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City staff outlines FY2026 budget assumptions and recommends flat tax rate; Council schedules follow-up
Summary
Staff presented FY2026 budget assumptions and recommended holding the tax rate at $0.2710; Council was asked to consider revising a 4% operating-expense cap and received CIP updates on waterline and road projects. No formal action was taken on the tax rate.
City staff presented key assumptions for the proposed FY2026 budget and discussed the 2025 tax-rate options at the June 17 meeting, calling attention to personnel costs, preliminary tax-roll values, and capital-improvement projects that will influence the city’s fiscal plan.
Finance Director Susan Grass reviewed assumptions for the General, Debt Service, and Utility funds and presented three tax-rate options. City Administrator Gerardo Barrera explained the City’s Financial Management Policy that aims to limit operating expense increases to 4% and recommended Council consider revising that policy to allow greater flexibility to respond to salary and inflationary pressures. Staff recommended maintaining a flat tax rate of $0.2710; preliminary values indicated a 6.35% increase in taxable values, with certified values due July 25, 2025. Council raised no objections; no action was taken at the meeting.
Public Works Director Elvin Hernandez reported on CIP progress: Waterline Replacement Project Phase 1 (Mayerling) is complete; Phase 2 (200 block of Plantation) is 50% through service-connection work and expected to finish by the end of June; Phase 3 (Rhett and Tara) is scheduled to follow. The Bunker Hill Rd. & Taylorcrest Rd. improvement project continues with the black base laid on the northbound lane; weather delays have slowed progress.
The council scheduled a Budget Workshop for July 23, 2025, and staff indicated the next council meeting likely will include contract items for Memorial and Gessner reconstruction design and a water-modeling study.
