City Council considers budget focused on services, future growth
The Round Rock City Council is considering a $444.7 million budget for fiscal year 2020 focused on delivering high value services, projects and programs intended to meet its strategic priorities in a fast-growing community.
The future-focused budget includes $125 million for general, on-going expenses, $214 million for capital projects like roads and utility infrastructure, and $106 million for all other expenses, like utility and drainage operations and our sports tourism program and facilities. You can find more details on the FY20 budget here.
The City Council met Aug. 8 for an all-day work session on the budget and tax rate proposal. A public hearing and vote on the budget is set for the Thursday, Aug. 22, Council meeting. The first public hearing and vote on the tax rate is Sept. 12. Final adoption is scheduled for Sept. 26.
The General Fund budget, supported by sales tax revenue, property taxes and other fees, includes 10 new employees – six for public safety – and spending necessary to keep up with Round Rock’s growing population.
Sales tax revenue is the largest source of General Fund revenues, at 43 percent. The City collects 2 cents for every $100 spent on purchases by residents, visitors and businesses. Of that 2 cents, 1 cent pays for General Fund services, .5 cent is used to reduce property taxes (see below) and .5 cent funds the Type B Fund to pay for transportation improvements and economic development programs.
Property tax rate proposal
Property taxes make up 35 percent of the General Fund budget.
The proposed property tax rate of 43.9 cents is an increase of 3.9 cents above this year’s effective tax rate of 40.0 cents. The effective tax rate takes into account the 5 percent growth in existing property values from last year. This year’s increase allows the City to fund one-time public safety equipment replacements (.5 cent), debt payments for a five-year road improvement program (1.5 cents) and to keep up with rising operating costs of public safety and city services, including the new employees (1.9 cents).
A Round Rock resident in a median home value of $255,198 would pay $93 a month in City taxes, which is $8.84 more than fiscal year 2019. Property owners can use the City’s property tax calculator to see what their City tax bill would be based on their property value.
The half-cent sales tax for property tax reduction referenced above saves median homeowners $31 a month, or 25 percent, on their monthly tax bill.
No utility rate increase
A scheduled 3.0 percent increase in water rates on Oct. 1 is recommended to be rescinded because the City has saved money by reducing its power costs, improving operations and lowering interest payments by refinancing its debt. The Council had approved in 2017 a three-year program of annual rate increases.
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Source: City of Round Rock