Groups want more money for homeless services, but Austin faces a possible budget deficit

AUSTIN (KXAN) -- As the City of Austin approaches its midyear budget review, advocacy groups like Vocal Texas and the Texas Harm Reduction Alliance, were outside City Hall Thursday asking for additional funding for homelessness services.

"I was homeless. I never thought in a million years I would be homeless but I ended up finding myself homeless at a point. I was homeless for two years," said Vernon Jarmon, who participated in Thursday's rally.

Austin City Council approved a record-large $5.5 billion budget last year. But financial leaders with the City of Austin cautioned Austin City Council late last month about assigning additional dollars to programs until the city can better understand a possible budget deficit for the 2024 fiscal year.

That possible deficit was caused by an unexpected dip in sales tax revenue, they said.

The City’s Financial Services Department said it's short $8.5 million so far this fiscal year in predicted sales tax revenue and suggested if that revenue stream remains flat, the deficit could go up to $15.4 million by the end of the fiscal year. The fiscal year starts October 1.

“We built our FY 24 budget assuming 4% sales tax growth so flat is not good enough. If our sales tax remain flat against that 4% assumption that we made in the budget, we are going to have a budget deficit that we’ll need to deal with,” said City of Austin Chief Financial Officer, Ed Van Eenoo. Those budget discussions will happen in the next couple of weeks.

Playing into that conversation are programs city council asked the budget office to roll back around to midyear, some of which haven't had funding fully assigned to them yet. One that was a focus of Thursday's rally -- tenant stabilization.

"It is one of the most urgent priorities in our city right now," said Kathy Mitchell with Equity Action.

The groups outside of City Hall Thursday want the city to prioritize homelessness services during its midyear budget review -- like that tenant stabilization program.

"We're human. We want to help one another. We want to see people be happy, be able to get the service that they need here in Austin," said Jarmon.