City Manager T.C. Broadnax is at odds with Mayor Eric Johnson and Council Member Cara Mendelsohn regarding how to spend taxpayer money and whether to reduce the tax burden on Dallas residents.
Mendelsohn released a memo last week urging City leaders to exercise “fiscal restraint” and lower taxes on Dallasites by considering a revised budget based on a “no-new-revenue” (NNR) tax rate scenario, as previously reported by The Dallas Express.
The District 12 council member garnered the support of Mayor Johnson, who subsequently directed City Manager T.C. Broadnax to develop such a budget, which would see the City operate at the same $4.5 billion it is currently using.
Broadnax’s current budget proposal amounts to $4.6 billion in taxpayer money. Mendelsohn said that while “the FY23-24 proposed budget provides for a slight tax rate reduction … [it] still increases the tax burden on residents and businesses.”
Mendelsohn said adopting an NNR property tax rate and a budget based on this tax rate would reduce the tax burden on Dallasites.
“The no-new-revenue rate … [is] a tax rate that would produce the same amount of taxes if applied to the same properties taxed in both years,” according to the Texas comptroller’s website.
For Dallas, that rate would be $0.6813, a $0.058 reduction from Broadnax’s proposed rate of $0.7393 for FY23-24, resulting in a $113 million reduction in property taxes collected by the City, according to a presentation delivered to council members by City staff on August 8.
“The city of Dallas’ proposed tax rate ($0.7393 per $100 value) makes no sense given that property value growth is through the roof, inflation has wrecked most family budgets, and virtually every other neighboring community imposes a dramatically lower rate,” said Texas Public Policy Foundation (TPPF) Policy Director James Quintero, supporting Mendelsohn’s call to adopt an NNR tax rate.
In her memo, Mendelsohn referenced a report from TPPF showing how Dallas’ tax levy has consistently increased despite a stagnant or shrinking population and skyrocketing inflation.
In a statement to The Dallas Express, Quintero said, “Dallas residents should be encouraged by recent moves to reduce the cost of city government and adopt a lower tax rate. This will ultimately lower tax bills for everyone and shore up family budgets that have been ravaged by inflation.”
“City spending has long exceeded population and inflation increases, suggesting that there is ample opportunity to find efficiencies and stretch a dollar,” suggested Quintero. “All that’s needed now is the political will to prioritize taxpayers.”
However, Broadnax has a different perspective. As previously reported by The Dallas Express, Broadnax’s proposed budget included a new property tax rate of $0.7393, a $0.0065 reduction from FY22-23, which had a property tax rate of $0.7458 per $100 valuation.
In a prior statement to The Dallas Express, communications director Catherine Cuellar said Broadnax did not publish information about the NNR tax rate on August 4 along with his proposed budget because this rate is “not recommended by the City Manager.”
Broadnax told WFAA he “submitted the No-New-Revenue tax rate scenario as required by the City’s Financial Management Performance Criteria … [and is] reviewing the request from the Mayor and look[s] forward to continued discussion regarding the FY24 Proposed Budget.”
In an August 7 memo, Chief Financial Officer Jack Ireland said $123.6 million in spending would need to be eliminated if an NNR tax rate budget were adopted.
“The City Manager does not recommend this tax rate nor these reductions,” Ireland said, per WFAA.
As previously reported by The Dallas Express, the City continues to spend increasing amounts of taxpayer money hiring workers and paying them significantly more than they would earn for the same job in the private sector. Moreover, low-level workers are included in the City’s pension plan.
In her memo, Mendelsohn suggested eliminating “ghost” positions — full-time positions that have not been filled.