The change will reduce revenue to the township by about $300,000 for fiscal year 2023, according to President and General Manager Monique Sharp. The township’s fiscal year is from January to December. Budget meetings are scheduled for the week of Aug. 22 beginning at 8:30 a.m. each day. The board is scheduled to vote on a proposed tax rate Aug. 25.
At the June 22 meeting, board members went over preliminary expectations for upcoming costs. For example, new costs will include the township taking responsibility for The Woodlands Waterway, which will result in additional maintenance costs, Sharp said. Another upcoming need is renovations to several fire department stations, including a rebuild for Station No. 5. Fluctuating costs of materials could affect projections for any building project, board Vice Chair Brucer Rieser said.
"[Inflation] is going to have a significant effect on any construction projects we look at," Rieser said.
Although many properties have seen increased appraisals in 2022, township officials said the amount of revenue that can be collected through taxation is limited by state law. Property tax revenue for maintenance and operations cannot increase by more than 3.5% annually without voter approval, which would be $1.6 million in The Woodlands, officials said. If the township adopts a no-new-revenue tax rate, previously called the effective tax rate, it will receive the same amount of tax revenue as the previous year.
"Property values are going up, but ... my guess is we're going to go down to the effective tax rate," Rieser said.
Discussion and decisions regarding the tax rate will take place in August.
Although the current financial landscape includes higher property values and higher sales tax revenues, it also includes higher costs for materials and other inflationary costs, officials said.
"This may end up being in all my years here my most difficult budget cycle in terms of predicting what's going to happen over the next five years," Sharp said.
