Austin City Council advances childcare property tax exemption approved by voters Tuesday

AUSTIN (KXAN) – The Austin City Council approved a resolution to implement a 100% property tax exemption for eligible childcare facilities just two days after Texas voters approved a proposition allowing the city to do so. 

Roughly 65% of Texans who voted Tuesday approved Proposition 2, which amended the state constitution to provide some financial relief to childcare facilities through property tax exemptions. In anticipation of the proposition’s passage, District 10 Council Member Allison Alter wrote a resolution to ensure eligible centers can receive 100% abatement by the time the 2024 financial year begins. 

“As federal funds expire, we are on the precipice of what experts call ‘a child care cliff,’” Alter said, referring to a Texas Association for the Education of Young Children survey reporting that "without more funding, up to 44% of child care centers in Texas could close their doors."

“Our economy can’t function without affordable childcare,” she continued. “This property tax exemption will provide financial relief to providers so they can continue serving Austin’s working families.”

The resolution also directs the Interim City Manager to explore similar relief opportunities for home-based childcare centers, which are not eligible for the tax abatements under the new state legislation, according to a press release. 

Alter’s resolution was approved on consent at the Nov. 9 City Council meeting, making Austin the first Texas city to advance the proposition approved by voters. 

“We’ve seen our home-based and family childcare folks get left out of the narrative time and time again,” Michelle Mejía, Early Childhood and Family Health Organizer at Go Austin/Vamos Austin, was quoted saying in a press release.  “We applaud our childcare champions at the city level for moving swiftly and responding to the dire needs of our early childcare community.”

In order for a child care facility to qualify for benefits, it must be licensed, have more than 20% of children enrolled in subsidized state child care fund and the owner must be involved in the  Texas Workforce Commission’s Rising Star Program.