The University Park City Council last week approved an ordinance adopting the fiscal year 2021 budget, as well as an ordinance levying the fiscal year 2021 property tax rate.
The ordinance set the fiscal year 2021 property tax rate at 26.4750 cents per $100 of taxable value, which is effectively a 3.61% increase in the tax rate.
The city council also approved ratifying the fiscal year 2021 tax revenue increase. The fiscal year 2021 budget will reportedly raise more total property taxes than last year’s budget by $844,453, or 3.96%, and of that amount, $335,545 is tax revenue to be raised from new property added to the tax role this year.
The total budget of $55,229,327 is 0.5% higher than last year’s $54,932,642 adopted budget.
University Park Finance Director Thomas Tvardzik said the FY 2021 budget takes effect Oct. 1, 2020.
Highlights of the proposed budget laid out in an earlier public hearing include a 0.9% increase (year-over-year) in the city’s certified property tax base, from $8.3 billion to $8.4 billion, a $202,122 (0.6%) increase in General Fund expenditures, a $509,000 (3.9%) decrease in non-tax revenues, a $711,122 (3.3%) increase in property tax revenue from FY2020, to achieve a balanced General Fund budget.
“I dare say that in a normal year if we didn’t have so many budget pressures coming from non-tax revenue losses, we probably could have gotten this budget through on little more than maintaining the same tax rate as last year, but because we have suffered some losses in non-tax revenue categories, we’re going to have to ask for a slight rate increase this year to cover the amount we needed total of $711,000,” Tvardzik said.
Those losses in non-tax revenue include interest earnings, franchise fees, ambulance fees revenue, Friends of the Library support, parking and traffic fines, and more.
The city council also approved adopting fee schedule changes for fiscal year 2021. The amendment increases sanitation fees by 5% “across-the-board.” No other fees are scheduled to change at this time. The FY2021 fee increase of 5% will reportedly offset the increased costs of tipping and landfill ($50,000), recycling fees ($65,000), and personnel expenses ($37,000).
The city council also approved adopting the fiscal year 2021 pay plan. There are no proposed changes to the FY2021 pay plan structure. Certain positions within the pay plan have been reclassified or renamed to reflect the reorganization of the Engineering division and the Mile Per Year program. In addition a new position, Assistant Director of Human Resources, is reflected in the proposed pay plan. While the Director of Human Resources position is still included in the pay plan, it is currently inactive.
In other news, the council:
- Approved a resolution authorizing the city manager to execute a commercial electric service agreement with Gexa Energy and a professional services agreement with the Texas Coalition for Affordable Power for the 2023-2027 term. The city is affiliated with over 160 other municipalities that form the Texas Coalition for Affordable Power (TCAP). The current contract for electric service will expire on Dec. 31, 2022. As a result of the current contract, the city reportedly experienced an approximate annual savings of $190,000 for calendar years 2018-2019 with the same expected savings continuing for calendar years 2020-2022. The Executive Director of TCAP made a presentation to the city council during a pre-meeting work session this summer. The presentation reportedly included a new proposal for the upcoming 2023-2027 contract called “Strategic Hedging Program” that potentially gives the city an estimated $25,000 annual savings over and above the current contract. TCAP would aggregate power usage of member agencies and solicit wholesale energy pricing two years in advance of consumption. Also, if the energy market experiences a shift that causes unforeseen price increases, the city reportedly has the ability to shift to a fixed price contract during this five- year agreement.