The Austin City Council held a budget work session on July 15, 2025, focusing on the proposed budget for fiscal years 2026 and 2027. The primary goal of the meeting was to discuss adjustments necessary to achieve a balanced budget while minimizing impacts on city services and staffing levels.

The session began with an overview of significant budgetary changes. Key adjustments included an $11 million reduction in capital rehabilitation transfers and a $12 million cut to the housing trust fund. Additionally, a $10 million civilian wage increase was planned for fiscal year 2027, which would affect both the general fund and the support services fund.

A major point of discussion was the elimination of $16.8 million in funding for social service contracts. Council members expressed concern over the potential impact of these cuts on community services. While specific contracts have not yet been identified, a 20% reduction across all social service contracts was proposed. City officials indicated that they would work with departments to determine which contracts would be affected, allowing organizations time to adjust their budgets accordingly.

Council members voiced apprehension about the long-term implications of the budget proposal, suggesting that it may merely postpone necessary decisions regarding city services. They highlighted the need for discussions about a potential tax rate election, emphasizing that the motivation behind this consideration is not to increase spending but to ensure the delivery of reliable city services. The council acknowledged that many cities in Texas are facing similar challenges due to recent changes in state regulations.

As the meeting concluded, it was clear that the council would need to engage in further discussions with the community regarding the budget proposal and its implications for city services. The council's commitment to balancing the budget while maintaining service levels will be a critical focus in the upcoming weeks.