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City Hall Hustle: Trimming Tax Breaks and Tweaking Services

Council follows the money – what little there is

By Wells Dunbar, Fri., May 13, 2011

With the excitement of City Council elections peaking, providing the maximum amount of perverse pleasure to the approximately 7% of the population that can be bothered to turn out (based on early returns, that's the Hustle's guess), yes, it's easy to forget that the day-to-day must carry on at City Hall.

Council convenes for a relatively robust agenda this Thurs­day, May 12, its last before Saturday's election. While there are some high-profile items – including a final resolution to the Holly Street Power Plant decommissioning fracas – what should draw attention is the end (one hopes) of argument over changes to the city's property tax abatement program for historic homes and the beginning of council debate over drastic changes to the suite of city-funded social service contracts.

Item 42 encompasses those long-awaited changes to tax exemptions for historic homes. The resolution caps the property tax exemption for an owner-occupied historic property at $2,500; it will also index the cap "based on future increases or decreases in property values due to inflation and deflation," and abandon the previous process that exempted the land and property at different amounts. The changes will be immediately implemented for all new residential property requests, those approved after Jan. 1, 2010, and for all that have a change of ownership; those grandfathered homes that have had the designation in place longer will have their exemptions gradually reduced to the limit over five years (provided they're over that $2,500 threshold to begin with).

The ordinance also calls on the city manager to "develop details of a rehabilitation program ... to encourage and promote continued rehabilitation projects on individually-designated historic buildings," perhaps similarly to the once-floated idea of offering low- or no-interest loans for homes requiring financial assistance to make historically accurate repairs and improvements.

Moving along, council's 10:30am presentations aren't traditionally the realm of major controversy, although that might be changing: What's billed as a social service briefing is a reprise of the presentation made to council's Public Health and Human Services Committee earlier this week, regarding staff recommendations in the similarly long-winded process of reallocating the city's limited social service dollars.

As we reported last year, the collection of social services funded by the city – encompassing health care, financial assistance, job training, and other forms of help for Austin's least fortunate – was set by council in the 1990s and has not been reallocated since. (See "Scaling the Pyramid," Oct. 15, 2010.)

The initial recommendations that came before the council committee Monday were doozies: Of the 51 agencies currently funded, staff recommended only 23 "for some level of funding." According to staff's presentation, nine agencies didn't reapply for funding, meaning 19 agencies that did reapply weren't recommended for continued funding. Making the cut with high-scoring proposals were major providers such as Meals on Wheels and More, LifeWorks, and Caritas of Austin, but some similarly prominent providers, like the Salvation Army and Capital IDEA, were not recommended.

That's partially due to the prioritization scheme council approved, and its accompanying funding allocation. After months of wrangling, council settled on five areas toward which to focus the city's limited dollars, ranked in importance: safety net/infrastructure, transition out of poverty, problem prevention, universal support, and enrichment. So in the staff recommendation, the first two goals each receive more than $5 million of the total $13.2 million; problem prevention would get only $2 million, universal support $570,000, and enrichment only $23,000. As staff notes, its recommendations don't include services from providers who focus on mental health, substance abuse, legal services, and long-term employment training. The presentation adds that "similar services are addressed in comprehensive, integrated service models," and indeed, the whole point of the realignment is to leverage the city's limited dollars, likely through such integrated programs.

However, with such a major shake-up under consideration, we're sure these allocations are far from a done deal. Following the presentation, council action is anticipated at its May 26 meeting, and instead of including all new contracts as part of council's fiscal year budget (up for adoption in September), staff recommends extending the existing contracts six months, to May 31, 2012, to allow for more transition time.

Speaking of services, let's not forget Item 13, a proposed $150,000 in funding for the African American Youth Resource Center. Following an April 28 item calling for funding – sponsored primarily by current incumbent candidates Randi Shade and Chris Riley – In Fact Daily recently quoted African American Resource Advisory Commission co-chair and full-time firebrand Nelson Linder questioning the timing of the allocation. "Those two people are being criticized in many black communities about what they didn't do last year," he told IFD about Riley and Shade, referring to their controversial votes in the Nathaniel Sanders II settlement.

Vote this Saturday, May 14, and stay tuned to Election Central this weekend for all your election night updates: austinchronicle.com/elections.

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