Proposed property tax rates run the gamut



In the next few weeks cities in western Travis County will finalize their budgets for the coming fiscal year. Bee Cave and West Lake Hills are proposing the same property tax rates as fiscal year 2013–14, and Rollingwood is proposing an increase to its rollback rate—the highest tax rate a city can set without calling for an election—to combat rising water costs. Lakeway is proposing a lower property tax rate. Each city will meet in September to set a final budget and property tax rate.



West Lake Hills



For the sixth consecutive year the city of West Lake Hills is ending a fiscal year with a surplus, expecting to finish $800,000 in the black for FY 2013–14. Revenue is estimated to be about $500,000 more than budgeted for FY 2013–14, and the city spent about $300,000 less than anticipated, West Lake Hills Mayor Dave Claunch said. As of September 2013 the city had an estimated general fund balance of nearly $8 million, not counting the cash reserves in the wastewater fund.



For the eighth consecutive year City Council set the proposed property tax rate at $0.0534 per $100 of valuation for FY 2014–15, one of the lowest rates in the state.



The city is able to maintain the low tax rate because West Lake Hills operates largely off sales tax revenue. Of the more than $3.8 million in total estimated tax revenue for FY 2014–15, more than $3 million is from sales tax.



Council has discussed a number of ideas regarding how to spend the excess money from FY 2013–14, including minor road projects, but likely will make a budget amendment during the coming fiscal year, City Administrator Robert Wood said.



"By the time we would have the specifications [for road projects] drawn up and bid it out, we couldn't do it in time," he said. "We can set aside a set number to do projects this fall, however."



Councilman Taylor Holcomb said he would like to see the extra revenue go toward police costs.



The West Lake Hills police and dispatch expenses are about $2 million of the estimated $5.16 million of total expenses for FY 2014–15, or about 40 percent.



Although the proposed budget for the city includes a shortfall of more than $85,000 for FY 2014–15, Claunch said the budget is a starting point.



"I included all the things we talked about including," Claunch told City Council at its Aug. 13 budget hearing. "This isn't the final budget; I know it isn't balanced, but this is the starting place for conversations over the next few weeks."



Rollingwood



Rollingwood Mayor Barry Bone proposed a FY 2014–15 budget at a City Council meeting July 30 with a total estimated shortfall of $297,702. The budget estimates revenue from such departments as the general fund, water and wastewater funds, and streets fund as $3,944,716 with expenses totaling $4,242,418.



The water fund, which has been losing money for the past several years, is estimated to offset its expenses in FY 2014–15 with a 20 percent increase in water rates for all users, which was passed by City Council at a specially called Aug. 11 meeting.



City Council set an increased proposed property tax rate of $0.2443 per $100 of valuation, the highest rate allowed without a rollback election. Council set the proposed rate with the hopes of implementing a homestead exemption to counteract the increased tax burden and potentially lowering water rates with the increased income from commercial property taxes, Alderman Joe Basham said.



"[Raising the property tax rate] gives us the flexibility to make some decisions that may end up being beneficial to residents," Basham said. "It is going to look like our taxes are going up, but we don't need that kind of tax to maintain the spending of the city. We are trying to figure out if there is a way to offset water costs with property taxes."



The city has a net taxable property value of $584,660,229 including $6,646,463 of new value, Bone said.



A large change in the proposed budget from the past fiscal year is the street fund, which estimates expenses at $319,144, or about $90,000 more than FY 2013–14. The city plans to spend more than $140,000 for paying back debt services and street paving. The bond payments will be paid by revenue from the street maintenance tax funds.



"That revenue gives us enough money to make the street payments without having to raise taxes [more]," Bone said.



The street fund also includes $73,674 to be used for street maintenance and repairs, but Bone said the balance could be carried into next fiscal year if not used in FY 2014–15.



Rollingwood City Council plans to adopt the FY 2014–15 budget at its Sept. 17 regular meeting.



Bee Cave



With longtime City Manager Frank Salvato departing for Midland and potentially new administration positions opening, the makeup of Bee Cave's city staff is set to change.



On Aug. 12, Salvato resigned his position—which he has held since 2008—effective Sept. 9. City Council appointed Travis Askey as Interim City Manager effective Sept. 10.



The city's head librarian, Barbara Hathaway, requested the library's two part-time positions be converted into one full-time library clerk at an approximate cost of $44,000.



On Aug. 26, City Council agreed to instead offer a higher wage from $10 per hour to $12 per hour for clerk positions. Council also agreed to convert a municipal court clerk position from part-time to full-time and provide each member with an iPad and paperless agenda software for conducting city business at a cost of $13,000.



The current fiscal year's revenue exceeded expenses, with $510,000 rolling into the city's reserves, Salvato said.



The FY 2014–15 proposed budget revenue is expected to total $10.4 million, and expenditures are expected to tally $9.5 million, he said.



The largest expense request came from the Bee Cave Police Department in the amount of $187,600—including $75,000 for technology, $46,900 for radios, $45,000 for a new patrol car, $7,500 for a speed trailer, $6,600 for a pole mounted speed display, and $6,600 for radar.



City Council declined to approve a major space planning renovation for the City Hall and Library in favor of relocating one or more of the city's departments to a new site in the future.



Bee Cave City Council expected to adopt the proposed budget and tax rate Sept. 9.



Lakeway



Because the average Lakeway home value increased from $393,000 in FY 2013–14 to a projected $423,000 in FY 2014–15, City Council members approved lowering the property tax rate to ensure sufficient funds for government expenses.



The city will have a decrease in revenue in FY 2013–14 as compared to what was budgeted, an event that has only happened once before—in 2008–09—City Manager Steve Jones said.



The shortfall in revenue amounts to a total of about 4 percent, Finance Director Julie Oakley said.



Building development service fees for FY 2013–14 are down about 12 percent from the fiscal year's projected revenue, Jones said. Municipal court fees are also down—about 18 percent—a product of the city taking longer than anticipated to certify its new marshal to generate revenue from collections, he said.



Jones said the increase in property tax collection from higher appraisals and a reduction in the city's expenditures will make up some of the budget's shortfall.



Deputy City Manager Chessie Zimmerman said the Oaks at Lakeway and its anchor grocery store, likely an H-E-B, will bring in additional revenue that was not available for FY 2014–15. She said the H-E-B is going through the city's permitting process to possibly open by summer 2015.



"The [sales tax for] H-E-B will be noticeable—in the $200,000 range," Jones said. "It will be significant for 2016."



Jones said he anticipates adding two members to city of Lakeway staff—a front desk receptionist to be shared with its solid waste department and a police dispatcher. He said he would also like to add an accounting clerk/budget analyst to help the city with its contract requests for a cost of $68,000, including salary and benefits.



Jones projected $233,000 in capital expenses for FY 2014–15, including more than $106,800 for public works—road and drainage projects, an irrigation system along Lohmans Crossing and Lakeway Boulevard, and a street striping machine.



Besides $48,500 in equipment and play and shade structures for Dragon Park, he requested an additional $7,600 in parks expenditures for an aerial work platform.



Councilman Joe Bain moved to lower the property tax rate from 17.48 cents in FY 2013–14 to 17.38 cents per $100 of valuation at the council's Aug. 11 meeting. However, the motion failed, with Mayor Pro Tem Phil Brown and council members Sandy Cox, Jim Powell and Dwight Haley voting against the 17.38 cent rate.



Jones later lowered the proposed tax rate to 17 cents per $100 valuation after learning Lakeway's total taxable property value surpassed $3 billion for the first time. The value increased from $2.8 billion in 2013 to $3.1 billion in 2014.



Lakeway City Council will review the proposed budget for adoption Sept. 29.