City of Houston Special Announcement
May 30, 2018
City of Houston _______________
Amanda K. Edwards, At-Large 4 Special Announcement
| Special Announcement
May 30, 2018
On May 30, 2018, City Council approved the City of Houston's budget for Fiscal Year 2019 (FY19), by a vote of 13-4. The City's fiscal year begins on July 1, 2018 and ends June 30, 2019. The total approved budget amounts to approximately $4.9 billion, of which, approximately $2.48 billion in expenditures are allocated to the tax-supported General Fund. The FY19 Budget also includes funding for Houston's Enterprise Fund operations, such as: Aviation, Convention and Entertainment Facilities, and the Combined Utility System. Unlike the General Fund, Enterprise Funds are not funded by property or sales taxes; rather, these funds are covered entirely by user fees or other dedicated revenue sources.
The City used a combination of drawing down the City's reserves, transferring approximately $15.8M from special revenue funds and implementing an additional $7.3 million in departmental spending cuts to close the $114M shortfall without resorting to laying off City employees. Many City departments and the Mayor's Office participated in "shared sacrifice" by taking such actions as eliminating unfilled vacancies in personnel and reducing supplies. This is the third year in a row that the Mayor has recommended budget cuts for the city; however, both the Police and Fire departments were exempt.
At the press conference for the unveiling of the proposed FY19 Budget, Council Member Amanda Edwards was asked by reporters about her view of the budget, and she explained the City Council would be looking to find additional savings, while sustaining services for residents.
Council Member Edwards submitted amendments to the FY19 Budget designed to push the City towards fostering more innovation, achieving financial stability, and acting with strategic purpose for the benefit of all Houstonians. Council Member Edwards proposed an amendment to create a Task Force to make recommendations as to how Houston can become THE leading city for both women and minority owned businesses. In addition, in the aftermath of Hurricane Harvey, she proposed a budget amendment to change the standard of when government emergency responders evacuate registered elderly and disabled people from their homes during a time of a widespread emergency. This amendment will make assistance evacuations more accessible and less confusing for vulnerable populations who sign up for a state registry. She also proposed an amendment to survey the needs stemming from Houston's "digital divide" and solicit proposals to service providers to provide low and no-cost Wi-Fi access to all Houstonians who need it, including those in Complete Communities. She also proposed an amendment to push the city to be more strategic when deciding when to sell surplus or vacant lands via a Real Estate Strategy. Council Member Edwards' amendments are listed below in their entirety. The budget amendment creating the Task Force for Women and Minority-Owned Businesses passed unanimously as part of the FY19 budget. However, Council Member Edwards withdrew her other three amendments in order to allow more department engagement and pass these measures via ordinance, as appropriate.
Make Houston #1 City for Women and Minority-Owned Businesses (Amendment Unanimously Passed by City Council)
Although an Expert Market study ranked Houston as 1st in the nation overall for minority entrepreneurs in 2017, minority-owned businesses are still denied loans at three times the rate of non-minority firms, according to the Minority Owned Business Development Agency.
To make Houston THE Leader in the country for both women-owned businesses and minority-owned businesses, the City of Houston shall establish a Women & Minority-Owned Business Task Force to further support, attract and retain women and minority businesses.
The Task Force will make policy recommendations as well as analyze best practices from other cities. The Task Force will examine how to foster an atmosphere of growth for women & minority businesses, including but not limited to, examining ways to (1) increase access to capital for minority & women owned businesses and (2) "scale up" businesses to allow them to expand, grow, and find for higher yield returns.
The Task Force shall be comprised of various members, including but not limited to representation from the Office of Business Opportunity, community business leaders, as well as representation from various ethnic and gender based chambers of commerce, including but not limited to: the Greater Houston Women's Chamber of Commerce, the Greater Houston Black Chamber of Commerce, Acres Home Chamber for Business & Economic Development, the Houston Hispanic Chamber of Commerce, the Asian Chamber of Commerce, the Indo-American Chamber of Commerce, the Vietnamese American Chamber of Commerce, South Asian Chamber of Commerce, Pakistan Chamber of Commerce, Korean American Chamber of Commerce and the National US-Arab Chamber of Commerce, among others.
Disaster Evacuations for Elderly and Disabled Populations (Amendment withdrawn by the Council Member and added to the Office of Emergency Management's Existing Proposed Revisions to its Mitigation Plan and procedural changes commencing prior to Hurricane Season)
To increase the assistance afforded to Houstonians with disabilities or heightened functional needs in the time of a disaster, the City of Houston shall modify the threshold triggering mandating assistance for STEAR registrants. Specifically, instead of requiring a mandatory evacuation event to occur to assist STEAR registrants, the City of Houston shall instead invoke STEAR evacuation assistance in the event of an applicable "State Disaster Declaration" by the Governor of the State of Texas, in which Harris County, Fort Bend County or other counties that may rest within the boundaries of City of Houston is a designated disaster area. During such event, STEAR registrants that reside in and are physically within the boundaries of the City of Houston would be eligible for evacuation assistance through STEAR, if desired. Doing so, will keep more Houstonians safe and will better meet the expectations and needs of Houstonians in times of crisis. To the extent funding is required for this modification, such funds shall be derived from the City of Houston Disaster Recovery Fund (Fund 5303) or the General Fund (Fund 1000), if funding from the Disaster Recovery Fund is not available.
Access to Low Cost and Free Internet/Wi-Fi Connectivity (Amendment withdrawn due to existing negotiations with the City of Houston)
The City of Houston (1) may seek to commission a survey and detailed report of Houstonians' home Internet usage or lack thereof to identify "Internet deserts"; and (2) shall issue an RFP to identify one or more Internet service providers that are willing to commit to deploying advanced wireline and wireless that can provide high-speed Internet to residences and businesses at low and no-cost in areas that may lack access to connectivity, including but not limited to those pilot communities in the Complete Communities Initiative.
Real Estate Strategy (Amendment withdrawn; will be presented before Budget & Fiscal Affairs and/or Economic Development Committee; The Real Estate Strategy will be created via ordinance)
City Council also approved other amendments to the FY19 Budget related to the following:
The final text of the approved FY19 Budget will be posted online in the coming days. To learn more about the proposed FY19 Budget, please click on the link: http://www.houstontx.gov/budget/19budprop/index.html
Impact of Previous Years' Budget Amendments
The budget is the primary driver of municipal policy; it utilizes the City's money to fund and further policy implementation and services. The budget process presents critically important opportunities for a Houston City Council Member to effectuate change, as well. The highlights below demonstrate the impact of Council Member Edwards' FY17 and FY18 budget amendments.
Innovation and Technology Task Force
In 2016, Council Member Edwards authored a FY17 budget amendment that created the Mayor's Innovation & Technology Task Force. This Task Force examined best practices of other cities and made key recommendations to the Mayor and City Council about how to make Houston a hub for technology and innovation. The work of the Task Force, combined with efforts of the Greater Houston Partnership and more have led to a burst of progress in making Houston a recognized innovation hub. Now, the Task Force, Houston Technology Center, and the Greater Houston Partnership's Roundtable have combined efforts to become Houston Exponential, the convening entity tasked with implementing the recommendations. The Task Force's recommendation of creating an innovation district helped pave the way for the recently announced Innovation District, which Rice University is building at the old Sears building in Midtown. Many more of the Task Force's recommendations may be found here: http://www.houstontx.gov/council/4/Tech-and-Innovation-Task-Force.pdf.
Special Revenue Account Review
Various City departments budget and receive proceeds of dedicated revenue sources in what is known as Special Revenue Funds. Council Member Edwards proposed a FY18 budget amendment in 2017 that required the Finance Department to analyze each "Special Revenue" Fund and make recommendations as to whether this money could be used in different ways. It was an important way to help ensure funds are being used for the maximum benefit for the public. In fact, the exploration of these Special Revenue Funds contributed to the City closing its anticipated FY19 budget gap by approximately $15.8M.
Appraisal Districts & Multi-Year Settlements
When property tax lawsuits against appraisal districts settle or result in a judgment in favor of the taxpayer, the result can sometimes mean that the City must pay a multi-million lump sum figures (particularly when involving large taxpayers such as commercial industrial entities) within a short period of time (e.g. 60 days). In previous years, these actions would catch the City off-guard and would have an immediate adverse impact on the City's finances. In 2017, Council Member Edwards authored a FY18 budget amendment that would require the Harris County Appraisal District, Fort Bend County Appraisal District and the Montgomery County Appraisal District to enter into Memoranda of Understanding (MOUs) with the City. This facilitates a process whereby these districts let the City know the status of litigation in advance, and it will give the City the opportunity to potentially negotiate a settlement that can be paid over the course of several years, so the City does not take such a large financial hit all at once. Two of the three MOUs were finalized and executed in May 2018.
Smart Cities Initiative Strategic Plan
In order to further cultivate innovation in Houston in a manner that enhances quality of life for Houstonians, Council Member Edwards authored the FY18 budget amendment that called for the development of a Smart Cities Initiative Plan. The plan would help the City access grant funding and create strategies for establishing partnerships around smart city technologies to brand Houston as a smart city of the future. Under the leadership of Mayor Turner, the objective of the initiative is being realized via a multi-year partnership with Microsoft. Specifically, through Microsoft's blueprint, Microsoft and the City will help implement the use of smart city technologies in Houston. The planning process will commence in June 2018.
Modification of the City's Financial Policies
In 2016, Council Member Edwards proposed a FY17 budget amendment to the City's Financial Policies to ensure more transparency and monitor the community impact with respect to the City's economic development tools. In May 2018, the City Council approved modifications to the City's Financial Policies, and they included Council Member Edwards' budget amendments, among other things. With her amendment, the Local Economic Development Policies referenced in the Financial Policies now require annual review of existing economic development agreements relating to tax abatements, Chapter 380 Agreements and TEZ endorsements to increase transparency in a variety of additional ways. Specifically, such annual reviews will evaluate these economic development tools to assess (1) the projected economic value to the City (at the time of execution of the agreement) through the respective project's completion; (2) any alterations to the projected economic value to the City; (3) economic benefits since the execution of the respective agreements; and (4) an analysis of the positive and negative impacts (economic and otherwise) on the community and immediately surrounding communities. This measure provides both transparency and accountability to the public to make sure Houston communities benefit.
While at first glance, the budget may appear to be just a financial accounting. However, it serves a much greater purpose, which is to ensure that the City functions well, has sound fiscal management, the needs of residents are properly addressed, and that Houston realizes its potential.
Thank you for taking the time to read this Special Announcement regarding the Fiscal Year 2019 Budget!
 Mayor's Office Press Release: Mayor Turner Proposes FY 2019 Budget: