No action was taken. Council will vote to adopt the budget at the Sept. 1 meeting, and the final reading and adoption of the tax rate will be Sept. 15.
During the last meeting Aug. 4, council voted to propose a maximum ad valorem tax rate—or the tax rate based on property values—of $0.455262. This will equate to a decrease of $0.024437 from the current tax rate of $0.479699.
The ad valorem rate has two components, the maintenance and operations tax rate at $0.272325, and the debt rate at $0.182937.
If the city adopts the tax rate as proposed, it will generate an additional $750,000 in property tax revenue.
The city’s proposed operating budget of $329.3 million for fiscal year 2022-23 is up from the adopted budget of $213 million for fiscal year 2021-22. One of the biggest increases for the proposed budget is in the general fund, which is up 14% from the adopted budget in 2021-22.
The biggest current expenses for the proposed general fund are nondepartmental expenses—such as solid waste collection—police and fire.
In total, property taxes, sales taxes and development-related fees account for 80% of the general fund revenue estimate for fiscal year 2022-23.
Executive Finance Director Robert G. Powers said the proposed operating budget has eight primary funds:
- a general fund of $67.78 million;
- a golf fund of $1.79 million;
- a utility fund of $51.26 million;
- general capital project funds of $54.58 million;
- utility capital project funds of $116.19 million;
- special revenue funds of $16.1 million;
- internal service funds of $2.26 million; and
- a general debt service fund of $19.34 million.
For fiscal year 2021-22 the average Leander home value was $361,577; with a rate of $0.479699, the average tax bill to the city was $1,734.48.
This year, the average homestead value is $417,571; however, state law limits residential homestead increases in their taxable value to 10%, according to Powers. In other words, homes may go up 50% on market value, but can only go up 10% in taxable value.
Therefore, if a homestead was worth $361,577 in FY 2021-22, then the property can only be taxed at $397,734.70 in FY 2022-23. With the new proposed tax rate, the average homeowner’s tax bill will be $1,810.73, an increase of $76.25 over last year.
The city of Leander offers a tax freeze for residents with disabilities and residents over the age of 65. For individuals in these groups, property taxes can go down, but they can never go up and are frozen at around 1% of the property value.