In a lean budget cycle, Round Rock City Council is now considering a higher tax rate than the one originally proposed in July. At issue: funding for neighborhood street maintenance.

Weighing the options

At a July 21 budget workshop, council discussed a proposed tax rate of $0.429 per $100 valuation and a budget of $418.7 million for fiscal year 2020-21. A new option, presented to council Aug. 11, is a tax rate of $0.439 and a budget of $420.2 million.

Should council pursue the higher tax rate and budget, the $1.5 million increase would double money available for repaving neighborhood streets as well as related repairs to curbs, gutters and sidewalks.

“This money [would go] to core services in the city of Round Rock,” Mayor Craig Morgan said. “This is no new programming, nothing for staff hires, no salary increases.”

At a tax rate of $0.439, the average taxpayer would see an increase of approximately $3 a month on the city portion of their property tax bill, Chief Financial Officer Susan Morgan said.

Neighborhood street maintenance

Since 2012, the city has spent $37.1 million on neighborhood street projects, which include repaving work and repairs to curbs, gutters and sidewalks.

Council ramped up funding to catch up on streets deemed in need of repairs over the past several years—from $1.9 million a year in 2016 to $4.3 million a year in 2019—Transportation Director Gary Hudder said.

“Council has invested tens of millions of dollars trying to get neighborhood streets back to some better conditions,” Hudder said. “I think it’s safe to assume we’re prepared to deal with [a pause in funding], but to keep the same level of commitment that’s been demonstrated in the last several years, we would need to find a way to catch back up.”

The FY 2019-20 budget had designated $4.3 million for neighborhood street maintenance; however, all of those funds were eliminated to balance the budget due to declining revenues associated with COVID-19, Susan Morgan said.

“It’s certainly my opinion that if we delay maintenance, it’s not going to be just inflation we’re dealing with,” Council Member Matt Baker said. “We’d also be dealing with increased maintenance for the repairs that didn’t happen.”

Next steps

Council is expected to set a maximum tax rate Aug. 13. A public hearing is scheduled for Aug. 27, and final adoption is slated for Sept. 10. In addition to participating in the public hearing, Round Rock taxpayers can submit feedback on the tax rate and budget on the city’s website.

“Historically, our council has done a good job of addressing things as they come up,” Baker said. “So, I’m struggling with that a little bit. If we kick this down the road, we’re going to have to deal with it later, and we don’t know what the future holds.”