Cedar Park council sets maximum tax rate, advances FY2026 budget process

Cedar Park — The Cedar Park City Council on Monday set a proposed maximum tax rate of $0.36 per $100 of taxable value and scheduled two public hearings on the fiscal year 2026 budget, after a detailed presentation from the finance department.

Erica Solis of the finance department told the council the proposed fiscal year 2026 budget totals $215,200,000 and that the general fund portion is $82,900,000. "The proposed fiscal year 2026 budget is $215,200,000," Solis said during her presentation.

Solis outlined how the proposed tax rate is split into maintenance and operations (M&O) and interest and sinking (I&S) components. Staff recommended the voter-approval (M&O) rate included in the proposal of 19.3554¢ per $100 and an I&S rate of 16.6446¢, together producing the overall 36¢ proposed rate. Council approved a motion to set that maximum rate and to hold public hearings on Sept. 4 and Sept. 11, 2025; the motion passed unanimously.

Why it matters: the proposed tax rate and budget determine the level of city services and debt capacity for the coming year. Solis said property tax comprises roughly 40% of the city’s budgeted resources and that the city’s average taxable home value rose from about $511,000 to $541,000, producing an estimated $96 annual increase in the city portion of the tax bill for the average home — about $8 per month.

Key details in the proposal include recurring and one-time investments. The city proposes $5,900,000 in enhancements for 2026 and roughly $1,300,000 in adjustments to base costs. Among personnel changes, the budget includes public safety hires (three firefighters for Fire Station 5, two traffic unit officers and positions intended to support dispatch and case management), recreation and library staff increases, and conversions of some part-time utility positions to full time. Solis said the general fund expenditures proposed for 2026 are $82,800,000 and that the city expects to maintain a fund-balance ratio of about 34% of recurring expenditures, within the city’s 25–50% policy range.

Capital and one-time items discussed include proposed short-term note issuances to fund transportation resurfacing ($10.35 million), police station communications center remodel and fire station improvements ($6 million combined), and $3 million for Millburn Pool work. Staff also proposed issuing $31,350,000 in utility revenue bonds to fund water and wastewater projects, mostly for rehabilitation of aging infrastructure. Solis noted several one-time requests, including $300,000 for a microtransit pilot and a $500,000 placeholder to fund a comprehensive plan update; council members debated whether a full comprehensive plan rewrite is warranted immediately or should be discussed further before committing funds.

Council members asked staff to clarify fund-balance use and to return with additional details; Solis said the proposed use of fund balance for one-time items is about $2.4 million and that the city would remain within its policy targets. Council also discussed an item to pass through credit-card and online transaction fees to customers and asked staff to return with more details.

The council voted unanimously to set the maximum tax rate at 36¢ and to schedule the two public hearings. Staff will present additional budget detail on Aug. 14 and return with final adoption on Sept. 11, 2025.

For reference: the council approved a separate consent agenda earlier in the meeting by unanimous vote.