Why Mayor Turner is asking to use Rainy Day Fund for Harvey recovery
HOUSTON – In the wake of Hurricane Harvey, Houston Mayor Sylvester Turner has written a letter to Texas Gov. Greg Abbott requesting to use the state's Rainy Day Fund for recovery efforts.
The Rainy Day Fund, officially known as the Texas Economic Stabilization Fund, is estimated to be around $10 billion.
Turner wrote using the fund "is appropriate for (the) response to a natural disaster such as Harvey that wreaked significant damage and caused local governments to incur unanticipated costs far beyond their budgets."
In the letter, Turner said:
- The city of Houston will have to pay around $25 million for its share of debris removal;
- The city is without flood insurance and needs to pay $10 million to extend coverage through the end of the policy in April 2018,
- And the city's insurance policy requires a deductible of $15 million for municipal property damage.
The mayor hopes to keep the emergency hike of property taxes lower by tapping into the Rainy Day Fund.
Turner proposed a property tax increase for 12 months to help the city pay recovery bills. His office said the increase would cost a homeowner an average of $4.03 per month for the year.
“In times like these it’s important to have fiscal responsibility as opposed to financial panic. Listen, the Lt. Governor, the speaker, both agree with me. And that is that Texas will need to tap into the Rainy Day fund. They both agree with me that the appropriate time to do that will be during the next session. They along with the comptroller, all agree with me, and that is we have a full array of tools available to us, to be able to respond to all of our challenges. An easy example is, one of the most important issues right now, is debris removal. And because the city of Houston acted swiftly to begin that process, I was able to swiftly provide them a payment for it of almost $100 million. We have an accelerated reimbursement plan established, where we will reimburse the city for any expenses they have, along the lines of our agreement with FEMA. So that all I need are invoices so I can pay their invoices. I will be paying every city of Houston invoice they submit to us within approximately 10 days. Now that said, I did see the mayor’s letter where he’s asking for certain payments by the state of Texas to the city which are unprecedented, this never happened before in the state of Texas, and it raises a concern that the mayor seems to be using this as hostage to raise taxes, when in reality, the city of Houston is sitting on hundreds of millions of taxpayer dollars that he’s not tapping into. Those hundreds of millions of dollars are siloed in TIRZ programs. Either the mayor could use those hundreds of millions of dollars to pay those expenses that cost a fraction of that, or the state legislature, during the next session, can and will modify the TIRZ statutes to ensure that the reserves, by TIRZ, can be used, by cities, to respond to disasters. So he has all the money that he needs, including the money that I provided to him, including the money that taxpayers have provided to him. He just needs to tap into it,” Abbott said.
Here is a response from the Mayor's office:
"We cannot raid funds that the state has indicated cannot be raided – and which are largely for drainage projects to prevent future flooding anyway. Mayor Turner is asking the governor to do what other governors, such as Florida’s, are doing. It’s the Texas governor’s right to say no."
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