Dallas City Council member concerned about city's rate of spending

With property values soaring, some Dallas City Council members are concerned about the size of the city's spending along with it. 

One council member pointed out that if the city's spending continues at this pace, its reserve fund would no longer be at the recommended level in just three years. 

According to best financial practices for cities and the city's own policy, it should have enough money in reserves to run the city for at least 50 days.

At the current pace, the city's reserves would dip below the recommended level in just three years. 

When it comes to the budget, times are good in Dallas right now with big increases in property and sales tax revenue.

But Dallas City Councilwoman Cara Mendelsohn says the long-term forecast shows the city relies heavily on its reserves.

"So, we would go from $308 million in reserve to only $65 million in reserve after five years. And this is better than last year due to an increase in sales tax?" she asked.

"That is correct," a city staff member said.

Dallas city staff explained that while the forecast looks alarming, the city would never let reserves get that low. 

"Historic forecasts will typically show a deficit looking at years 3-4. We have always assured rating agencies we would take action," said Dallas Budget Director Janette Weedon.

Mendelsohn explained that the action the city would have to take would be painful.

"My concern is even though there is a large tax reduction, there is a lot of talk about adding programs," she said. "But at the end of the day, the only two options will be massive cuts or a massive tax increase."

While the city manager's proposal does not include any budget cuts, it does reduce the property tax rate by 2.75 cents. The city projects the cut would save a typical homeowner $70.

But because property values have increased, most property tax bills will still be more than last year even with the cut. 

And the city can't rely too heavily on homeowners. State lawmakers have taken steps to limit the tax burden by capping increases for many on their property values.

Mendelsohn says the city needs to continue to look for ways to be more efficient. 

"We want to make sure we’re talking about continued tax reduction in future years," she said.