Liberty Hill City Council members are weighing a proposed $138 million fiscal year 2026-27 budget that would keep the median property tax bill close to the same amount as the previous year as city leaders work to keep up with explosive growth. Homeowners would see around $1,600 in property taxes for the area’s median home valued at $330,763.
What you need to know
The budget is built around a proposed property tax rate of $0.494268 per $100 of assessed property value. That’s an increase over the previous property tax rate of $0.469407 per $100 valuation.
In spite of the proposed increase in the property tax rate, the projected median property tax bill will decrease by about $6 from last year's, according to city documents. Additionally, there is an almost $20,000 decrease in the median taxable property value in Liberty Hill, city documents show.
A tax rate increase is necessary for city services and infrastructure to keep up with the city’s rapid growth, Finance Director Josh Armstrong said.
“Cutting the rate any lower than what we [have proposed] would be like shooting yourself in the foot before a marathon,” Armstrong said at an Aug. 12 City Council meeting.
City Council members are set to vote on the proposed budget and tax rate following a public hearing Sept. 9.
The big picture
The $138 million in expenses included in the budget is split between $59 million in operations costs and $79 million in capital projects.
The city is making a large investment in capital projects so that its water, roads and other infrastructure can catch up to the growth Liberty Hill has seen in recent years and be prepared for future growth, City Manager Thomas Hunter said.
The population of Liberty Hill grew from about 3,500 in 2020 to more than 13,000 by the end of 2025, according to U.S. Census Bureau data.
City officials plan to use money previously set aside for capital projects that did not move forward to fund future infrastructure improvements, Hunter said.
The budget is centered around four key strategic goals set forth by City Council, city staff said:
- Transform downtown into a vibrant community-centered destination
- Lead in sustainable infrastructure and water innovation
- Advance regional mobility and connectivity
- Strengthen community trust and organizational excellence
“I would say for the first time in a little while, we've got a direction where we can take every single line item, we can take every single project, and we can tie it directly back to the strategic goals and priorities that this council set,” Hunter said.
