Title
Consider an ordinance setting a tax rate of $0.6573 per $100 valuation, comprised of $0.5107 for maintenance and operations and $0.1466 for debt service, for fiscal year 2025 (tax year 2024).
Body
DATE: September 3, 2024
TO: Kent Cagle, City Manager
FROM: Judith Tangalin, Executive Director of Finance
SUBJECT: Setting the Tax Rate for Fiscal Year 2025
BACKGROUND AND FINDINGS:
A public hearing required by Section 26.05 of the Property Tax Code may not be held before the fifth day after the date the notice of public hearing is given. The notice required by Property Tax Code 26.06 was published in the Killeen Daily Herald on Sunday, August 11, 2024 after which two typo errors were discovered. A corrected notice was then published on Tuesday, August 13, 2024 and Sunday, August 18, 2024.
The City has complied with all provisions of the truth-in-taxation laws regarding the adoption of the tax rate.
The City Manager's proposed FY 2025 Budget used the tax rate of $0.6573 per $100 valuation. On August 6, 2024, at a City Council meeting, the Killeen City Council set the preliminary tax rate at the rate of $0.6573 per $100 valuation. The preliminary tax rate represents the maximum rate that can be adopted for the FY 2025 Budget. The no-new-revenue tax rate for FY 2025 (2024 tax year) is $0.5996. The voter-approval tax rate for FY 2025 (2024 tax year) is $0.7114.
Texas Tax Code requires the vote on an ordinance setting a tax rate that exceeds the no-new-revenue rate to be a record vote and approved by at least sixty (60) percent of the members of the governing body. In order to set the tax rate above the no-new-revenue rate of $0.5996, the ordinance must be approved by at least five (5) members of City Council.
THE ALTERNATIVES CONSIDERED:
1) Set the tax rate for fiscal year 2025 (tax year 2024).
Which alternative is recommended? Why?
Set the tax rate at $0.6573 per $100 valuation as presented in the ordinance.
CONFORMITY TO CITY POLICY:
The ordinance complies with truth-in taxation laws set by the Texas Tax Code and Local Government Code.
FINANCIAL IMPACT:
What is the amount of the revenue/expenditure in the current fiscal year? For future years?
N/A
Is this a one-time or recurring revenue/expenditure?
N/A
Is this revenue/expenditure budgeted?
N/A
If not, where will the money come from?
N/A
Is there a sufficient amount in the budgeted line-item for this revenue/expenditure?
N/A
RECOMMENDATION:
City Council approve the ordinance setting a tax rate of $0.6573 per $100 valuation, comprised of $0.5107 for maintenance and operations and $0.1466 for debt service, for fiscal year 2025 (tax year 2024).
DEPARTMENTAL CLEARANCES:
Finance
Legal
ATTACHED SUPPORTING DOCUMENTS:
Ordinance
Presentation