Galveston no-new-revenue tax rate

Why Galveston Can’t Afford This “No-New-Revenue” Rate

 

The mayor’s office feels busy even when it’s quiet. Papers on the desk, messages blinking on the phone, another meeting coming up at 11:30. Craig Brown is always on the go, but when I sit down with him, as always, his attention is focused on the real solutions to difficult issues. As the subject turns to the budget—and specifically the no-new-revenue tax rate—he stops, settles back, and gives me the kind of straight talk that only comes from someone as politically brave as Craig.

“No new revenue doesn’t cause a major disruption at one time,” he says, his voice measured. “It chips away constantly at your ability to provide quality service for our residents. And that’s where, in my opinion, we are at this particular point in time.”

That word—chip—hangs in the air. Because the cuts aren’t dramatic. They’re invisible at first. But they add up.

 

A Question of Pennies—or Protection

For most Galveston homeowners, the difference between the no-new-revenue rate and the city’s adopted budget amounts to less than $75 a year. That’s it. One dinner out.

But those pennies, multiplied across the tax base, fund the essentials. The fire station that can house trucks big enough to fight blazes in mid-rise condos. The overtime shifts that keep police on 61st Street when cruise traffic clogs the island. The drainage projects that decide whether your street floods during the next heavy rain.

The city’s contractual commitments such as those to first responders remain fixed, but adopting a no-new-revenue rate leaves little flexibility to fully meet those obligations or cover other rising expenses.

That’s the hidden cost. It’s not whether you save $75. It’s whether the firefighter who shows up at your door has the right support, the right team, and the right truck to do the job.

 

The Reserve Fund: Galveston’s Oxygen

For years, Galveston has taken pride in its 120-day reserve fund. It’s more than a bragging point with Wall Street. It’s the city’s oxygen tank—the money it breathes in those first critical weeks after a hurricane, long before FEMA checks arrive, and one of the reasons the city has an AA+ bond rating, one of the highest you can receive.

The no-new-revenue rate cuts that cushion by 11 days. Eleven days may not sound like much, but in a crisis it’s the difference between being ready and being desperate.

“It’s not if we have a catastrophe, it’s going to be when,” Brown says. “And we financially need to be prepared.”

What makes this more urgent is what’s happening in Washington. FEMA’s reimbursement formulas are shifting. The city used to front 10% of recovery costs. Now it’s 20%. Federal officials are already hinting that local governments will have to carry this load now, and that could mean even higher risks of unreimbursed repairs.

Cutting reserves today, in that context, is like canceling your insurance because you didn’t file a claim last year.

 

Infrastructure and the Fire Station Trade-off

Everyone agrees Galveston needs a new Fire Station 2. The bond issue enjoys wide support. But here’s the catch: without new revenue, the city must raid its infrastructure fund to pay the debt.

“You may fund a fire station,” Brown warns, “but you don’t have money to repair the potholes and streets and drainage. That’s the trade-off.”

It’s a quiet trade. Residents won’t notice in the first month. But a year later, when the potholes multiply and drainage projects fall behind, they’ll feel it in ways far more disruptive than an extra $75 on a tax bill.

 

The Business Analogy

Think of the city as a business. Costs rise every year—supplies, payroll, insurance. If a law forces you to charge last year’s prices, you don’t become more efficient. You cut corners until quality breaks.

“Every time you establish a tax rate, that becomes your base rate,” Brown explains. “If you maintain a no-new-revenue rate, it causes cities to move in a direction of decreased funding year after year compared to what their cost of doing business is.”

That’s not living within your means. That’s starving the engine until it seizes.

 

What Gets Cut First

The city manager won’t gut the police force tomorrow. The fire department won’t shut down next week. Instead, the cuts creep in:

• A patrol car kept in service too long.
• A drainage project delayed another cycle.
• A fire truck that can’t fit in an outdated station.
• Vacancies left unfilled until morale starts to slip.

Brown captures it best: “You’ll basically wake up one day and go, ‘This is not the quality that I remember Galveston can provide.’”

 

Growth Without Capacity Is a Mirage

This debate comes as Galveston faces opportunity on a scale not seen in decades. A billion-dollar Davie shipyard on Pelican Island could anchor thousands of jobs. Cruise terminals are expanding. New condos and hotels rise on both ends of the island.

But growth creates costs first—traffic, EMS calls, infrastructure stress—long before the revenue flows in. If Galveston can’t fund its basics, opportunity risks turning into overload.

 

Majority Rule vs. Minority Veto

The strangest part of all this? A minority of council members can impose it. Two people out of seven, just 28.57%, can overrule the majority on the most important decision of the year.

Brown shared his honest thoughts on this: “There needs to be a re-evaluation of the tax cap. One size doesn’t fit all. Galveston has concerns that other cities don’t have—and vice versa. The system shouldn’t be so punitive.”

That’s not democracy. That’s minority rule baked into law.

 

The Real Choice

So here’s the story:

• You can save less than $75 this year.
• Or you can fund the people who keep you safe, the reserves that keep you alive after a storm, and the infrastructure that keeps the city running.

That’s the choice.

For Brown, it’s about telling residents the truth, even when it’s not popular. “Look at your personal budgets,” he says. “If someone told you, ‘You cannot receive any more revenue than you had last year,’ while your costs are going up—bread, milk, insurance—you’d see that your cost of living is going up while your income stays the same. That’s exactly what no-new-revenue means for the city.”

 

The Bottom Line

This isn’t about whether you like taxes. It’s about whether Galveston works—on a Tuesday night when your family needs an ambulance, on a Saturday when the causeway clogs with tourists, and on the morning after a storm when the city must stand back up.

For less than $75 a year, we can keep Galveston safe, competitive, and ready. Or we can handcuff ourselves with a slogan and let 28.57% of council chip away at the foundation of the city we all depend on.

Because when a minority calls the shots, the math doesn’t just look bad, it endangers the future.