STRATEGIC PRIORITY: Government Performance & Financial Management
AGENDA DATE: August 23, 2023
COUNCIL DISTRICT(S):
DEPARTMENT: Budget and Management Services
EXECUTIVE: Jack Ireland
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SUBJECT
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Authorize (1) a public hearing to be held on Wednesday, September 20, 2023 to receive comments on a proposed tax rate; and (2) a proposal to consider adoption of a $0.7393 per $100 valuation tax rate, or a lower rate as may be proposed by City Council for the 2023-24 fiscal year on Wednesday, September 20, 2023 - Financing: No cost consideration to the City
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BACKGROUND
The City Manager’s recommended FY 2023-24 budget as discussed on August 8, 2023 includes a tax rate of $0.7393/$100. The proposed rate reflects a reduction of $0.0065/$100 and reduces revenue to the City by $12.7 million.
A public hearing is required this year since the proposed tax rate is lower than the voter-approval tax rate but higher than the no-new-revenue tax rate calculated by the Dallas County Tax Office. The notice of the public hearing provides information about the no-new-revenue and voter-approval tax rates reflected below.
Notice of Tax Rates
Proposed tax rate: $0.7393/$100
No-New-Revenue tax rate: $0.6813/$100
Voter-Approval tax rate: $0.7028/$100
Unused Increment rate: $0.0454/$100
Voter-Approval tax rate adjusted for unused increment rate: $0.7482/$100
The Voter-Approval tax rate reflects an adjustment for unused increment rate. The unused increment rate is the rate equal to the difference between the adopted tax rate and the voter-approval rate in tax year 2021 (FY 2021-22). A taxing unit may adjust the voter-approval tax rate higher with the unused increment rate without triggering an election. If a taxing unit uses any portion of the unused increment rate in a year, the contribution to the unused increment would be zero for that year. The City Manager’s recommended FY 2023-24 budget uses unused increment.
To set a tax rate above the FY 2023-24 calculated No-New-Revenue tax rate of $0.6813 per $100 valuation, State law requires the following:
• Specify a proposed tax rate; take a record vote, and schedule a public hearing (August 23, 2023);
• Publish “Notice of 2023 Tax Year Proposed Tax Rate” at least seven days before the public hearing (September 9, 2023);
• Publish the notice in the newspaper and prominently on the City’s internet website;
• Hold a public hearing; and the meeting to adopt the tax rate (September 20, 2023).
City Council may vote on the proposed tax rate at the public hearing.
PRIOR ACTION/REVIEW (COUNCIL, BOARDS, COMMISSIONS)
City Council was briefed on the City Manager’s Proposed Budget on August 8, 2023.
FISCAL INFORMATION
No cost consideration to the City.