Cibolo council reviews preliminary FY27 budget, warns voter-approved bonds will raise debt portion of tax rate

CIBOLO — City staff on June 16 presented the Cibolo City Council with preliminary figures for the FY27 general fund that show modestly higher revenues but a projected $1 million shortfall as mandatory costs and capital plans push expenses above current revenue.

Anna Miranda, who led the presentation, said revenue projections rose about $160,000 from $24.9 million to $25.1 million after updated interlocal agreement figures for Guadalupe County (fire services) and Schertz‑Cibolo‑Universal City ISD (SRO services). Miranda said the numbers remain preliminary and staff will refine revenues and department submissions before the next workshop.

“A structurally balanced budget would be where recurring revenues equal recurring expenses,” Miranda said, defining the baseline staff used for analysis and noting the fiscal year runs through Sept. 30.

Staff presented expense drivers that pushed preliminary costs about 4% above FY26 levels. Mandatory increases of roughly $800,000 include market‑adjustment carryover, a projected health‑insurance increase (about $446,000), and interlocal cost increases (about $160,000). In addition, staff identified roughly $245,000 in one‑time requests, including building and parks maintenance, PPE for public safety, and technology replacements.

Council members pressed for line‑item detail on maintenance and PPE requests and whether some costs could be spread across multiple years. Miranda said a facilities and maintenance list is being compiled to prioritize work that could be delayed or funded from another capital program.

The workshop also reviewed how the property tax rate is structured. Miranda explained the tax rate is composed of a maintenance-and-operations (M) component and an interest-and-sinking (INS) component that pays debt service. She said the no‑new‑revenue (NNR) and voter‑approval calculations are set by state rules and the Guadalupe Appraisal District will certify values on July 25.

Council and staff discussed how voter‑approved debt will affect future tax bills. Prop A ($9 million) and Prop B ($17 million), approved by voters in November 2024, will add about 3.16 cents to the INS rate once bonds are issued; staff said those costs will not materially affect the INS rate in FY27 but will affect FY28 and later years. Staff noted some projects supported by certificates of obligation are modeled to keep the INS component at an assumed 18.45 cents; voter‑approved bonds would increase that ceiling.

“Those voter‑approved projects will increase the INS rate because the debt is tied to specific projects,” Miranda said, noting the extra centage was communicated to voters when the propositions passed.

On capital planning, staff presented a five‑year CIP (FY26–FY30) showing roughly $37.75 million of projects and modeled debt issuance where older debt drops off, creating near‑term capacity to issue certificates of obligation. The model relied on assumptions about future property‑value growth; staff cautioned that capacity changes as valuations and planned debt change.

Brian Huggin then led an interactive exercise and displayed infographics designed to show the “fully loaded” cost of adding personnel. Using the materials, staff estimated adding a firefighter costs about $130,000 annually after equipment, PPE and training; a police officer with vehicle and equipment was estimated at about $140,000.

“When we talk about adding a firefighter, the cost is not their salary and benefits at $60,000. It's actually $130,000,” Huggin said, prompting council discussion about staffing shortages. Several council members said the city needs additional firefighters and police officers to staff new facilities and reduce overtime.

Staff also gave an ARPA update. As of April 30, staff reported 96% of ARPA allocations had been expended, with about $893,000 remaining across four projects (the UDC rewrite, asset‑management software, sidewalk funding and the FM78/Shady Meadows water extension); roughly $330,000 of that remainder was shown as encumbered.

Council directed staff to continue refining the general‑fund base budget and bring back updated revenue and expense projections at the next budget workshop on July 21. Miranda said the formal budget package is slated for submission to council on Aug. 11, with adoption required within 10 days of the fiscal‑year start on Oct. 1.

The workshop included a recorded motion to excuse council member Marissa for travel; the motion was made by Miss Brown and seconded by Councilwoman Roberts and was approved on voice vote. A motion to adjourn appears at the close of the session but a formal second or roll‑call was not recorded in the transcript.

What’s next: staff will return July 21 with refined general‑fund projections and additional fund reviews; a public hearing on the budget is expected Aug. 11 and the adopted budget must be in effect by Oct. 1.