Leander may drop its property tax rate by $0.01 for fiscal year 2019-20, but residents will likely pay more property tax to the city. Leander City Council voted 5-1 Aug. 22 to set a proposed tax rate of $0.541867 per $100 of taxable value, which is lower than the effective tax rate. Council Member Christine Sederquist opposed, and Council Member Michelle Stephenson was absent. Council will conduct a public hearing of the proposed budget for the upcoming fiscal year and give final approval of the budget and tax rate in September. If the proposed tax rate is approved, this would be the seventh year in a row the city has decreased its tax rate. Breaking down the budget The total amount in Leander’s proposed FY 2019-20 budget is $168,890,850, according to city spokesperson Mike Neu. This amount is a decrease from the current fiscal year’s budget of about $179 million. The decrease is primarily due to changes in several capital projects, according to Neu. For example, Bagdad Road North improvements, which were part of the previous budget, are now complete, and Lakewood Park, which is near complete, has smaller estimated costs associated with it in the upcoming budget. The proposed budget includes 24 new positions in areas such as information technology, public works, planning, police, engineering and code enforcement, which are needed to keep up with the city’s growth, according to a budget proposal Leander’s Finance Director Robert Powers shared with City Council Aug. 15. The city anticipates ending the current fiscal year with a surplus of about $1.9 million, which it is recommending be used to fund capital improvement projects in the next fiscal year, according to Neu. These projects include traffic control improvements, Mason Creek Trail, Fire Station No. 2 and more, according to city documents. Impact on residents The proposed budget includes a reduction in the water reserve charge per living unit equivalent—the unit of measure that represents the quantity of water used and wastewater generated by a single-family detached residence—from $4 to $3. If council ultimately approves, this would be the second consecutive year this rate has been reduced, according to city documents. Home values have increased in Williamson and Travis counties, according to numbers provided by the city of Leander. In FY 2018-19, the average home value was $486,347 for Leander properties in Travis County and $265,234 for Leander properties in Williamson County. For FY 2019-20, the average home value is $507,099 for Leander properties in Travis County and $281,256 for Leander properties in Williamson County. If the proposed decreased tax rate is approved, the average Leander homeowner in Travis County would still pay about $64 more to the city in property taxes in the upcoming fiscal year than in the previous year, and the average Leander homeowner in Williamson County would pay about $60 more. Timeline Two readings of the tax rate are required before it can be adopted, according to Leander’s city charter. They are scheduled for Sept. 5 and 19. Since the proposed rate is not above the effective tax rate, public hearings on the tax rate are not required by state law. The effective tax rate is the tax rate necessary to garner the same amount of property tax revenue for the city from the same properties in the 2018 tax year and 2019 tax year. The budget will also be presented to council Sept. 5 for council to review and discuss. A public hearing for the budget is planned for Sept. 19. The city anticipates the tax rate and budget to be adopted Sept. 19, according to Neu.