Richardson proposes unchanged tax rate despite projected $6M loss in operating revenue

City Manager Dan Johnson briefed City Council on the proposed budget and tax rate at a Aug. 10 meeting. (Courtesy Citizens Information Television)
City Manager Dan Johnson briefed City Council on the proposed budget and tax rate at a Aug. 10 meeting. (Courtesy Citizens Information Television)

City Manager Dan Johnson briefed City Council on the proposed budget and tax rate at a Aug. 10 meeting. (Courtesy Citizens Information Television)

Richardson is projecting to sustain a nearly $6 million loss in annual operating revenue headed into the upcoming fiscal year.

The city is budgeting about $131 million in general fund revenue for fiscal year 2020-21, said City Manager Dan Johnson, who briefed council on the proposed budget at an Aug. 10 meeting. This is down 4.3% from the current fiscal year, when revenue is estimated to land at roughly $136 million.

This loss is in part due to a dip in citywide property valuations, which staff is proposing not to offset through a property tax increase. Richardson’s estimated appraised value for 2020 is $16.2 billion, which is a 1.81% decrease from 2019.

Instead, the city is proposing to readopt its current rate of $0.62516 per $100 home valuation. By keeping the tax rate the same and applying it to a lower taxable value, the city will collect less property tax revenue in fiscal year 2020-21, Deputy City Manager Don Magner said.

“Rather than revenue going up this year, it actually went down significantly, and rather than going up in our tax rate, we made some very hard cuts, but we are maintaining essential services,” Council Member Steve Mitchell said.


It is possible the city could see a bump in property tax revenue once the tax roll is finalized by the appraisal districts. That action has been delayed due to a postponement of protest hearings. Dallas County’s certified roll is expected in late August, and Collin County’s is slated for mid-September.

A sales tax revenue reduction brought on by the coronavirus pandemic is also exacerbating the city’s loss in operating revenue. Staff projects sales tax receipts to land at $30.7 million for the upcoming fiscal year, which is an estimated annual decrease of $6.3 million, Johnson said.

The city will soften the blow to the budget by borrowing $3.3 million from its fund balance, according to the presentation. It is also proposing to cut general fund expenditures by $3.1 million.

Some of those reductions will include holding off on recommended infrastructure maintenance, implementing a hiring freeze on nonessential positions, suspending compensation increases for staff, and canceling community events.

These expenditures could be incrementally restored if financial trends and forecasts remain positive for a sustained period, Johnson said.

“We want to model the austerity and sacrifice that we know many of our citizens and businesses are facing in their actions,” he said.

Despite the “unique and profound” challenges associated with COVID-19, Johnson said, the city is committed to maintaining essential services that are dependable and useful for a “stressed community,” he said.

This means moving forward on planned improvements to neighborhoods and infrastructure, Johnson said. These projects include park upgrades, street and alley repairs, improvements to traffic software and equipment, and water and sewer projects, among other initiatives.

The city’s water and sewer fund and solid waste fund are expected to see revenue bumps in the upcoming fiscal year. Staff is proposing to keep water and residential solid waste rates unchanged, Johnson said.

Citizens can provide feedback on the proposed budget and tax rate at an Aug. 17 public hearing. Another opportunity for public comment will be available prior to budget adoption Aug. 24.

For more information on the proposed budget, visit this link.
By Olivia Lueckemeyer
Olivia Lueckemeyer graduated in 2013 from Loyola University New Orleans with a degree in journalism. She joined Community Impact Newspaper in October 2016 as reporter for the Southwest Austin edition before her promotion to editor in March 2017. In July 2018 she returned home to the Dallas area and became editor of the Richardson edition.


MOST RECENT

The Plano ISD board of trustees unanimously approved a new, slightly lower tax rate at a Sept. 29 meeting. (Courtesy Fotolia)
Plano ISD trustees adopt slightly lower property tax rate

With this new rate, the average homeowner in Plano will pay $4,894 in property taxes per year, which is down from the average $5,104 paid last fiscal year.

The Emergency Donut Vehicle makes regular visits to local neighborhoods on behalf of Hurts Donut Co. (Courtesy Hurts Donut Co.)
Frisco's Hurts Donut Co. travels to neighborhoods and more DFW news

Read the latest Dallas-Fort Worth business and community news.

Richardson residents and businesses could see a gas rate increase beginning Dec. 1. (Courtesy Adobe Stock)
Richardson residents, businesses could see gas rates go up in December

Despite the increase, home and business owners will save money due to a two-month delay on the effective date of the rate change.

Collin County commissioners update the county subdivision regulations during their Sept. 28 meeting. (Screenshot courtesy Collin County)
Collin County approves updates to subdivision regulations

Collin County commissioners approved updates to the existing county subdivision regulations during their Sept. 28 meeting.

Bavette Grill offers modern American fare, including menu items such as the short rib mac and cheese. (Courtesy Bavette Grill)
Bavette Grill opens in Plano and more DFW news

Read the latest business and community news from the Dallas-Fort Worth area.

The menu consists of meat dishes that are slow-roasted over an open fire. (Courtesy Adobe Stock)
Brazilian Steakhouse coming to Plano and more DFW business and community news from September

Read business and community news from September from Community Impact Newspaper's coverage of the Dallas-Fort Worth area.

The store located at The Patios at the Rail will offer a variety of Texas T-shirts, hats and gear for purchase. (Courtesy Tumbleweed TexStyles)
Tumbleweed TexStyles shop coming soon to Frisco and more DFW news

Read the latest Dallas-Fort Worth business and community news.

Gov. Greg Abbott at a press conference
Gov. Greg Abbott to allocate $171M from CARES Act to help renters at risk of eviction

Gov. Greg Abbott will allocate more than $171 million in renters assistance from the federal coronavirus relief package to eligible Texans.

Harvest Hall will have seven kitchens in total as well as a bar area. (Courtesy LDWW Group)
Grapevine dining hall to host 6 new restaurants and more DFW news

Read the latest business and community news from the Dallas-Fort Worth area.

Richardson had 26 new coronavirus cases from Sept. 18-24. (Community Impact staff)
Dallas County reports 2,588 new cases over weeklong period

There were 26 new coronavirus cases diagnosed in Richardson residents living in the Dallas County portion of the city between Sept. 18-Sept. 24.

Sisters Monica Scott and Monica Frykholm (center) said their team of dedicated staff helped them weather the coronavirus pandemic. (Makenzie Plusnick/Community Impact Newspaper)
Sister-run business Logotology brings custom embroidery, logos to Richardson

The nearly 15-year-old business offers customized products that range from shirts and jackets to kitchen items.

Frisco confirmed two more mosquito pools had tested positive for West Nile virus. (Courtesy Adobe Stock)
West Nile virus found in Frisco and more popular DFW news from the week

Read popular Dallas-Fort Worth news from the past week.