City manager outlines proposed FY2026 budget, half‑penny tax shift and spending priorities

The City Manager presented the City of Lubbock’s proposed fiscal year 2026 budget in a council work session, describing it as balanced and compliant with state law and the city charter. The presentation included a proposed tax‑rate shift that moves a half‑penny from the interest and sinking (I&S) component to the maintenance and operations (M&O) component, projected changes in sales tax and new property values, proposed compensation adjustments, and a package of capital projects and vehicle purchases. No formal action was taken at the session; the first formal step in the statutory tax process will be the Aug. 12 meeting to propose the maximum tax rate.

Why it matters: the budget sets spending and revenue priorities for city services, public safety pay and staffing, street and utility projects, and user fees that affect households and businesses across Lubbock. Changes in sales tax, new construction values and debt service shape how much the city can fund operations without drawing reserves.

Revenue outlook and the tax‑rate shift The presentation showed a multi‑year decline in the value of new taxable property — from about $796 million in fiscal year 2024 (producing roughly $3.8 million) to an estimated $408 million for the budget under discussion (producing about $1.52 million). The city also budgeted sales tax at $103,000,000 for FY2026, down from the prior year’s budgeted $105,600,000.

To address revenue pressures, the City Manager proposed moving a half‑penny from the I&S rate into M&O. He summarized the proposal using the figures presented: the current M&O rate of 35.7456 pennies and I&S of 11.2664 pennies (total 47.012 pennies) would change under the proposed budget to M&O 37.1779 and I&S 10.7586…