Houston Passes $5.1 Billion Annual Budget, Using Federal Aid To Plug Deficit

The city avoided budget cuts and layoffs, though Mayor Sylvester Turner said the pandemic caused the worst deficit in the city’s history.


Mayor Sylvester Turner at a Houston City Council meeting on June 2, 2021. Council passed Turner's $5.1 billion budget.

Houston City Council on Wednesday approved a $5.1 billion city budget for Fiscal Year 2022 that includes pay increases for firefighters and an additional $30 million for the police department, thanks to more than $600 million in federal COVID-19 relief.

In past years, the budget cycle has focused on closing significant funding gaps, but this year cuts or layoffs weren't on the table, thanks to $604 million from the American Rescue Plan Act, signed into law by President Biden.

The city will receive half of that federal funding this year and the second half next year.

The final budget passed by council increases just slightly the city's spending over last year. Mayor Sylvester Turner said that while the federal COVID relief funding prevented cuts, the city did lose significant revenue during the pandemic.

"2020, in many ways, from a financial end, was worse than Hurricane Harvey, because it has lasted for the last 14 months," Turner said. "Revenue reduction, quite frankly, of over $200 million. This is the worst budgetary deficit that we've faced in the history of the city."

In May, council members unanimously voted to give Turner control of those federal dollars despite pushback from some members of the public who asked the city to form a community task force to oversee the money.

The FY 2022 police department budget rose to $984 million while the fire department received $514 million. The city's housing department came in at $417,000 — though the department is in reality much larger, as the majority of its budget comes from federal funding.

According to the housing department's annual financial report, the department spent $193 million in FY 2020.

Turner said he's allocating some of the ARPA funding to pay for firefighter salary increases — an 18% increase over the next three years, beginning in July. The mayor and the firefighters union have been mired in an ongoing legal battle since the firefighters' contract expired in 2017.

Members of the Houston City Council on June 2, 2021.

The news comes the same day that the firefighters union announced it was pushing for a November ballot measure to require the city enter into binding arbitration in the case of a contract dispute.

Union President Marty Lancton had also called the purported raise a "bonus," since it is being funded by temporary federal dollars. The union has stressed that a raise must come through collective bargaining.

The budget also boosts police spending by $30 million, adding around 200 officers and 50 cadets. Violent crime has increased over the past year, with murders up around 40%.

In a workshop meeting last month to discuss the police department budget, HPD Chief Troy Finner argued Houston needs more cops on the streets.

"You have to be practical and look at your city," Finner said. "We need more police and we need much more funding."

But council has heard from dozens of community members in recent weeks calling for the city to reallocate part of the police department budget for others services, and some remarked that they didn't feel council members heard their feedback.

"It makes me sad to think that the thoughtfulness and curiosity and openness of some questions might be dismissed," Houstonian Saba Blanding said, calling in to the council meeting to speak on the budget. "What has been asked for is willingness to offer the citizens of Houston more than a false dichotomy of police or no police, an acknowledgement of the dignity and worth of all Houstonians — especially those that are frequently marginalized, such as the unhoused and the undocumented — for the city to address issues of health and safety that arise when departments are underfunded and understaffed, for a more participatory process to include the voices of our dynamic and diverse city."

Others echoed Blanding's request to rethink the city's budget process and shift some police funding to other departments.

"I just think it’d be great to start reinvesting that money into housing and healthcare and putting money away from policing for mental health," said Christopher Rivera, a community outreach coordinator with the Texas Civil Rights Project, citing results from a recent budget priorities survey from At Large Council member Sallie Alcorn's office.

Houston City Council Member Letitia Plummer on June 2, 2021.

With responses from more than 1,600 Houstonians, three spending priorities topped the list: homelessness and mental health, public works, and public safety.

"Homelessness & mental health services were selected by more than double the amount of respondents compared to last year," the report concluded, "likely a result of evictions during the pandemic and a heightened public focus on the role of mental health services in our criminal justice system."

Controller Chris Brown warned in a recent opinion piece in the Houston Chronicle that the federal funding shouldn't go toward increasing recurring expenses, and some council members expressed concerns about how the city will continue to afford higher personnel costs after the ARPA funding has been spent.

"It really does worry me to spend one-time funding on recurring expenditures," Alcorn said.

Council approved the final budget, with At Large Council member Mike Knox voting "no." At Large Council member Letitia Plummer intended to vote against the budget as well, but was unable to change an accidental "yes" vote.

In a statement, Plummer said despite the administration's work creating the budget, she opposed raising firefighters' pay without going through the collective bargaining process, and the decision to use federal funding to plug immediate budget gaps instead of finding a longer-term use for the money.

"I am ever so grateful for the $7.9 million that is being spent on much-needed police reform, something that I have been pushing since my last budget amendments, but the fact that the program is using American Rescue Plan Act funds tells me that that this again is a temporary fix," Plummer said. "It is a program that in three years has a potential of dying out. The 60,000 people who marched last year deserve better."

Council members filed more than 100 amendments to the budget, many of which were referred to council committees for further discussion or withdrawn due to opposition from the mayor.

Among the amendments that passed was a measure from Alcorn that will create a residential composting pilot program, an amendment from District A Council member Amy Peck advising the solid waste department to send automatic text messages for those who opt in to remind them of their trash and recycling days, and another from District C Council member Abbie Kamin that sets the groundwork for the city to create a mandatory recycling program for multi-family residential properties.

An amendment from District G Council member Greg Travis failed that would have used $2.4 million in ARPA funding to create an additional HPD cadet class.

Plummer introduced an apartment inspection reform amendment to boost apartment complex safety. The amendment would have created a new $250 fee for multi-family properties that would be used to hire eight additional inspectors, but it failed to pass.

Plummer said she wrote the amendment after seeing abysmal living conditions while she canvassed apartment complexes to inform renters about their rights under the federal CDC eviction order.

"I was devastated by what I saw. The way in which people are living is devastating," Plummer said. "From a public health perspective, I do believe this is critical."

Instead of passing the amendment, Turner referred it to a council committee for further discussion.

"It is something we need to consider in terms of whether or not there should be a fee, and what that fee should be," Turner said. "But there is still a lot of vetting that needs to take place and it needs to be presented in the form of an ordinance."

Turner said he supported the measure and committed to bring an ordinance to council within 90 days.

"I will allow this to go to committee," Plummer said, but insisted that council vote on the matter quickly. "It is very easy for us to sit here and have conversations about why it takes a long time for governing to occur, because we're not living in a rat-infested, mold-infested apartment. We're going to a very warm, comfortable space."

Additional reporting by Paul DeBenedetto.

Today in Houston Newsletter Signup
We're in the process of transitioning services for our Today in Houston newsletter. If you'd like to sign up now, fill out the form below and we will add you as soon as we finish the transition. **Please note** If you are already signed up for the newsletter, you do not need to sign up again. Your subscription will be migrated over.