Four city council members are proposing a 5 percent increase in Houston’s property tax rate they say would enable the city to avoid $86 million in spending cuts and bring in enough revenue to cover $40 million in cleanup costs left by the May derecho and Hurricane Beryl.

The increase, pitched by At-Large Councilmembers Sally Alcorn and Leticia Plummer, District H Councilmember Mario Castillo and District I Councilman Joaquin Martinez, is one of two proposed rates on next week’s council agenda.

Mayor John Whitmire is proposing to keep the tax rate at its current level of 51.9 cents per $100 of assessed value.

The rate being pushed by the four council members is 55.2 cents per $100 of assessed value.

The difference between the two proposals for the owner of a home valued at $300,000 with a standard 20 percent homestead exemption is about $78.

RELATED: Will your property taxes go up next year? Use this simple calculator to find out.

The council members placed their proposed rate on the council agenda under the authority of Proposition A. The charter amendment approved by voters last November allows three or more council members to put items directly onto the agenda, a power previously reserved only for the mayor.

Under a 2004 voter-approved revenue cap, the city cannot increase its property tax collections more than 4.5 percent a year. A 2019 state law imposed a cap of 3.5 percent. The city would have to get voter approval to exceed that. The state cap, however, can be lifted to as high as 8 percent during periods of declared disasters.

The council has until Oct. 28 to set the city’s tax rate.

The city recently received a “negative” ratings outlook from S&P Global and Fitch Ratings because of the growing amount of debt service without an increase in revenue. If the companies downgraded the city’s credit rating over the next two years, it could increase the city’s overall borrowing costs.

Whitmire has publicly opposed raising the tax rate without first making cuts to duplication and waste in the budget. He has not announced what those changes may be. 

Alcorn, Plummer, Martinez and Castillo have scheduled a virtual town hall community meeting Sunday to talk about their proposal. Attendees can register online to receive a meeting link and submit questions ahead of the event.

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