City taxpayers may pay less
The Port Aransas City Council is planning to raise the tax rate, but the hike will be so small that the average resident actually will end up paying less in city taxes than last time around, as a result of property values falling, city officials said.
While hammering out a fiscal year 2010-11 budget over the past few weeks, the council’s goals have included keeping a lid on taxes and making certain budget cuts while at the same time giving raises to city staff, adding at least one police position and buying a new ambulance.
“I believe this is a fiscally responsible budget that includes significant cuts while taking care of our employees and providing improved law enforcement and emergency services for our community,” said Mayor Keith McMullin.
McMullin said the council is trying to keep taxes low as a good-faith effort for taxpayers, who likely will be asked by the council next year to support a bond election that would mean a few million dollars worth of improvements to 11th Street. That would mean a tax hike of 3.3 to 4.6 cents per $100 valuation to pay for the work, said Darla Honea, the city’s finance director.
If the bond issue passes, taxpayers would see the increase in their tax bills in October 2011 or 2012, said Honea said.
The current tax rate is 32.2434 cents per $100 valuation. At a budget workshop on Thursday, July 29, the council voted, 4-2, to advertise a proposed tax rate of 33.2023 cents to fund a variety of city government operations.
State law requires that councils adver- tise the highest possible rate they’re considering before actually adopting the rate. A council still can end up adopting a lower rate, but the panel cannot adopt anything higher than the advertised rate.
The council considered voting to advertise a slightly lower rate: 32.9112 cents. That was the proposed rate that was on the table, as suggested by city staff, going into the meeting that day. However, Councilman Keith Donley suggested going with 33.2023 as the advertised amount, to give them some wiggle room, in case they end up deciding they need to approve something up to that amount to help fund a second new police officer position at the Port Aransas Police Department.
The 32.9112 cent rate was produced with the idea of adding one new officer to the force, not two.
Donley pushed for a second police position to be added to the budget. The city currently has 14 officers’ positions, including the chief’s slot.
Donley said the police department is understaffed, and allowing that to continue could mean that an officer won’t have backup available when he or she is confronted with a violent person.
“I think it’s irresponsible” for the city to allow that, Donley said. “It borders on negligence.”
Adding one officer “will begin working toward having more than one officer on the street for patrol at all times,” Honea and City Manager Robert Bradshaw wrote in a budget briefing to council. “With the current level of staffing, there are times when only one officer is on patrol duty.”
McMullin agreed that the police department has been understaffed for a long time, but he said the council could add another officer without going to the higher tax rate.
Honea said she could find savings in the budget to fund a second new officer’s position with the lower tax rate, but she added that it would be hard to sustain the second position in the 2011-12 fiscal year. Finding the budget savings this year would mean cutting certain needed items, and “you can’t keep delaying those,” Honea said.
McMullin took a council straw poll and found that he and council members Charles Bujan and Glenda Balentine supported sticking with the 32.9112- cent rate, while council members Steve Lanoux, John Price and Donley supported the idea of advertising for the higher rate, for greater flexibility, but still allowing for the possibility of eventually settling on the lower rate.
Councilman Rick Pratt was absent.
Since the straw vote ended up as a tie, McMullin said he would switch his vote to go along with the higher rate in the spirit of compromise and moving the process forward. But he added that he intended to end up later voting for the lower rate, once it comes time to formally adopt a rate.
Donley, Lanoux, Price and McMullin ended up voting yes on a formal motion to advertise the 32.9112-cent rate. Bujan and Balentine voted no.
After the meeting, Bujan said he voted no because he believed the two officers’ positions can be added while still going with a lower rate.
“The staff is telling us they can run the city based on 32.9 (cents),” Bujan said. “Then we come along and increase that by a few pennies here and there, and what we’re really doing is padding it, based upon a contingency we might be able to solve under the 32.9. That’s not the way it should be.”
Price said he voted on the higher amount because council members just received the proposed budget paperwork from city staff Wednesday, and he hadn’t had a chance to digest it.
“I don’t want to box myself into a corner” by voting for the lower rate, when a higher one might be needed, Price said.
The Nueces County Appraisal District has reported that the average market value of a home in Port Aransas this year is $226,507, Honea said. After homestead exemptions and such, the average taxable value of a home here is $199,471, she said.
Last year, the average Port Aransas property owner paid $702.33 in city taxes, Honea said.
Even though both proposed tax rates for the coming fiscal year would be higher than the present one, the average property owner still would end up paying less taxes, because property values have dropped so much, according to Honea, McMullin and other city officials.
If the city’s tax rate ends up being 32.9112 cents per $100 valuation, the average property owner will pay $656.48 in city taxes, Honea said.
If the rate ends up being 33.2023, the property owner will pay $662.29 in city taxes, she said.
Appraised net property values in Port Aransas for the 2009-10 fiscal year total $1,356,302,770. For the 2010-11 fiscal year, it’s $1,276,841,074.
As proposed, the city’s general fund budget for the 2010-11 fiscal year will drop from the current $7,362,351 to $7,257,829 (if the city continues with the plan to add just one officer’s position instead of two), Honea said.
The savings was achieved partly through consolidation of staff positions. The public works director’s position was eliminated. Those duties were absorbed by the deputy city manager’s position.
Additional savings: The city has finished three years worth of payments on a new computer system for the police department. And the budget didn’t include money for a new police vehicle even though it was requested, Honea said.
Tax revenue funding the current budget is expected to total $3,298,690. Other revenue coming from fees, grants and other sources are predicted to be $3,960,127.
City staff drew up the proposed budget to include a number of goals sought by the council. Besides adding a new police officer’s position, those goals include:
• A raise of three to five percent for each city employee. City workers didn’t get pay raises last year.
• Purchase of a new ambulance, valued at about $108,000, that will be paid off in installments.
• Construction of additional phases of the Port Aransas Nature Preserve at Charlie’s Pasture;
• Construction of a fish cleaning station for about $90,000 and haul-out slab for about $65,000 at Dennis Dreyer Municipal Harbor. The project would be funded by grants and a transfer from the Hotel-Motel Special Fund.
• A first payment of $116,880 on a recently purchased fire truck, the largest in the Port Aransas Volunteer Fire Department fleet. The truck cost a total of $924,350.
• An increase of $40,000 to the Port Aransas Chamber of Commerce-Tourist Bureau, which previously received an allotment of $1,067,858 from hotel/motel tax collections, Honea said. The increase is based on an increase in collections of the tax.
• The Facility Fund has .25 percent more hotel-motel money allocated to the fund this year. That means the amount will go from the current $82,143 to a projected $170,071. The fund includes money to repair the Civic Center roof. The Civic Center had repairs done on its foyer roof last year but not on the rest of the building’s roof. About $20,000 is budgeted for general Civic Center and Community Center maintenance.
The council is scheduled to consider the budget again during its next regular meeting, scheduled for 5 p.m. Thursday, Aug. 19, at council chambers, 710 W. Avenue A.
Public hearings on the tax rate are scheduled for 5 p.m. Aug. 23 and 26. The council is expected to vote to set the tax rate and adopt the budget at a meeting that will begin at 5 p.m. Sept. 9.