PRESENTER: Presenter
Karrie Cook, Budget Manager
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SUBJECT: Title
Discuss and consider approval of the first reading of an ordinance adopting the 2024 ad valorem tax rates.
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DEPARTMENT: Finance
BACKGROUND INFORMATION:
City Council held work sessions on the FY 2025 Budget and tax rates on August 5,6,8, and 12th.
In order for property owners in the State of Texas to be informed of any increases in their property values, truth-in-taxation requirements were embodied in the Texas Constitution and the Tax Code. Taxing units are required to calculate the No New Revenue tax rate and the Voter Approval tax rate after receiving the certified appraisal roll from the chief appraiser.
The No New Revenue tax rate is the total tax rate needed to raise the same amount of property tax revenue from the same properties in both the 2023 tax year and 2024 tax year. The Voter Approval tax rate (VAR) is the highest tax rate the City may adopt before a mandatory election is triggered.
The proposed tax rate of 40.89 cents is remaining consistent with last year. The two components that make up the rate have been modified. The total rate of 40.89 cents is less than the Voter Approval tax rate. The Interest & Sinking (I&S - debt service) portion of the rate totals 20.39 cents while the Operations & Maintenance (O&M - General Fund) portion of the rate totals 20.50 cents. The O&M (General Fund) portion of the rate increases from last year by 0.5 cents. The I&S Rate decreases by 0.5 cents and will still provide sufficient revenue to support debt service payments for all existing and recently approved debt obligations. Following is a summary of the tax rate calculations completed by the Comal County Tax Office.
|
PROPOSED TAX RATE |
$0.408936 PER $100 |
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PRECEDING YEAR'S TAX RATE |
$0.408936 PER $100 |
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No New Revenue TAX RATE |
$0.398163 PER $100 |
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Voter Approval TAX RATE |
$0.418132 PER $100 |
State law requires that a public hearing be held by the governing body before adopting the final tax rate. This hearing will be held on September 5, 2024.
FISCAL IMPACT:
The ad valorem tax revenues generated by the proposed tax rate provide funding for the FY 2025 Budget in the General Fund and Debt Service Fund.
Recommendation
RECOMMENDATION:
Staff recommends approval of the first reading of the tax ordinance for the 2024 ad valorem tax rates.