The budget is the “final one but is also the best one,” said Turner, who was elected to his first term in 2015 and whose second term will expire in January. Turner presented the proposed budget at a news conference held at City Hall on May 16.
The overview
The total proposed budget for FY 2023-24 includes $6.2 billion in expenditures, an increase of $379.2 million or 6.6% from FY 2022-23. The majority of the increase, $199 million, is attributed to higher operations and maintenance costs associated with the city's water and wastewater system.
The specifics
- Police and fire make up $1.6 billion of the budget. This includes funding for five police cadet classes and four fire cadet classes. Turner said at the press conference that the city has been able to drop the number of police officers eligible for retirement from 38% in 2016 to 28% as the city has enlisted about 2,200 cadets.
- Pay increases of 3% for police officers, 6% for firefighters and 3% for municipal employees are included in the budget. The cumulative pay raise is valued at $115 million.
- The budget establishes an Other Post Employment Benefits—or OPEB—trust with an initial donation of $10 million from the city. The fund will reduce the city's unfunded OPEB liability to $1.1 billion by 2048.
- A transfer of $11.3 million will be made to the maintenance renewal and replacement fund, increasing the total fund to $42.9 million. The transfer is meant to address deferred maintenance. City officials estimate roughly $594 million in total deferred maintenance of city facilities.
- Ad valorem tax revenue continues to pay down the city’s street and drainage debt. It is proposed an additional $47 million will go to projects in FY 2023-24. FY 2021-22 saw $76 million transferred to the dedicated drainage and street renewal fund, and FY 2022-23 saw $123 million transferred.
- The city owes $637 million in pay-as-you-go debt, including $521 million in principal and $116 million in interest. These debts, which started at around $2.4 billion, are down after the city paid about $1.8 billion.
- The proposed budget’s ending fund balance is $401 million, $220 million above the minimum 7.5% requirement for the city.
“This is my final budget, and I am proud to say I leave to the next mayor a budget that is better than it has been in a long, long time,” Turner said. “But I owe it to [the] partners that I've had.”
Going forward
Work on the budget will continue at a series of workshops through May 25, which are open to the public. These workshops will also be livestreamed on HTV’s streaming platform and Facebook page. The budget could be adopted by Houston City Council in June.
