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Leon Valley manager: transfer $32,005 from debt reserve to hold tax rate steady
Summary
City Manager Dr. Caldera told the council staff can transfer $32,005.35 from the debt-service reserve to keep the FY2026–27 tax rate at 0.545040, avoiding a technical 0.003135 increase. Councilors pressed cautions about using reserves repeatedly.
The Leon Valley City Council heard Tuesday that staff can use a small portion of the debt-service reserve to avoid a minute tax-rate increase in the FY2026–27 budget.
City Manager Dr. Caldera told council members: "We're gonna be taking $32,005.35 from your debt service and moving it over to to keep your tax rate the same." She said the change would keep the city tax rate at 0.545040 rather than applying an INS-driven increase of 0.003135 (about one‑tenth of a penny). Dr. Caldera emphasized the transfer is a one-time option and warned councils must monitor the reserve to avoid larger spikes in future years.
Councilors debated the trade-offs. Councilor Campos said staff should look for sustainable options as the city’s tax base grows, but he supported using the reserve now rather than raising the rate. Staff noted the reserve must remain healthy because debt-service timing and interest can fluctuate; Dr. Caldera recommended keeping some money in reserve and watching the account annually.
The discussion produced no formal action at the meeting; staff said the council will see a cleaned-up budget on Aug. 18 with any adjustments reflected ahead of a public hearing and tax-rate adoption schedule.
