Updated Sept. 16 at 2:30 p.m.
On Thursday Cedar Park City Council held second readings and public hearings for the proposed budget and the proposed tax rate for the 2016-17 fiscal year, and city staff recommended a few changes to the proposed budget.
City staffers increased the amount of expected revenue in the general fund to $46 million and general fund expenditures to $48.9 million. Assistant Director of Finance Chad Tustison said the proposed budget dropped from $132 million to $131.9 million as a result of the changes.
Tustison reiterated the proposed property tax rate of $0.474 cents per $100 valuation during the meeting. No citizens spoke during either of the public hearings.
Council is expected to approve the final reading and vote to adopt a budget Sept. 22.
Original article, published Sept. 14
Cedar Park City Council is considering a lower tax rate for the 2016-17 fiscal year, though residents will likely see higher property tax bills in 2017.
During an Aug. 25 meeting, city staff proposed a $132 million budget that would add more than a dozen positions, pay for new equipment and includes $30.2 million in voter-approved bond projects.
“We are taking care of the growth that we continue to see, taking care of what we have and also looking at our investments for the future,” City Manager Brenda Eivens said.
City staff proposed lowering the property tax rate to $0.474 cents per $100 valuation for FY 2016-17. The proposed rate is a half-cent less than the FY 2015-16 tax rate of $0.4795 cents per $100.
However, the proposed rate is higher than the effective rate of $0.448887 cents per $100 of property valuation, which is the rate that would generate the same amount of money as the 2015-16 budget.
If City Council adopts the proposed rate, the city would lower its tax rate for the fourth year in a row, Assistant Director of Finance Chad Tustison said.
Cedar Park Mayor Matt Powell suggested looking for additional opportunities to push the rate lower.
“Should that be the council’s decision to set [$0.474] as the max tax rate, it would guarantee for the first time in the city’s history to have four consecutive years of lowering the tax rate, which I think is something to be very proud of,” he said.
With the proposed tax rate, the owner of an average-valued home in Cedar Park could see an increase of $101 in their tax bill. According to city documents, the average home value in Cedar Park has increased by 9.1 percent from 2015-16—from $265,991 to $290,223.
The proposed budget of $132 million is about $8 million more than the FY 2015-16 budget. Tustison said the increase was largely due to higher sales tax revenues and property tax revenues, which are the largest sources of general fund revenue.
The proposed general fund revenue is $45.8 million, and the proposed expenditures is $48.7 million, Tustison said. The city would fund the remaining $2.9 million out of the fund balance, according to city documents.
The proposed budget includes 17 new positions and equipment for the police department and the city’s fifth fire station. It also includes $30.2 million in voter-approved 2015 bond projects, such as the Bell Boulevard Redevelopment Project, the construction of New Hope Road from Cottonwood Creek to Ronald Reagan Boulevard, overlays for road surfaces, and traffic signals and turn lanes throughout the city.
In July the credit rating agency S&P Global raised the city of Cedar Park’s general obligation bond debt rating from an AA rating to an AA+ rating.
Eivens said the upgraded rating allows the city to issue debt and refinance existing debt at a lower interest rate.
The city will hold a public hearing on the budget at 7 p.m., Sept. 15 at Cedar Park City Hall, 450 Cypress Creek Road. Council is expected to approve the final reading and vote to adopt a budget Sept. 22.
