Houston Super Neighborhood Alliance Budget Briefing – May 11, 2026

City budget director Stephen David presented the proposed FY27 budget to the Super Neighborhood Alliance, outlining structural deficits, revenue caps, and two major fiscal reforms: declaring solid waste a utility with a $5 monthly administrative fee, and implementing a 5% gross revenue right‑of‑way fee from the combined utility system. Residents voiced concerns about fee regressivity, efficiency, and service impacts, while city officials committed to continued public engagement and a phased approach.

Public Comments & Testimony

• Tamara (Super Neighborhood representative): Questioned why the city’s revenue diversity slide omitted franchise fees from Comcast/AT&T, and suggested sunsetting Tax Increment Reinvestment Zones (TIRZs) in wealthier areas to increase general fund resources.
• Jack (East Houston, Super Neighborhood 49/50): Asked for a department‑by‑department budget chart and challenged the claim that a $104 million annual transfer from the water/sewer utility would not affect water rates or consent decree projects. He argued the $5 fee was a “fear‑and‑relief” tactic and proposed enforcing existing littering fines instead.
• Beverly A. J. (Super Neighborhood 68): Expressed frustration over repeated fee increases (drainage fee, water rate hikes, now solid waste) without noticeable service improvements, citing a neighbor’s $600 water bill and lack of responsive repair.
• Lindsay Williams (Super Neighborhood 64/88): Asked why none of the $5 fee would go toward solid‐worker safety equipment or pay, given that workers had recently petitioned City Hall. Stephen David replied that the fee creates a dedicated revenue stream for capital purchases (trucks, transfer stations) that will directly improve conditions.
• Lisa Hines (VP, Super Neighborhood 64/88): Described a neighbor on fixed income with reduced food stamps and argued the $5 fee is a regressive “political ploy.” She advocated for immediately charging the full $25/month cost to avoid prolonged burden and offered to subsidize lower‑income neighbors.
• Ken Rogers (Super Neighborhood 67): Noted that Houston’s once‑a‑week pickup is less frequent than many cities that charge higher fees, implying the $5 is insufficient.
• Andrew Mickelson (Super Neighborhood 30): Asked whether the $6/month sponsorship credit for private‑trash customers would be eliminated. David stated that by law the city cannot charge a fee for a service it does not provide, and the program will continue.
• Ms. Rainwater (Super Neighborhood 41): Pointed out that businesses like halfway houses generate large amounts of trash but are only charged the same $5 residential fee, calling for a separate commercial rate. David responded that commercial establishments should not be receiving city service, and asked them to report violations.
• Sylvia Rivas (Super Neighborhood 36): Representing a community with private trash service, asked how the city would identify those homes to avoid charging them. David said the city maintains a comprehensive customer database.

Discussion Items

• Revenue constraints: Stephen David explained that Houston faces the nation’s most restrictive property tax cap (lesser of 4.5% growth or inflation plus population growth, with population data lagging two years). This has forced the tax rate from $0.63 in 2011 to $0.51 today, creating a structural deficit projected at $209 million in FY27, growing to $446 million by FY30.
• Proposal 1 – Solid waste utility and $5 fee: Declaring solid waste a utility under Chapter 1502 moves its $117 million overhead from the general fund into a dedicated utility fund. The $5/month fee (for 383,000 residential customers) covers only administrative costs and will be held flat for two years, then increase to $10 (FY29) and ultimately to $25/month (the full cost per household per month). The fee will support a revenue bond for new trucks, transfer station repairs, and modernization. The city plans to create a hardship assistance fund similar to existing water assistance programs.
• Proposal 2 – Right‑of‑way fee (5% gross revenue): The combined utility system (water, sewer, solid waste) will pay a 5% gross revenue fee to the general fund, generating ~$104 million annually. David argued this is standard practice across Texas cities (e.g., Austin, Dallas) and will come from operational efficiencies already achieved, without increasing water/sewer rates or delaying consent decree projects. He cited excess debt service coverage (215% vs. 135% required) and cash reserves (550 days vs. 300‑day policy) as evidence of available headroom.
• Efficiency measures: Past savings include a voluntary retirement program (1,056 employees, $100 million/year) and the merger of 311 and water billing call centers. David acknowledged solid waste department inefficiencies (aging fleet, non‑functional transfer stations, lack of GPS routing) that will be addressed with the new dedicated revenue.
• Council Member Sally Alcorn announcements: She encouraged attendance at budget town halls (May 12 at Fondy Rec Center, 10 a.m.; May 20 virtual, 6 p.m.) and promoted the “Your Two Cents” survey. She also flagged a proposed update to the Open Space Ordinance that would redirect 30% of park‑dedication fees citywide and urged residents to attend a public hearing at the Planning Commission on May 14 at 2:30 p.m.
• Public safety concern: Attendee Rachel reported a drive‑by shooting victim who waited 12 hours for police, who allegedly said they do not work weekends. She requested the Mayor be notified.

Key Outcomes

• No formal vote was taken; the presentation was informational.
• Next steps: Budget town halls (May 12 in person, May 20 virtual) and continuation of city council hearings. The solid waste utility declaration and right‑of‑way fee will require council legislation in the coming weeks.
• Council Member Alcorn committed to revisiting a potential increase to the park‑dedication fee (currently $700 per unit) after the budget cycle, pending stakeholder feedback.
• Public engagement: Residents were encouraged to sign attendance sheets and follow online budget documents.

Additional Announcements

• Illegal dumping: Stephen David noted increased funding for HPD’s environmental unit and camera enforcement, with a shift from compliance‑based to enforcement‑based approach. The solid waste utility will also fund abatement equipment.
• Transfer station conditions: David described severe disrepair in three of five stations (northeast, northwest, central), with a 25‑foot hole in one roof, exposed wiring, and standing water. The new revenue bonds will prioritize repairs and reopen these stations.
• Private‑trash sponsorship: The existing $6/month reimbursement program (covering ~50,000 homes) will continue; David stated absorbing those homes would overwhelm the current system.