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Council begins FY2026–27 budget work session with revenue outlook
Summary
City Manager Christopher Duke presented preliminary revenue projections for FY2026–27, citing a projected $27,000 decline in property-tax revenue, sales-tax expectations near $1.7 million, municipal court revenue near $750,000, and a draft general-fund total around $8.693 million; staff noted uncertainty and plans for a five-year spread next week.
On June 9 the Castle Hills City Council conducted the first FY2026–27 budget work session, with City Manager Christopher Duke reviewing preliminary general-fund revenue projections.
Duke said property-tax revenue is expected to decline by about $27,000 because appraisal increases were offset by larger exemptions and a state pilot program cap that moved from about $2.7 million to over $8.7 million in exemptions. "We are estimating that we'll see a decrease in general fund property tax revenues approximately $27,000," he said.
On sales tax, Duke said last year was the city's strongest collection year at about $1.8 million. Staff projected using $1.7 million for next year given signs of a slowing economy. Municipal-court receipts were projected around $750,000; permits, franchise fees, and solid-waste fees were discussed as other meaningful revenue lines. Duke said the draft total revenue for the general fund currently stood around $8,693,361.
Duke cautioned that protests at the appraisal district remain ongoing and that many lines remain uncertain. Staff plans to present a five-year spread for council review in the next workshop and to revisit permit-fee structure and other potential revenue discussions.
Council scheduled follow-up budget workshops to refine assumptions and address potential tax-rate and fee decisions needed to support proposed service levels.
