The proposed fiscal year 2020-21 budget for the city of Magnolia is very similar to the previous years, bringing few comments from Magnolia City Council members, said City Administrator Don Doering.
“Basically the budget is very similar to last year’s,” he said. “There have been a few questions asked ... but basically there is no major change in new budget.”
Doering said the only concern was one council member thought a few pieces of equipment could be purchased at a lower price.
As such, the city forewent its annual budget workshop in July. Council members will vote on whether to approve the proposed budget Aug. 11, Doering said. The city's fiscal year begins Oct. 1.
The proposed FY 2020-21 budget includes $3.47 million in general fund revenue, which is a 10.99% increase compared to the previous year’s budget.
Property tax revenue increased 2.42% from the previous year, and sales tax revenue decreased by 0.41% from year to year, budget information shows. However, revenue from franchise, beverage and permits is budget to increase by 92.7% from FY 2019-20.
Expenses have also increased for FY 2020-21, rising 10.42% from the previous year's $3.21 million to $3.44 million.
As such, the city will have a surplus of $21,500 for FY 2020-21, according to the proposed budget.
Doering said strong sales tax allocations throughout the coronavirus pandemic helped prepare this upcoming budget.
Magnolia has seen growth with its sales tax allocations throughout the coronavirus pandemic, with its highest increase of 25.96% year over year coming from May allocations, Community Impact Newspaper previously reported.
“At this point and time we are very fortunate,” Doering said. “We are holding our breath every month to see if we are going to get hit with a lower sales tax, but we have had increases every month.”
A 3% salary increase for all city staff, other than the police department, was also included in the proposed budget.
“We wanted to reward [our staff] for their hard work and dedication,” he said.
However, Doering said a new salary plan for the police department, costing the city $85,000 in the proposed FY 2020-21 budget, will be used to better retain officers.
“We are trying to be competitive with other communities,” he said. “It is hard to keep good officers when you are the lowest-paying employer.”
Magnolia’s property tax rate will likely stay the same—at $0.4645 per $100 valuation—Doering said, but the city is still waiting to hear from the Montgomery County Appraisal District on final property values.
“We are basically projecting the same things for sales tax next year, and that is a conservative number, so we are not modifying the budget because of COVID[-19],” he said.