What happened
Proposition Q, the ballot measure to cement a property tax rate above the city's voter-approval limit, failed in the Nov. 4 election with more than 63% opposition. That result automatically lowers Austin's tax rate to $0.524017 per $100 property valuation—5 cents below the higher tax rate that was on the ballot, but still a nearly 10% increase over last year's $0.4776 rate.
The approach
The tax hike proposed under Proposition Q resulted from City Council adding about $110 million in new spending—largely for homelessness and housing programs, public safety and public health, and parkland maintenance—to the original fiscal year 2025-26 budget proposed by City Manager T.C. Broadnax in July. Austin's final spending plan will now likely resemble that first draft, although changes are possible.
Mayor Kirk Watson said officials should only make limited edits to Broadnax's original outline and avoid relitigating the extensive amendments made during their two-day budget approval in August. Still, officials gave themselves the discretion to adjust all aspects of the budget in case the TRE failed.
A city spokesperson said Broadnax will bring a revised budget for consideration. A timeline wasn't finalized as of press time.
"As the proposed tax rate was not approved by voters, the city of Austin will not proceed with the adopted budget," the spokesperson said in a statement. "[T]he city manager will prepare and 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."
Put in perspective
Leaders with Save Austin Now, the top political group opposing Proposition Q this fall, framed the measure's failure as a win for taxpayers and a check on City Council.
"This is a taxpayer revolt," SAN co-Chair Matt Mackowiak said on election night. "Our City Council and our mayor already have said many times, affordability is a crisis. Well folks, you do not make affordability better by raising taxes.”
Brandon Rottinghaus, a political science professor at the University of Houston, said Austin's TRE was the most notable attempt so far by a major Texas city to boost its funding under 2019's Senate Bill 2, which capped year-over-year tax revenue increases for local governments. Austin's lone previous tax election—specifically to fund the Project Connect transit system—passed with majority support in 2020.
This election's result may also signal wider voter skepticism over government spending, Rottinghaus said, given the difficulty of encouraging residents to increase their own cost of living.
“If you can’t get this passed in a place like Austin, the likelihood of it passing anywhere is very, very low," he said. “There’s certainly demand for more money [under SB 2], and there’s been initiative among municipalities to try to ask voters for more. But with the recognition it’s a serious challenge to get it passed, you may see many of them balk. ... I feel like you’re going to see municipalities asking more but expecting rejection."
Leaders with the Cares Not Cuts Coalition, one of two main campaigns in favor of Proposition Q, said the measure's defeat follows years of attacks on government from the state and federal levels.
"[Gov. Greg] Abbott’s 3.5% revenue cap obviously triggered this whole election, and I think it’s part of his war on cities. It makes this very difficult to raise the revenue we need to secure our future as a city," said Doug Greco, Travis County Democratic Party chair. "It’s disappointing, but we’ll get to the drawing board and fight to make sure that families are protected in these cuts.”
Brydan Summers, president of the public employees' labor group and Cares Not Cuts Coalition member AFSCME Local 1624, also said the result stemmed from attacks on public sector workers and distrust in local policymakers.
AFSCME membership is now concerned about the potential for widespread city layoffs under a budget cut, he said. Summers also questioned whether running two pro-Proposition Q campaigns, one under the coalition and another by the separate Love Austin political group, diluted their messaging.
Also of note
The TRE failure and upcoming budget rewrite prompted calls for closer scrutiny of city spending from both sides of the Proposition Q debate.
At SAN's Nov. 4 victory party, Mackowiak demanded an independent audit of Austin's budget—a project some city critics have demanded for years. Watson also stressed the need for an "evaluation/performance review/audit, whatever it’s called" into Austin's finances and delivery of public services.
"Trust needs to be restored, and we need a systemic evaluation to better balance the cost of services with the need for those services," he said in an election night statement.
Appetite for a city spending audit comes years after Austin residents voted down a ballot measure for a third-party efficiency study into city finances; 2018's Proposition K failed with nearly 58% opposition.
Rottinghaus said local perception of conservative support for the proposition may have caused it to fail seven years ago, but that audits are beneficial for cities to take on.
"Sometimes it’s overlapping spending, sometimes it’s duplicative spending, sometimes it’s just a view to see where money’s really going," he said. "The short answer is yes, having an audit definitely gives a powerful microscope to city spending, which can be revealing and useful in terms of prioritizing spending."
What City Council is saying
Almost all City Council members weighed in with statements on Proposition Q's failure and related impacts for Austin's budget following the election.
Council member Marc Duchen—the only city official to vote against the budget this summer—said the election represents a "wake-up call" and a "referendum on trust" in City Hall. He also repeated a call he made this summer for an in-depth spending review, inspired by a similar study recently conducted by Houston.
"Austinites are struggling with economic uncertainty, high taxes and other challenges in an increasingly expensive community," he said. "It’s time for elected officials to acknowledge those problems instead of making the city less affordable. One way we can do that is by conducting a top-to-bottom efficiency study to address City Hall’s structural deficit and ensure we spend as wisely as possible.”
Among remaining officials who supported the expanded budget this summer, council member Natasha Harper-Madison said she anticipates "difficult conversations" in the near future as officials revise Austin's spending plan.
"Meeting the city’s most pressing needs while making thoughtful, responsible decisions for the good of all Austinites is no easy task. This budget reconciliation process will require collaboration, transparency and careful deliberation—and your attention will be key as we work together," she said.
Mayor Pro Tem Vanessa Fuentes said Proposition Q was put to voters to protect city services, which she cautioned may now be at risk under a smaller budget.
“These cuts will have real and serious consequences—that could mean fewer paramedics on shift, fewer families receiving rental assistance and access to food programs, longer wait times for emergency services, and reductions in park maintenance and public health outreach—all at a time when many in our city need more help, not less," she said.
Council member José Velásquez thanked voters for making their decision and said he'd fight to ensure essential city services are maintained.
"Now it’s the time for me and my colleagues to carefully revisit the budget and find solutions that our community can get behind. Together, we can create a better Austin," he said.
Council member Chito Vela said he'd hoped to see a different outcome, and is now planning for different spending updates through the budget revision and development of next year's comprehensive bond package.
"I'll keep working for a stronger Austin and focus on preparing for a bond election in November 2026. In the weeks ahead, we need to discuss what returning to the city manager's base budget means for our community and our goals," he said.
Council member Ryan Alter said many households are struggling to make ends meet, and city officials should now take clear steps to reduce spending.
"Austin has made real progress in reducing housing costs, but we must go further. Every decision we make should start with one question: How will this help those who are struggling to get by?" he said. "I’m committed to leading by example. That means putting forward new ideas to cut costs—including within our own office budgets—and ensuring every dollar we spend reflects our community’s priorities."
Council member Krista Laine called the proposition's rejection "deeply unfortunate," but understandable given residents' concerns about affordability. She also said Austin now faces "significant challenges" with fully funding city programs and services in the face of federal funding cuts and the state tax cap.
"Your City Council will reconvene to review next year’s budget and work carefully to minimize harm while continuing to prioritize the well-being and safety of our residents," she said. "Now, more than ever, we must put aside old differences and forge new partnerships, working together to strengthen the city we love and ensure that quality, core city services are accessible to all."
After the ballot measure's failure, council member Mike Siegel said City Hall needs to rebuild community trust while addressing financial fallout from the election.
"Council will be forced to make painful cuts that will negatively impact the quality of life and the efficacy of city programs and services," he said. "In the days ahead, I will connect with unions representing city workers and community organizations that work every day to protect our environment, promote education, and care for our community, because we need a strong and united alliance to help Austin residents survive and thrive despite the challenges we are facing during this troubled moment of history."
Council member Paige Ellis said she's focused on funding fire and emergency medical services as well as the parks department, and that she hopes to start working through budget revisions "as soon as possible."
"My colleagues and I respect the will of the voters and know that there is more work to do. However, my commitment remains the same: to keep Austin safe, livable, and forward-looking," she said. "I am confident we can come together and craft a budget that serves and supports all of Austin while being effective stewards of your dollars."
Council member Zo Qadri said he understood local concerns over Proposition Q and anticipates further conversations about the city's spending plans.
"I understand why, in a tough economy, asking households to pay more felt like too much. At the same time, I know this outcome brings uncertainty for the people who make this city what it is—our librarians, nurses, park staff and school support personnel," he said. "The message from voters is clear: We must work together to balance strong public services with affordability, transparency and responsible budgeting."
