Agenda

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City Council Regular Meeting

Meeting Date:

08/09/2022

BACKGROUND

On July 26, 2022 the City received the certified property tax rolls from the Guadalupe, Comal, and Bexar appraisal districts. The Guadalupe Tax Assessor-Collector used this information, and information provided by the City of Schertz, to calculate the No-new-revenue and Voter-approval tax rates for the 2022 Tax Year.

The No-new-revenue rate is a calculated rate that would provide the city with about the same amount of revenues it received the year before on properties taxed in both years. The Voter-approval Rate is a calculated maximum rate allowed by law without voter approval. If Council adopts a rate higher than the Voter Approval Rate, the tax rate will automatically be on the November 2022 ballot.

The 2022 No-new-revenue Rate is $0.4526 per $100 of valuation and the 2022 Voter-approval Base Rate is $0.4721 per $100 of valuation. With the prior year unused tax rates, the voter approval rate increases to $0.5094. Staff is recommending a preliminary maximum property tax rate of $0.4999 per $100.

In accordance with Chapter 26.05(d) of the State’s Property Tax Code, a governing body must hold a public hearing on the tax rate if the proposed tax rate exceeds the lower of the No-new-revenue or Voter-approval Tax Rate. In this case, the hearing is required as the proposed rate does exceed the No-new-revenue rate. Staff recommends holding public hearings on August 23^trdand September 6^th and encourages citizen participation and input in the adoption process.

A one-quarter page “Notice of Public Hearing on Tax Increase” must be published in the local newspaper and online in compliance with the Tax Code 26.06. The notice will contain information based upon a preliminary tax rate to be determined by the City Council and the dates of the public hearings.

During the final tax rate adoption process Council can approve a lower rate at that time, however they will not be able to approve a higher rate without republishing the notices and holding additional public hearings.

GOAL

To set a preliminary maximum tax rate for the 2022 Tax Year.

COMMUNITY BENEFIT

Setting a tax rate provides funding for essential services.

SUMMARY OF RECOMMENDED ACTION

Staff recommends council set the preliminary maximum tax rate at $0.4999 and schedule public hearings.

FISCAL IMPACT

The proposed maximum rate maintains quality service to residents and businesses and provides growth in service offerings based on the classification and compensation study, staffing study and City priorities. The current property tax rate is $0.5121 per $100 valuation. The proposed maximum tax rate is $0.4999 per $100 valuation. The M&O portion of the property tax rate will decrease to $0.3519 from $0.3470 per $100 valuation. The I&S portion will decrease to $0.1480 from $0.1651 per $100 valuation. The annual impact on the average home value of $294,800 will be a $139.13 increase in the tax bill or an additional $11.59 in monthly escrow payments.

RECOMMENDATION

Staff recommends Council approve resolution 22-R-82, setting a preliminary tax rate and scheduling public hearings.

Attachments
Resolution 22-R-82