What is Proposition Q?
Austin's Proposition Q (Prop Q) is a city tax rate election (TRE) on the November 4, 2025 ballot that would approve an ad valorem tax rate of $0.574017 per $100 valuation in the City of Austin for the current year.
If passed, Proposition Q is projected to generate between $100 million and $110 million in additional annual revenue for the City of Austin.
Why is Prop Q on the Ballot?
The Austin City Council voted and adopted a $6.3 billion budget for fiscal year 2025-2026, which includes a $33.4 million deficit — meaning projected revenues fall short of planned expenditures by that amount.
To close this funding gap and fund expanded city services, the Austin City Council voted in August to set a property tax rate high enough to generate approximately $110 million in new revenue.
However, under Texas law, cities cannot raise property taxes more than 3.5% without triggering a voter election.
The proposed rate of $0.574017 is $0.05 (5 cents) higher per $100 valuation than the state-mandated “voter-approval tax rate,” which is over the 3.5% increase in property taxes. Prop Q’s proposed rate is also $0.096417 higher than the prior year's rate of $0.4776, representing a 20.2% increase in the city's tax rate itself.
Where Would the $100+ Million Go?
Budget Allocation Overview
City budget documents lay out the uses of the additional revenue. Here’s a basic overview:
Category | Allocation | Specific Programs |
Homelessness Services | $51.5 million | Emergency shelters, rapid rehousing, case management, and permanent supportive housing |
Housing Affordability | $15.5 million | Local vouchers, landlord engagement, and more supportive housing |
Parks & Recreation | $5.9-8.2 million | Maintenance, land management, wildfire mitigation |
Public Safety | Varies | 62 new EMS positions, expanded mental health crisis teams, 911 responders, and firefighter overtime |
Public Health | Varies | Sobering Center ($1M), domestic violence shelters, Family Justice Center |
Other Services | Varies | Libraries, pools, animal services |
Ballot Language Controversy
The ballot language and the framing of the increase (comparing the voter-approval rate to the year-over-year comparison) are central points of contention among many Austinites. It has even led to a lawsuit, which the Texas Supreme Court declined to hear, allowing the current language to proceed.
Here is the complete ballot language:
Proposition Q: THIS IS A TAX INCREASE Approving the ad valorem tax rate of $0.574017 per $100 valuation in the City of Austin for the current year, a rate that is $0.05 higher per $100 valuation than the voter-approval tax rate of the City of Austin, for the purpose of funding or expanding programs intended to increase housing affordability and reduce homelessness; improve parks and recreation facilities and services; enhance public health services and public safety; ensure financial stability; and provide for other general fund maintenance and operation expenditures included in the fiscal year 2025-2026 budget as approved or amended by City Council. Last year, the ad valorem tax rate in the City of Austin was $0.4776 per $100 valuation.
Important note: A critical and often misunderstood aspect of a TRE is the long-term consequences of its approval. The change is not a one-time levy or a temporary increase for a single budget cycle.
If voters approve Proposition Q, the $0.574017 rate will be the new baseline for calculating future tax rates and revenue caps. This means that in the following years, the 3.5% cap will be based on this increased starting point, effectively compounding the tax increase over time.
What’s the Financial Impact on Austin Homeowners?
Tax Rate Increase Breakdown
Metric | 2024-25 Rate | Prop Q 2025-26 Rate (Fails) | Prop Q 2025-26 Rate (Passes) |
Tax Rate Per $100 | $0.4776 | $0.524017 | $0.574017 |
Increase rom 2024-25 | N/A | $0.046417 (~4.64¢) | $0.096417 (~9.64¢) |
Percentage Increase | N/A | ~9.7% | ~20.2% |
What This Means for Homeowners
If Prop Q FAILS, the city can still raise taxes to the voter-approval rate threshold.
If Prop Q PASSES, a person who owns property worth around $500,000 would see an increase of $482 on the city's portion of their annual property tax bill. Approximately $250 would come from the 5-cent TRE.
Home Value | Annual Increase (NO Prop Q) | Annual Increase (WITH Prop Q) | Annual Additional Cost of Prop Q |
$300,000 | ~$139 | ~$289 | ~$150 |
$500,000 | ~$232 | ~$482 | ~$250 |
$700,000 | ~$325 | ~$675 | ~$350 |
$900,000 | ~$418 | ~$868 | ~$450 |
* Notes: Calculations are based on the city portion of the tax bill only and do not include tax rates from Travis County, Austin ISD, Central Health, or any other taxing entity. The actual tax liability will vary based on a property's specific taxable value after all applicable exemptions, such as the homestead, senior, or disabled persons exemptions, are applied.
What Is Prop Q’s Expected Impact on Renters and Small Businesses?
Impact on Renters
For the nearly 46% of Austin residents who rent their homes, the tax increase will likely manifest as higher monthly rental payments.
Opponents of Proposition Q, including Ed Latson of Opportunity Austin, estimate that the average renter could see their annual cost of living increase by more than $200 as a direct result of this pass-through effect.
Impact on Small Businesses and Commercial Properties:
Commercial properties are likely to face a more direct and unmitigated impact from the tax rate increase.
Unlike residential properties, commercial properties are not eligible for Texas homestead exemptions or the 10% annual cap, meaning they’re taxed on 100% of their appraised value, unless they’re capped via the 20% circuit breaker.
For small businesses, many of which operate on thin margins, a rise in property taxes — whether paid directly or via leases — increases their operating costs.
Key Dates
October 6, 2025: Last day to register to vote
October 20-31, 2025: Early voting period
October 24, 2025: Last day to apply for a mail-in ballot
November 4, 2025: Election Day
You can find exact times and polling locations on the Travis County Clerk election page.
FAQs Around Austin’s Prop Q
1. How much will my property taxes increase if Prop Q passes?
For a $500,000 home, expect approximately $300 more per year ($25/month) on the city portion of your tax bill.
2. Is this a one-time or permanent tax increase?
This is a permanent increase. The new rate becomes the baseline for all future tax calculations.
3: Will this affect my homestead exemption?
No. This rate increase applies to all properties, regardless of exemptions. However, the Texas homestead exemption is likely to increase from $100,000 to $140,000 and $110,000 to $200,000 for seniors and disabled homeowners.
4. What's the primary purpose of the $110 million?
Approximately $51.5 million goes to homelessness services, with the remainder funding housing, parks, public safety, and other city services.
Protect Your Property Tax Bill: Appeal Your 2026 Assessment
Whether Proposition Q passes or fails, Austin property owners will face higher property taxes in 2026. The best way to manage your property tax burden is to ensure your property isn't over-assessed.
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Don't wait until your 2026 property tax bill arrives. Start planning your protest strategy now and ensure you're not overpaying — especially with potential rate increases on the horizon.
