The Kyle Report

The Kyle Report

Thursday, July 26, 2018

City manager to propose $84.9 million budget with no property tax rate increase

I don’t know if there is such a thing as a "quick review" of a 200-page document, but I gave City Manager Scott Sellers’ proposed city budget for the upcoming fiscal year what I would call a "quick review" because spending too long carefully scrutinizing 200 pages of numbers quickly makes my head start spinning, my eyes start rolling and soon the hallucinations begin. I stagger around the abode like some deranged alcoholic following a 30-day bender. It’s not a pretty sight. Someone hand me a bottle of aspirin. Actually, a perfect Manhattan (straight up, not on the rocks) would be even better.

Here’s my overall quick summary — the overall impression I came away with once I began clearing away the spiderwebs in my brain caused by plowing through the document: Sellers is putting a lot of emphasis on improvements to the city’s street and wastewater infrastructure. Streets and wastewater. Those two areas seem to me to be the theme of the budget, the overriding concerns, the points of emphasis. But I’ll know better along with everyone else when Sellers formally presents the document Saturday morning to the city council.

Although the Sellers is seeking to keep the property tax rate at 54.16 cents per $100 valuation, the budget is forecasting a healthy 21.87 percent increase in property tax revenues over the current fiscal year. How much of that comes from an increase in residential property tax evaluations is yet to be known. The certified evaluations are expected from the appraisal district sometime today or tomorrow at the latest.

Accompanying that emphasis I mentioned on wastewater will be a request that the council OK a 10 percent hike in wastewater fees. There’s also going to be a 3.48 percent increase in trash collection charges that’s part of the contract the city has with Texas Disposal Systems.

The budget calls for adding 16 positions to the city’s payroll. The Public Works Department would receive the most new hires — six, including two in street construction. The budget also includes $404,000 for new street maintenance equipment, $200,000 of which would pay for something called an asphalt zipper and $130,000 for a dump truck. Sellers’ requests for new equipment also includes $250,000 for a street sweeper that would be assigned to the Drainage Utility. Parks would get three new employees, two of whom would be for park maintenance.

Sellers’ proposed General Fund budget for overall city operations and maintenance is $23.4 million, an increase of $1,575,770 (7.23 percent) from the current General Fund budget plus a CIP (Capital Improvement Projects) budget of $11.7 million.

Along with the projected 21.87 percent increase in property tax revenues, the budget is projecting a 9.95 percent in sales taxes. That could be a tad optimistic. If the projection of this year’s final tax sales tax collections is correct, it will mean a 5.6 percent increase over what was collected in the previous fiscal year and that was down from a 10.5 percent increase from the year before.

The amount the city collected in Hotel Occupancy Taxes has increased over last year, but not nearly at the amount that was expected. So far the city has collected $241,271 in Hotel Occupancy Taxes this fiscal year and expects to receive $315,000 when the year ends on Sept. 30. However, the current budget projected that final figure was going to be $437,910. Sellers’ proposed budget predicts collecting $320,000 in Hotel Occupancy Taxes during the next fiscal year, 26.92 percent less than what was projected for the current fiscal year. Of course, that number could increase if the city takes action that permits it to collect these taxes from short term rentals, which is already required by state law.

The way I read it, the Engineering Department is the one receiving the largest monetary increase — $1.5 million — over last year with Police receiving the second largest ($841,422) and Public Works the third most ($594,167). In terms of percentages, Community Development’s 16.9 percent increase outpaced all other departments followed by Parks and Recreation (13.34 percent) and Police (12.66 percent).

The budget proposal calls for a $1.80-per-month increase in the residential wastewater fee for those living in the city limits, from $17.99 per month to $19.79. For those outside the city limits, the fee would increase from $24.28 to $26.71. Sewer fees are also targeted for an increase, from $3.48 per 1,000 gallons of water used to $3.83 for those in the city limits and from $4.70 to $5.17 for those outside.

The five-year CIP budget always includes a host of interesting nuggets and the one Sellers’ included in this budget proposal is no exception. Some of the highlights include (all expenses are for 2019 unless otherwise noted):
  • $10 million in 2019 and $7 million in 2020 for the expansion of the wastewater treatment plant that will come from the city issuing Certificates of Obligation. (The CIP also includes $250,000 in 2019 and $100,000 in 2020 for the engineering for the expansion to increase the plant’s capacity from 3 to 4.5 million gallons a day.)
  • $8.18 million in 2019, $10.6 million in 2020, $14.3 million in 2021 and $14.2 million in 2022 for the ARWA water supply.
  • $5 million in 2019 and $3.5 million in 2020 to complete the Lehman Road bond project.
  • $4 million in 2019 and $3 million in 2020 to complete the North Burleson Street bond project
  • $3.8 million in 2019 and $2.6 million in 2020 for the Southside Wastewater Collection System (funded by wastewater impact fees).
  • $2.5 million in 2019 for engineering and $4.5 million in 2020 for construction of North Old Stagecoach, the project Mayor Travis Mitchell revealed during this State of the City address earlier this week.
  • $1 million for Kyle Vista Park
  • $900,000 to complete the Marketplace Extension bond project
  • $800.000 in 2019 and $480,000 in 2020 for Kyle Crossing improvements,
  • $500,000 in each of the next five years for street improvements.
  • $250,000 for the Ash Pavilion Roller Rink.
  • $100,000 to complete the construction of the quiet zones at the Center and South Street railroad crossings

The first public hearing on the proposed budget is scheduled for 7 p.m. Aug. 14 with the second one planned for the same time a week later. An electronic copy of the proposed budget will be posted Monday on the city’s web site and printed copies may be reviewed beginning Monday at City Hall and the Kyle Public Library.

 

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