Decatur council adopts FY2026 budget, sets tax rate and approves development- and use-permits

The Decatur City Council voted unanimously Aug. 26 to adopt a balanced fiscal 2026 budget, set the city’s property tax rate and approve a bundle of land‑use and special‑use ordinances.

At a public hearing the council considered the city’s proposed FY2026 budget and the accompanying property-tax rate. Staff presented the same budget material reviewed at the prior meeting and summarized the key figures: total certified taxable value for FY2026 of $1,495,281,000, a proposed property tax rate of 0.565713 per $100 of assessed value (about one penny lower than the prior year's rate of 0.577551), and an increase in projected maintenance-and-operations (M&O) revenue of $471,973. Staff said general fund revenues were budgeted at $17.765 million with expenses projected at $17.764 million; water and sewer and debt service accounts were also addressed in the presentation.

Council voted on multiple ordinances and a resolution in the legislative portion of the meeting: the second reading and adoption of the FY2026 budget ordinance and the city ad valorem tax ordinance; a resolution ratifying the property‑tax revenue increase reflected in the budget; and several zoning and conditional‑use matters, including special‑use permits and a planned‑development text amendment. All formal votes recorded at the meeting were unanimous in favor.

Votes at a glance - Ordinance 20250826 — Adopt FY2026 budget. Motion text (as read at meeting): "I move that we approve Ordinance 20250826 of the City of Decatur adopting a budget for the fiscal year beginning Oct. 1, 2025, and ending Sept. 30, 2026…" Outcome: approved. Vote: Jackson (aye), Hilton (aye), McQuiston (aye), Carpenter (aye), Allen (aye), Reeves (aye). Yes: 6. No: 0. - Ordinance 20250827 — Approve 2025 certified appraisal roll and levy ad valorem tax for 2025 at 0.565713 per $100. Outcome: approved. Vote: Jackson (aye), Hilton (aye), McQuiston (aye), Carpenter (aye), Allen (aye), Reeves (aye). Yes: 6. - Resolution R2025 0822 — Ratify property‑tax revenue increase reflected in budget. Outcome: approved. Vote: Jackson (aye), Hilton (aye), McQuiston (aye), Carpenter (aye), Allen (aye), Reeves (aye). Yes: 6. - SUP250003 / Ordinance 20250828 — Special‑use permit to allow an oversized carport (length >24 ft and height >12 ft and second carport on a legally platted lot). Outcome: approved (motion included language "pending legal approval"). Vote: unanimous. - SUP250004 / Ordinance 20250829 — Special‑use permit for on‑premises sale of alcohol (mixed beverages) in a C1/C1A zone (Pappy Jacks at former Fuzzies location). Outcome: approved (motion amended to include legal approval). Vote: unanimous. - PD250002 / Ordinance 20250830 — Amendment to Paloma Trail planned development (clarifications to allowed exterior materials and storefront/canopy/roofing standards). Outcome: approved (motion included legal approval). Vote: unanimous. - SI2500002 / Ordinance 20250831 — Text amendment to Appendix B (screening, fencing and buffering regulations). Outcome: approved (motion included legal approval). Vote: unanimous.

What council said and asked - Staff explained that the proposed tax rate represents a modest reduction in the combined rate while producing new M&O revenue largely from higher taxable values (+7.5% year over year) and new construction ($17.5 million of new value). Staff reiterated that forecasting was conservative after reducing transfers from the water fund and that the budget includes funding for merit increases and a safety step plan while budgeting for an anticipated ~25% rise in health‑insurance costs. - Councilors asked for clarifications about homestead exemptions and related adjustments; staff confirmed changes include raising certain exemptions (the meeting record noted disability/military/over‑65 homestead exemption adjustments to $30,000 from $25,000). Staff also reviewed sales‑tax assumptions (2.5% growth) and a forecasted combined sales tax of roughly $7 million for FY2026.

What happens next - The budget ordinance and tax ordinance took effect as provided in the adopted texts; staff will proceed with the budget implementation and the technical steps needed to post adopted ordinances and related financial documents. Council directed staff to follow up on signage and other technical needs tied to zoning and public‑safety matters discussed during the meeting.

No litigation, legal challenges or new bond issuances were announced during the meeting. Council members and staff thanked the budget committee and department heads for work on a “lean” FY2026 budget.