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On the first of two readings, the San Marcos City Council has considered a budget ordinance for the upcoming fiscal year.
Ordinance 2019-25 adopts a budget of $239,058,970 for the upcoming year, beginning on Oct. 1, 2019, and ending Sept. 30, 2020. The second reading and public hearing for the proposed budget will be held on Sept. 17, and if adopted, the budget will go into effect in October.
Melissa Neel, assistant director of finance, gave a presentation on the budget and said economic development funds were utilized for special projects to support strategic initiatives.
“Meet and confer was re-negotiated this year to cover our civil service contracts…” Neel said. “For our non-civil servants, the Merit, COLA, and health insurance adjustments are included in the budget.”
The proposed budget will maintain the current tax rate of 61.39 cents on each $100 of taxable value of real property that is not exempt from taxation, as well as maintain a 25% fund balance.
Neel said the tax rate is 7.9% higher than the effective tax rate of 56.86 cents.
“The effective tax rate is effectively the rate that generates the same amount of revenue on the same properties as last year’s tax year,” she said. “The tax rate of 61.39 cents will generate 11.7% more revenue than last year, or $3.6 million, and of that, $815,000 was from new properties.”
According to Neel, the tax rate per $100 increased in FY2018 to 61.39 from FY2017, when the rate was 53.02. Since FY2018, the tax rate of 61.39 has been maintained.
“The jump from (FY)17 to (FY)18 was as a result of a voter-approved bond issue,” said Mayor Jane Hughson.
Total appraisals went from $4,070 million in FY2017 to $5,644 million in FY20, according to Neel’s presentation.
Revenue for the proposed budget is $239.8 million — an increase of $12.6 million or 5.5% from the previous year. Neel said the increase is primarily due to base sales tax and outlet mall revenue, property tax revenue due to increased total appraised value, new construction and growth in utilities.
The proposed budget will bring a $9.7 million increase in expenditures over last year’s budget.
“Increase is primarily due to the cost for merit increases, and health insurance and new positions. We also included increases for … contracts for services and software, this also includes increased economic development incentive payments due to increased valuation and sales tax collections.”
Council also held a public hearing on an ordinance that will increase rates for water and wastewater treatment. Council voted unanimously to pass the ordinance, which raises water rates by 5% and wastewater rates by 3%, on the first of two readings. A second reading on the ordinance is scheduled for Sept. 17.
“Our water rate adjustments increased 5%, where our wastewater rates increased 3%,” said Neel during her presentation. “This increase will impact the average residential customer annually of $47.44 and $3.95 monthly. The additional expenditures added for water/wastewater include a new crew in our water distribution maintenance area, $79,000 in operating and $525,000 for equipment and items under capital outlay.”
In other business, council voted to approve a resolution adopting My Historic SMTX, the city’s Historic Resources Survey.
The survey began in 2018, and over 2,000 properties were inventoried. The survey was funded in part by a 2018 Certified Local Government grant from the Texas Historical Commission. The last time a historic resource survey was conducted in San Marcos was in 1997.
