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Plano council sets proposed tax rate ceiling at 44.06¢; budget hearing scheduled ahead of Sept. 8 adoption
Summary
Council voted to publish a proposed property tax ceiling of 44.06¢ — the voter-approval rate including unused increment — and staff presented top-line budget numbers and a schedule for public hearings leading to a Sept. 8 adoption vote.
Plano — The Plano City Council voted to set the proposed tax rate ceiling at 44.06 cents per $100 of assessed value on Monday, a figure the city must publish before final adoption and that represents the voter‑approval rate plus unused increment from prior years.
Karen Rhodes Whitley, budget director, told the council the recommended budget includes total citywide spending of $788 million, a general‑fund total of $412 million and a community investment program (CIP) of $319 million. The recommended tax rate included with the proposed budget was 41.76¢, Whitley said, but the certified tax roll and state calculations produce a no‑new‑revenue rate of 41.94¢ and a voter approval tax rate that, after adding available increment from past years, must be published as 44.06¢.
"A penny on the tax rate equates to about $6.4 million," Whitley said, and she explained the state truth‑in‑taxation rules that require cities to publish the no‑new‑revenue and voter‑approval rates and to hold public hearings when proposed rates exceed certain thresholds. Council must hold a record vote to set the proposed tax rate that will appear in the public notice; it can lower that ceiling before final vote but cannot raise it.
Councilmembers debated whether to publish the maximum rate allowed so they keep options open while finalizing the budget. Several members said they preferred publishing the higher voter‑approval ceiling to avoid having to call a November election. "Most cities do the max at the voter approval rate because they know they're not going to have an election," one council member said during debate. Another member moved — and the council seconded — a motion to publish the voter‑approval rate (44.06¢) as the proposed tax rate.
The city will publish the notice in the Dallas Morning News on Aug. 14 and hold public hearings on the tax rate on Aug. 20, Aug. 25 and the formal public hearing on Sept. 8, when council is scheduled to adopt the budget, CIP and the tax rate. Whitley explained how the different rates would affect the average taxable homestead: under the 41.76¢ rate in the recommended budget, the average homeowner would see an annual increase of roughly $144; under the no‑new‑revenue rate it would be about $193; and under the voter‑approval rate with increment it would be about $248 per year.
Action resulting from the meeting: a motion to set the proposed tax rate at 44.06¢ (voter‑approval rate including available increment), moved and seconded; vote 8‑0; outcome: motion passed. The council may adopt a lower final rate at the Sept. 8 meeting but cannot adopt a higher rate than published.
The budget director also reviewed major revenue and valuation drivers: Plano’s certified taxable market value for 2025‑26 is about $64.6 billion with roughly $650 million in new property value, 89% of which is commercial. The city continues to offer a 20% homestead exemption for residents, Whitley said.
Next steps: staff will publish the required notices and hold the scheduled hearings. Council retained the ability to lower the tax rate during subsequent sessions and when it adopts the final budget on Sept. 8.
