City staff outlined a proposed fiscal year 2026 budget for the City of Commerce and said the City Council is proposing a tax rate of $0.83 per $100 of assessed value to cover a shortfall in the general fund.

The proposal, described on the City of Commerce podcast, would increase the city tax rate by 1¢ over the state-calculated “no new revenue” rate of $0.82 and is projected to raise about $85,000 in additional property-tax revenue for the city.

City staff presented why the council put forward the increase: the proposed combined budget is roughly $16,000,000, split about evenly between the general fund and the public utility fund, and the general fund’s public-safety expenditures total about $4,700,000 while property-tax revenue allocated to public safety is about $3,900,000. The staff member explained that property taxes and sales tax together support public-safety services such as police, fire, dispatch and municipal court.

“We have the cost of these services. We’ve got all other forms of revenue… the gap that’s left in expenditures, that is what we have to fill with property tax,” the City staff member said. The staff member also warned that the city does not control property appraisals: “state law forbids us from getting involved in the appraisal process,” and residents who disagree with values must take those concerns to the Hunt County Appraisal District.

Staff described the citywide valuation figures the budget uses: total appraised value inside the city limits is about $1,600,000,000, but about 55% of that value is owned by the State of Texas and is tax-exempt, leaving roughly $690,000,000 in taxable value. The appraisal district reported that about 75% of newly added value came from residential development.

Because much taxable value is residential, staff said the tax burden falls disproportionately on homeowners. Under the proposed rate, the city estimated that every $100,000 of assessed value would raise a homeowner’s city tax bill by $31.69 per year (about $2.64 per month). For the median residential structure valued at $184,000 in Commerce, staff estimated an annual city-tax increase of $58.41, or about $4.88 per month.

Staff laid out what the roughly $85,000 in additional annual revenue would fund within the general fund. Described amounts in the proposal include:

- $66,000 per year to pay for a replacement fire engine and related equipment;
- $70,000 per year for a new public-safety radio system to improve interoperability and replace aging equipment;
- $12,500 per year to support a newly added forensics unit for investigations;
- $48,000 per year to lease the former middle-school gym from Commerce Independent School District and operate a new city recreation center; and
- $37,000 per year for maintenance of four renovated baseball fields at the Eddie Moore Sports Complex.

Staff said those investments are intended to maintain or raise the level of public-safety and quality-of-life services without cutting service levels. The staff member framed the proposed 1¢ increase as a trade-off to avoid service reductions and to enable equipment replacement and new community programs.

The podcast presentation emphasized the mechanics of the tax-rate calculation: appraised value (set by the Hunt County Appraisal District) times the adopted tax rate equals the tax levy; the state provides the “no new revenue” rate that would produce the same levy as last year; and the council may adopt that rate or a different rate to meet the budget. Last year’s city tax rate was $0.79 per $100 valuation, staff said; the appraisal district’s lower total valuation produced a state no-new-revenue rate of $0.82 for FY2026.

No final council action on the FY2026 budget or final adoption of the tax rate was recorded in the podcast. The City staff member said the council is proposing the 83¢ rate as part of the budget process and outlined the items the additional revenue would support; formal adoption would occur through the council’s budget and tax-rate hearings.

The podcast host said a follow-up episode will cover the public-utility fund, which was not addressed in detail in this recording.

The City staff member’s remarks and the figures above reflect the presentation on the City of Commerce podcast; appraisal questions and formal protests should be raised with the Hunt County Appraisal District.