The rate would save residents a minimal amount—about $1—on their tax bill based on the average 2017 Lakeway home property valuation of $472,011, he said. The average 2016 home valuation in Lakeway was $449,923, and the savings accounts for the increase in the average home valuation in the city, he said.
City Council will consider adoption of the FY 2016-17 budget and tax rate at a meeting Sept. 19.
"This [FY 2016-17] is the first time we are actually lowering taxes—going below the effective tax rate," Jones said.
The proposed FY 2016-17 property tax rate is also lower than the FY 2015-16 property tax rate of $0.1700.
According to the Texas Comptroller of Public Accounts, an effective tax rate is the rate that would produce the same amount of tax on the same property—given a variation in valuation—from one year to the next.
The proposed rate is “an anomaly” and a result of an increase in Lakeway’s FY 2015-16 sales tax combined with its FY 2016-17 savings in health insurance coverage for city staffers, Jones said.
“This is not going to happen every year,” Mayor Joe Bain said. “I want to make sure we don’t look at this as an annual [proposal] to decrease taxes and get to nothing. There were anomalies this year that really made a difference.”
Other FY 2016-17 budget proposals discussed during the session include:
- Realigning pay raises for city staff, including police officers, to bring the salaries for Lakeway’s municipal workers up to the range of other Texas cities at a total cost of $464,933;
- Adding new staff positions totaling $357,000 including a full-time administrative assistant; two police lieutenants with equipment and accessories; dispatch supervisor; deputy clerk for six months;
- Receiving a bid for a new healthcare carrier for FY 2016-17 city staff benefits tallies a 4 percent increased cost over FY 2015-16, a budget item that was initially calculated at a 30 percent increase compared to the previous year;
- Accounting for a continued decline in long-term building and development with $1.4 million budgeted for service revenue in FY 2015-16 but only $1.3 million actual; $1.2 million budgeted for FY 2016-17;
- Setting a second public budget hearing for Sept. 12 to discuss solid waste and revenue fund.
