What’s next?

Broadnax plans to formally present the proposed budget to the Austin City Council on Thursday. 

Following the presentation, council members will hold several public hearings and budget work sessions throughout July and early August before voting on a final budget in mid-August. If approved, the new budget would take effect Oct. 1.