Houston abandons plan to raise property taxes, having received money from the state

HOUSTON, Texas (KTRK) -- Houston City Council abandoned a plan to raise property taxes Wednesday. The decision was made after the city received millions of dollars in aid at the last minute from the state.

The proposal to raise taxes was placed on the agenda by several council members. The decision was made after Controller Chris Hollins predicted a budget shortfall of $230 to $280 million for the city in the next fiscal year. Hollins explained that the city's credit rating was predicted to be knocked down if it did not change course.

The proposal would have raised taxes by approximately 6%, which is about $100 a year for an average household.

Mayor John Whitmire says he met with the governor and other state leaders last week to ask for help offsetting about $50 million in expenses the city incurred during May's derecho and Hurricane Beryl.

The state has now promised $50 million for storm recovery to dozens of counties. The mayor, declining to provide an exact number, said most of the money will go to Houston.

"Even with the $50 million, which is great, it's a one-time deal, right? We have to find a way to have sustainable recurring revenues that we can use to secure a sound financial future," Councilmember Edward Pollard said.

Whitmire acknowledged the city's finances remained unsustainable but insisted he would not raise taxes before he could ensure the public excess had been cut.

An Ernst & Young audit, which will be used to cut spending from the city government, is expected to conclude this month.

According to our partners at the Houston Chronicle, Mayor John Whitmire wants to focus on cutting government waste. His proposal keeps the current rate of just under $0.52 per $100 of a home's appraised value.