UPDATED: Proposed UP Budget Includes 4.89% Tax Rate Increase
Looks like Kent Austin has already done a pretty decent job of correcting my mistake in the comments. Looks like I confused “income” with “budget.” That’s why they call it a cursory reading, I guess:
The proposed tax rate would raise the same amount of tax revenue as last year, not increase the amount by $728,921. This latter amount is the change in the overall proposed budget (a 1.71% increase).
Of the $728,921, fully $445,607 is for the Utility Fund, which is supported by water and sewer charges. The reason: the City’s water treatment provider is increasing its rate by 16% next year, resulting in higher water purchase costs for the City.
I’ll dive into the details a little more for a story next week. From my cursory reading, it looks like the city of University park will cope with a 4.66 percent reduction in its taxable property base by raising the tax rate from $0.26548 per $100 in valuation to $0.27845. That would be the first tax rate increase in the city in 16 years.
The city will raise an additional $728,921 with the increase, which will pay for rising costs in utilities and sanitation and an extra $255,066 in the general fund.
Also included in this year’s budget is a raise for city employees (they didn’t get one last year), and city staffing levels will remain much the same.
The proposed tax rate would raise the same amount of tax revenue as last year, not increase the amount by $728,921. This latter amount is the change in the overall proposed budget (a 1.71% increase).
Of the $728,921, fully $445,607 is for the Utility Fund, which is supported by water and sewer charges. The reason: the City’s water treatment provider is increasing its rate by 16% next year, resulting in higher water purchase costs for the City.
Well, this pretty much shoots the oft-used “the city hasn’t raised rates in a long time”. They finally got caught by declining home prices. Really, is there any reason why the budget would be significantly higher than, say, 1995’s budget? Maybe there is. I’m just asking the question.
Was there any consideration to cutting costs instead of raising rates? How about reducing budgets (like Parks department?).
Why should city employees get a raise? Pretty lame if someone is justifying it by “they didn’t get one last year”.
What are the salaries of the City Manager, Assistant City Manager, and Chief of Police, and how do they compare to other similar-sized cities? ((Note: see Bell, California for what can happen if the citizens don’t know the answer to this last question)).
Annon:
Here are a few more details concenring the City’s proposed budget.
For the last two year period, the City’s General Fund budget has increased less than one percent. During this same time period the Municipal Cost Index has increased 2.5% in each of the past two years. The MCI is a statistic designed to show the specific effects of inflation on the cost of providing city services. It differs from the Consumer Price Index by including elements common to cities, like health care, fuel, construction materials and so on.
A primary objective of the FY2011 proposed budget is to maintain current City services while reducing expenditures wherever possible. The resulting 0.95% increase in the General Fund is testament to that.
Concerning a pay 3% raise for City staff, here is the thought process: Going two years without a raise presents some challenges for the future. If property values are down again next year, which is expected, it will be doubly difficult to fund a raise. Moreover, a modest raise between two years of no raises is preferable to catching up in the third year.
Lastly, employers try to avoid high turnover. It’s not cost-effective. Average employee tenure in University Park is 13.2 years. The City continues to enjoy very low employee turnover, indicating our salaries are competitive with other area cities and private employers.
I agree. Why aren’t we trimming items from the budget first? And giving city employees a raise in this economy? This seems ridiculous
The justification for giving raises is weak. I didn’t get a raise this year either. Yet, I’m happy that I still have a job. I think it’s highly unlikely that UP needs to worry about employees leaving to other cities around the Metroplex given the fact that those cities are certainly not handing out raises either. In fact, Dallas is cutting hundreds of jobs (in addition to all the cuts they already had). I would think there’s a lot of ‘fat’ that could be trimmed before raising taxes.
Concerning the budget and raising taxes … because the decline in single-family homes values is greater than the proposed property tax hike, the average single-family homeowner would pay $31 less than last year.
Anon, jk, & Gagree,
Don’t forget the city LOWERED the city tax rate 14 years in row. Maybe should have left it the same for those 14 years?? Has your HPISD tax bill been lowered any? HPISD is still giving out raises. The city portion of your tax bill is about 14% of your total tax bill.
I agree with Steve and bm. UP has a long track record of fiscal responsibility, and the tax increase is not a big burden. Many of us are on a first-name basis with city employees. We need to support them. A 3% raise over two years isn’t much, but it says a lot about our priorities.
@bm, the first two sentences of my post addresses the “tax rate” argument. For years and years, we have heard that now-stale argument that rates haven’t risen. And now, I see in the newspapers and also here the justification that “because the decline in single-family homes values is greater than the proposed property tax hike, the average single-family homeowner would pay $31 less than last year.”
The fact is, the average homeowner’s tax bill keeps increasing. Period.
Budgets were much easier to manage as long as the DCAD valuation on average homes kept rising. And as long as frozen-senior valuations slowly turned over to mega-mansions valuations. I’ll wager that Mr. Austin is burning lots of the midnight oil now.
Also, @bm, we the people do understand that the majority of our property tax bill comes from funding education. That doesn’t mean we are going to roll over on the other 14%.
Accordingly, it is always incumbent on the citizenry to ask the tough questions.
anon,
It is always incumbent to ask the tough questions, your right about that. Also ask those questions to HPISD, Parkland Hospital, Dallas County College District & Dallas County. Good luck on getting your answers to your first post. The city services we get here are 1st class. The reason people live here is public safety/ police & fire. Alot of people live here with no kids at HPISD or kids in private schools,who could live somewhere different
for alot less money. Try picking up the phone in Dallas and see what you get.