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Tomball finance staff report a slight sales-tax dip and $152 million in cash and investments
Summary
Finance staff told the council that sales-tax receipts for Oct'Dec 2025 were down about $130,000 (roughly 2.5%) and that the city held about $152 million in cash and investments at year-end; staff said collections and expenditures are within expected seasonal patterns but warned capital-project drawdowns will reduce reserves over the coming 24 months.
City finance staff presented the quarterly financial and investment reports for the period covering October through December 2025.
Greg (city finance) said sales tax, the city's largest single revenue source, declined about $130,000 (approximately 2.5%) in the first quarter of the fiscal year but cautioned it's premature to declare a trend. Property-tax collections were reported at about $1,380,000 (roughly 10% of the budgeted levy due to the timing of collections), and staff said most property-tax receipts arrive in later quarters.
From an expenditure standpoint, the general fund was at roughly 23'-24% of its annual budget and enterprise funds at about 17'-18% (figures staff characterized as typical for the first quarter). Greg said the city had budgeted conservatively and expected seasonal increases in revenue as warmer months arrive.
On investments, staff reported about $152,000,000 in cash and investments at the end of December, with a sizeable portion represented by bond proceeds for capital projects. Investment pools were yielding just under 4%, and staff said the city retains liquidity by holding short-term balances that can be drawn without penalty. Greg warned that as capital projects ramp up the fund balance will be drawn down and estimated outflows of $2'$3 million per month in coming months related to ongoing projects.
Council members asked about sales-tax origins (destination vs. origin sourcing) and short-term yield assumptions. Staff agreed to provide a trend line for hotel/occupancy tax receipts and to follow up with additional details on youth-diversion fund setup as required by recent legislation. No votes were taken on fiscal items at the March 2 meeting.
