Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the Budget Finance topic
No spam. Unsubscribe anytime.
Finance director outlines proposed 2‑cent tax rate cut, revenue stabilization fund and sales‑tax outlook
Summary
Finance Director Tammy Zerman presented the FY 2023‑24 budget framework, including a proposed 2¢ property tax rate reduction to 0.569, creation of a revenue stabilization fund, sales tax projections and use of grants and one‑time funds for capital projects.
Tammy Zerman, Farmers Branch director of finance, presented a budget overview during the July 11 workshop that laid out assumptions, revenue drivers and several policy choices for fiscal year 2023‑24.
Zerman said staff recommends a 2¢ reduction in the property tax rate to a proposed 0.569 per $100 of assessed value. She reviewed the city’s existing exemptions — including a 20% homestead exemption and a $100,000 senior/disabled exemption the city increased last year — and emphasized that school districts and other jurisdictions make up the balance of a typical property tax bill.
The finance director explained the new revenue stabilization fund created at mid year to buffer volatility in sales tax receipts and to protect the city against a potential loss of a large retailer or other revenue shocks; she said the fund helps preserve long‑term reserves and the city’s bond rating. "We set aside money at mid year with a revenue stabilization fund for the potential loss of a large retailer and their sales tax revenue," Zerman said.
On sales tax, Zerman described consultant analysis showing Farmers Branch’s sales tax collections rose strongly over recent years and that staff are using a conservative planning line with a median projection around 4.33% growth. City staff are planning a baseline sales tax projection of roughly $26,000,000 for FY 2023‑24, with a prudent "safe" floor nearer $22–23 million; excess receipts would be directed to the stabilization fund.
Zerman also summarized major grant revenues that have funded capital projects in recent years, including about $11,000,000 from the American Rescue Plan Act (ARPA). She reviewed fund accounting basics, the city’s 15–20% unassigned general fund policy and an aspiration to approach a roughly 90‑day reserve balance for sustained fiscal health.
Council members asked for more detail on the debt roll‑off, the difference between tax rate and taxes owed, and how surplus or one‑time revenue should be used. Mayor Lynn and other council members emphasized the importance of clear public messaging about tax rate changes, debt roll‑offs and one‑time uses of surplus funds.
