Longview officials weigh 6.5% pay plan, possible property-tax increase to cover recurring costs
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Summary
City Manager Roland McPhee told the Longview City Council the city can cover only part of proposed raises without boosting recurring revenue. McPhee proposed a 6.5% across‑the‑board raise plus $500 per employee, and said doing so would require roughly $4.2 million in additional recurring revenue.
City Manager Roland McPhee told the Longview City Council on Thursday that the city is facing constrained revenues and rising costs and laid out a proposal to raise employee pay that would require new recurring revenue.
McPhee said the administration is proposing a 6.5% across‑the‑board pay increase plus a $500 one‑time amount per employee to address recruitment and retention and to move pay toward the council’s policy target of 95% of market. "The money and the dollars represent many people doing and providing services to the citizens," McPhee said.
The proposal would cost an estimated $4,400,000 in recurring annual dollars, McPhee said. The budget team presented roughly $1,800,000 in savings found through cuts — including removing nine unfilled positions and eight fleet vehicles, delaying some technology replacement and cutting nearly all cable service at various facilities — but McPhee said those reductions only covered a fraction of the needed dollars.
McPhee said the council can use "unused increment" in the voter‑approval formula to generate more property tax revenue without requiring an election. He warned that last year the council declined to use available increment and that legislative changes have narrowed local taxing flexibility. "If you raise the property tax rate about a penny, you get about $800,000," McPhee said, describing how much additional revenue small rate changes generate.
Using the administration’s preliminary figures, McPhee said the proposed raise plus $500 would leave the city needing about $4,200,000 in additional recurring revenue. McPhee and staff identified raising the property tax rate as the responsible option to preserve services, while council members repeatedly noted the political and financial tradeoffs for homeowners and renters. McPhee offered a monthly example for homeowners: with Longview’s current average home value cited as $223,311, the raise would equal about a $9.33 monthly increase for an average homeowner under the current projections.
Councilmembers pressed for more detail on the distributional effects and alternatives. Councilmember John Connolly thanked staff for the presentation and emphasized the political sensitivity of raising property taxes, saying that any increase is a "direct hit to constituents." Councilmember Joe Allen asked staff to show how different raise levels would change the tax impact and how hourly workers would see the benefit; staff said the $500 stipend would be converted to an hourly equivalent for part‑time and hourly positions.
McPhee warned the council of longer‑term revenue risk tied to state changes: he said legislative changes to business personal property tax rules could reduce local revenue in FY27 by about $1,600,000. He also said the city is about 14% behind market on average pay, and police and fire pay ranges were about 8% behind a Tyler peer benchmark. Staff projected only modest sales‑tax growth (about 2.5%) in the coming year.
No final decision was made Thursday. The council approved its consent agenda and scheduled further budget work and a special called meeting for July, where staff will return with updated appraisal district values and more detailed options for rate and raise scenarios.
McPhee closed by reminding the council that staff reviewed cuts that would not reduce service and that deeper cuts would begin to affect core services. He said the administration will continue refining numbers for the council’s July review and possible action.
