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Tomball staff outlines revenue assumptions, reserves and insurance pressures in pre‑budget workshop
Summary
City staff presented conservative revenue assumptions — a sales‑tax‑driven general fund, a 6% assessed‑value growth assumption for budgeting, and a 72.5% general‑fund reserve — and warned of a projected 12% jump in employee medical insurance premiums used in early FY26 planning.
City staff presented a high‑level pre‑budget overview on May 5 that laid out the assumptions driving the initial FY26 proposed budget, including conservative assessed‑value growth, sales‑tax volatility and personnel‑cost pressures.
Staff said sales tax remains the single largest revenue source for the general fund (presented as roughly 44% of general‑fund revenues in staff charts) and is the most volatile line item. For budget planning staff used a conservative assessed‑value growth assumption; staff told the council the appraisal district’s preliminary number used for planning was 6%.
Staff reported the general fund reserve at an estimated 72.5% under current projections and said that figure provides flexibility during the budget cycle. On expenditures, staff noted the city’s operating budget is personnel‑heavy and that personnel costs are the primary driver of next year’s pressures.
Health‑care costs: Staff presented a working assumption that medical insurance premiums could increase 12% for the coming year; staff said that figure is based on a rolling 12‑month claims view and could be lower when the old months drop out of the rolling window.
Why it matters: Sales tax volatility, assessed‑value timing and rising fringe costs determine how many supplemental program requests the council can fund without using reserves or increasing the tax rate. Staff emphasized the pre‑budget workshop is meant to guide council priorities rather than present final figures.
Ending: Staff said the team will continue to refine revenue projections as certified numbers arrive and will produce a proposed budget package in July for public hearings and final adoption later in the summer.
