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Lakeway city manager says new budget raises taxes to preserve services and pay bonds
Summary
City Manager Joseph Molis explained the recently adopted budget and the need for a tax increase to cover bond debt and inflation-driven costs, stressing that the change funds parks and transportation projects, pay raises and transparency tools; he highlighted a senior homestead exemption to soften the impact for older residents.
City Manager Joseph Molis told residents the city adopted a budget that includes a tax increase aimed at covering bond debt, rising costs and pay adjustments for staff while preserving services. "We did have to raise taxes," Molis said, adding that the rise reflects both debt (interest and sinking) tied to voter-approved bonds and maintenance-and-operations costs that must keep pace with inflation.
Molis explained that the tax rate is composed of an I&S component (debt service) and an M&O component (operations). He gave an example citizens will recognize: "For every $100 of value of your house, you would pay the city 14¢," and said a typical household will see about a $200-a-year increase (roughly $17 a month) under the adopted rate for a home worth about $880,000. To reduce the burden on older residents, the council voted to double the homestead exemption for residents 65 and older from $25,000 to $50,000; Molis said the change lowers the average increase for qualifying seniors by about $80.
Molis emphasized the budget as a planning tool and a reflection of community priorities, noting staff worked through spring and summer to refine department requests and the council used interactive budget software to test scenarios in real time. He said staff kept the base budget increase to about 1.59% before adding salary and program increases, with the final budget growth around 3.3% once raises and new items were included. "It's our playbook," he said of the budget process.
The presentation is being recorded and will be posted on the city website; residents were encouraged to use an online comprehensive-plan poll to inform future budgeting decisions. The manager invited questions at the end of the session and answered a resident's follow-up about a specific road project.
