Dallas-Fort Worth cities face shrinking revenues and tighter budgets
Add Axios as your preferred source to
see more of our stories on Google.
Illustration: Eniola Odetunde/Axios
Several North Texas cities are tightening their budgets as sales and property tax growth stall.
Why it matters: City budgets pay to maintain streets, employ police officers and firefighters and ensure neighborhoods have access to libraries, recreation centers and parks.
The big picture: Municipal budgets have been boosted in the past few years because of record-high tax revenues from the inflated cost of goods and spikes in property values.
- Long-established cities like Dallas are seeing flattening tax revenues while growing cities like McKinney are still seeing more money even as inflation and property values have leveled.
Friction point: This year's budget season is happening at a time when "conversations about taxation and government services have become more polarized," Arlington city manager Trey Yelverton writes in his city's budget proposal.
- Texas has its own version of the federal DOGE to improve government efficiency and reduce spending of state revenues.
State of play: Some cities are making cuts to offset flattening revenues. For example, Fort Worth's proposed budget relies on cuts of up to 3% to some city departments.
- In Dallas, the proposed budget eliminates or repurposes hundreds of positions to meet a voter-approved measure to hire more police officers.
Yes, but: Several North Texas cities are seeing rising sales tax revenues this year.
- Irving's sales tax revenues are up nearly 8% compared with 2024. Plano's are up almost 9%, according to the state comptroller.
- Plano's 2025-26 proposed budget is $30 million higher than this year's adopted budget.
Catch up quick: Arlington is facing a $20 million shortfall in next fiscal year's budget.
- The city plans to increase the property tax rate, cut operational hours of some departments and raise fees for city services, including the garbage collection rate.
- Denton faced an estimated $14 million deficit, so its proposed budget includes a slight increase to the property tax rate and cuts to city services, including the K9 and after-school programs.
What's next: North Texas cities will be hosting budget meetings over the next month to get community feedback.
- New budgets will go into effect Oct. 1.