Ellen Troxclair incorrectly says Austin's city taxes surged as family incomes inched up

An Austin City Council member declared that city property taxes have lately surged with family incomes failing to keep up.

Ellen Troxclair, who represents District 8 in Southwest Austin, told Lauren Petrowski of Austin’s Fox 7 on a February 2017 edition of "Good Day Austin" that she wants the city this year to "move the needle" versus the local cost of living.

In the interview, Troxclair touted her affordability action plan, which was set aside by the council a week later.

Troxclair: "Since 2012, property taxes have gone up almost 30 percent—"

Petrowski: "Wow."

Troxclair: "—while incomes have only risen 4 percent. So people are really struggling to stay in the city."

Let’s gauge the proclaimed tax changes, then the described changes in income.

City taxes up?

By email, Troxclair aide Alice Claiborne said the nearly 30 percent statistic was derived by comparing the city property tax bill on a median-valued non-senior homestead as reported in the city budget for 2016-17 with the bill on a median-valued residence as stated in the city’s 2011-12 budget.

The budget for fiscal 2011-12, which began in October 2011, states: "The median property tax bill is estimated at $879 per year" on a median-priced residence. The 2016-17 city budget estimated the city property tax bill on that year’s median-valued non-senior homestead at $1,132.96--which was 29 percent greater than the noted 2011-12 figure.

Yet, we noticed, that comparison looked at different classifications of property.

Single-family residences sweep in stand-alone homes, townhouses, condominiums, row houses and mobile homes regardless of who lives there. "Homestead" refers to an owner-occupied residence that can qualify for tax breaks. In 2016, according to the Travis Central Appraisal District, Austin had 183,423 single-family residences; 130,253 Austin property owners claimed a homestead exemption.

By email, a city budget official, Ed Van Eenoo, advised that at the council's direction, the estimated tax bill in the 2016-17 budget was limited to non-senior homesteads, meaning those properties affected by increased exemptions adopted by the council. He confirmed that was a change from the 2011-12 budget.

To reach a balanced comparison, we asked for the appropriate 2011-12 figure to compare with the 2016-17 tax estimate. Van Eenoo replied that the city tax tab for the median-value non-senior homestead in 2011-12 was $967.02. The 2016-17 tax bill for that type of homestead was 17 percent--not 29 percent--greater.

Homestead tax changes

Even so, we realized, that percentage doesn’t reflect actual changes in city-levied taxes for any given property.

For starters, increases in the median-valued homestead were influenced by new and more valuable homes landing on the tax roll.

Beyond that factor, we wondered how much more actual homeowners faced in 2016-17 city taxes compared with what the homeowners paid in 2011-12.

To gauge that, we turned to Marya Crigler, chief appraiser for the appraisal district, which appraises local properties for taxation purposes. We asked Crigler to focus on city taxes on specific homesteads occupied by the same owner or owners in the period so we could see how each homeowner fared by 2016.

Crigler emailed us tax data for eight geographically dispersed Austin homesteads whose owners in 2011-12 had paid city taxes of $967, which was then the bill for the city’s median non-senior homestead.

Results: Seven sampled properties faced higher taxes in 2016 than 2011 or 2012, but the differences varied widely, from 3 percent to 24 percent—and one homestead, in East Austin east of U.S. 183, faced 4 percent less in taxes for 2016 than 2012. On average, the taxes levied in 2016 were 11 percent higher than the taxes levied in 2011 and 8 percent up from 2012.

Location mattered. Among the homesteads, the smallest tax differences showed up on suburban properties, the biggest on urban-core homesteads in East Austin and west of MoPac Boulevard, the spreadsheet shows.

Crigler also emailed us a chart showing that by TCAD’s calculations, the $1,137 in city taxes due on a median-value homestead in 2016 was $124 or 12 percent greater than the $1,013 due on a median-value homestead in 2012. Significantly, Crigler said, the 2016 figures take into account the curbing effect on tax bills from state homestead appraised-value limits plus the local homestead tax exemptions approved by the council that year.

So, Austin’s homestead property taxes were almost universally higher in 2016 than five years previous. But for the most part, homeowners weren’t socked as hard as Troxclair's "almost 30 percent" suggests.

Van Eenoo, when we asked, had no quibble with Crigler’s figures.

Michael Searle, Troxclair’s chief of staff, questioned our focus on homesteads rather than single-family dwellings. "I would say that looking only at homesteads gives a narrow picture," Searle emailed.

We tried to check on changes in taxes on median-value single-family dwellings. Van Eenoo said, though, the finance staff did not have a 2016 figure comparable to the 2011-12 budget’s figure. He said the council in 2016 directed it to focus on taxes on homesteads, enabling members to track the effect of the council-adopted increases in homestead tax exemptions.

Family incomes

Next, we turned to Troxclair’s claim about minimal changes in local incomes.

Claiborne and Searle told us city staffers gave Troxclair the figures she relied on to gauge changes in Austin’s median family income.

The provided figures suggest a median family income of $78,671 for 2017—which would be up $3,771, or 5 percent, from the presented median family income in 2011 of $74,900. The projected 2017 figure would be up $2,771, 3.7 percent, from Troxclair’s cited 2012 median family income of $75,900.

Asked about those income figures, the city demographer, Ryan Robinson, told us that he wasn’t familiar with a 2017 projection, but the figures for previous years reflected data covering families in the Austin-Round Rock-San Marcos region, not just Austin, that are annually put together by the U.S Department of Housing and Urban Development. Robinson pointed us to a HUD website where we spotted the median family income figures provided by Troxclair’s office for fiscal 2016 and fiscal 2011 and 2012.

So, median family incomes in the Austin area—extending beyond Austin and Travis County to include Bastrop, Caldwell, Hays and Williamson counties—escalated nearly 4 percent from 2012 to what’s projected for 2017.

But that’s a regional figure. We endeavored to seek Austin-only numbers.

Austin-only income changes

And to our inquiry, a U.S. Census Bureau spokeswoman, Jewel Jordan, pointed us to its estimates of median family incomes in Austin alone, which were based on the bureau’s American Community Survey results for 2011 through 2015.

That research suggests bigger jumps in median family income among Austin residents.

According to the bureau, Austin’s 2015 median family income of $76,629 was up nearly 13 percent from the $68,023 median family income of Austin residents in 2012 and up 20 percent from the $63,672 median family income of Austinites in 2011. In the same years, the number of Austin families escalated from 66,158 in 2011 and 66,474 in 2012 to 73,928 in 2015 (a three-year, 11 percent increase).

Next, we adjusted the dollar figures for inflation:

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Median Family Incomes for Austin in 2015 Dollars

YEAR

AMOUNT

INCREASE/DECREASE ($s)

% CHANGE

% CHANGE from 2012

2011

$67,090

na

na

na

2012

$70,222

$3,132

4.7

na

2013

$72,757

$2,535

3.6

3.6

2014

$76,754

$3,997

5.5

9.3

2015

$76,629

($125)

(0.2)

9.1

na=Not applicable

SOURCES: American FactFinder, American Community Survey, 1-Year Results, 2011-2015, U.S. Census Bureau and CPI Inflation Calculator, Bureau of Labor Statistics  (accessed March 16 and 22, 2017)

For our part, we also wondered if—just as an influx of higher-value housing arguably dampened existing homeowners’ property tax bites—a portion of the indicated family income gains reflected new residents filling new higher-wage jobs rather than workers in Austin at the start of the period soaking up pay gains.

Unfortunately, we didn’t divine a way to figure that out. We noticed otherwise that the Census Bureau’s Austin surveys suggest slightly favorable changes: In 2011, about 26 percent of Austin families had incomes of less than $35,000 while in 2015, that share was down to 21.6 percent. Conversely, in Austin in 2011, 15.8 percent of families had incomes of $150,000 or more while in 2015, 18.8 percent of families were at that level.

Troxclair, informed of the bureau’s city-specific income estimates, didn’t defend her reliance on HUD’s regional figures. She noted that city staff had provided her with the regional figures in response to her request for the "average increase in income in Austin" over recent years.

City staff comments

By email, Van Eenoo, the city’s deputy chief financial officer, confirmed that a colleague had submitted the regional figures to Troxclair’s office without clarifying they weren’t city-only numbers. He further said city staff had calculated the region’s median family income for 2017 by applying the 10-year compound annual growth rate to HUD’s 2016 figure.

Van Eenoo, asked why it makes sense to rely on HUD’s regional estimates, noted they’re more up to date than the bureau’s city-specific estimates. Notably too, Van Eenoo said, the HUD data series is the "official data series used to determine eligibility for a wide range of affordable housing programs. We therefore have often relied on the HUD data series because it is the most current official government data series and tracks with other evaluations of housing affordability, whereas relying on the ACS data would require us to make independent projections of income two years into the future in order to compare income versus current property tax levels."

We sought his comment on the bureau figures showing median family incomes in Austin trailing the regional HUD estimates; Van Eenoo said city staff hadn’t researched that in depth.

Our ruling

Troxclair said: "Since 2012," city of Austin "property taxes have gone up almost 30 percent while incomes have only risen 4 percent."

Both percentages, we found, have flaws enfeebling this admittedly difficult comparison.

In our attempt to be precise, we estimate that city taxes on homesteads in 2016 were up around 8 percent to 11 percent from a few years before with Austin’s median family income in 2015 about 9 percent higher than the city’s median family income in 2012 (though this also almost certainly doesn't reflect income changes for the same specific families).

Upshot: City taxes mostly were up, but largely to a lesser degree than Troxclair suggested. Also, the cited regional income figures reflected lesser gains for families than Austin-only estimates available from the Census Bureau.

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"Since 2012," city of Austin "property taxes have gone up almost 30 percent while incomes have only risen 4 percent."

Ellen Trioxclair

Austin City Council member

Austin, Texas

Thursday, February 23, 2017

02/23/2017

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