The Dallas City Council approved a $120 million property tax increase on Wednesday as part of the $4.63 billion budget for the upcoming fiscal year.
The budget and tax increases were opposed by several elected officials, including Mayor Eric Johnson, but were ultimately passed by the council.
Before the budget and property tax rate for fiscal year 2023-24 were finalized, Council Member Cara Mendelsohn proposed a final amendment to reduce the property tax rate by 5.33 cents.
She reaffirmed her position that the $0.7357 rate later adopted by the council, while technically being a tax rate decrease of one cent from the current fiscal year, would actually result in a property tax bill increase for most Dallas residents. Mendelsohn has previously advocated for a “no-new-revenue” property tax rate of $0.6813 — more than five cents less than the $0.7393 recommended by City Manager T.C. Broadnax.
However, her amendment failed and was only supported by two of her colleagues — Council Member Chad West and Mayor Eric Johnson. Council members finally approved a $4.63 billion budget with a $0.7393 property tax rate that will increase tax payments to the City by $120,472,041.
This marks a 9% increase in property taxes year over year, according to City documents.
Council Member Mendelsohn also delivered a statement during the council meeting in which she said the “teeny tiny tax rate decrease that has been passed by this council” is actually a “property tax increase.”
“Telling people you voted for a tax rate deduction and sending them a higher bill is misleading to the residents,” she said. “They’re smart enough to understand their value has gone way up. The rate needs to go way down, or they’re going to pay a lot more.”
She added that this increased tax burden will not stop at property owners, as landlords will consequently raise the rent on their tenants to offset their costs.
Other council members said they have a responsibility to approve a budget that services the residents of Dallas. Some argued that increased spending is necessary to provide adequate services and claimed that rising property values are a sign Dallas is moving in the right direction.
“The increase in the value of our homes is because we’re successful as a City,” said Council Member Jaynie Schultz, claiming that residents benefit from the value of their homes going up.
Furthermore, she said, “We can’t say we’re going to cut staff [and] cut services and expect to have a better city. We also can’t cut and cut in order to [give] people a flat tax rate and expect their home values to go up because things will not get better as a City. Their home values will go down.”
Shultz also wrote an opinion piece for The Dallas Morning News that was published Wednesday morning in which she argued that Dallas should support more spending and “choose abundance over scarcity.”
Council Member Carolyn King Arnold again cited “equity” as the chief reason why the City should increase taxpayer spending.
The council members who voted against the final version of the budget were Mendelsohn, Paul Ridley, Gay Donnell Willis, Kathy Stewart, and Mayor Johnson.
Mayor Johnson noted that, unlike the rest of the council members, who are elected to represent individual districts, he has a responsibility to represent the interests of the entire city of Dallas.
“The idea that we should lower the tax burden on Dallas residents — not lower an imaginary number, a rate, a variable in the calculation — didn’t just come to me from nowhere. It came to me from the residents of the city of Dallas. It’s actually what the residents want,” he said. “It’s what they need.”
“People in the city who want tax relief the most are actually are most economically challenged residents,” he continued. “It’s the people of color, believe it or not. At a higher rate than Dallasites overall, it’s African Americans and Latinos who are begging for property tax relief.”
The mayor also released a statement after the vote highlighting his vote against the budget.
“In an environment of such economic uncertainty for our residents and businesses, with inflation and interest rates being where they are, I simply could not vote for a budget that is the largest in the history of the city and that is paid for by raising taxes on our residents and businesses,” he said.
“It is simply not the case that we could not have significantly reduced the size of this budget and cut taxes without drastically cutting essential services. Furthermore, it is preposterous to suggest that our city government could not, by being more efficient, deliver essential services next year using the same amount of tax revenue collected from Dallas residents and businesses just a year ago.”