Title
Consideration of and action on approving the maintenance and operations tax rate for tax year 2026.
Body
On August 18, 2026, the City Council took a record vote to begin the process of adopting an ad valorem tax rate of $0.720000 per $100 valuation for tax year 2026 (FY 2026-2027). This rate is unchanged from the current ad valorem tax rate of $0.720000 per $100 valuation set by the City Council for tax year 2025 (FY 2025-2026).
Under Sec 26.05 of the Tax Code, the tax rate consists of two components, the debt service, or interest and sinking, tax rate, and the maintenance and operations tax rate, each of which must be approved separately. A maintenance and operations rate of $0.521341 per $100 valuation is needed to fund the City’s Fiscal Year 2026-2027 budget. This rate represents a 3.46% increase compared to the no-new revenue maintenance and operations rate of $0.503930 per $100 valuation for tax year 2026. This increase requires the following language to be included in the tax rate adoption ordinance, which will be set for adoption at this meeting:
THIS TAX RATE WILL RAISE MORE TAXES FOR MAINTENANCE AND OPERATIONS THAN LAST YEAR’S TAX RATE. THE TAX RATE WILL EFFECTIVELY BE RAISED BY 3.46 PERCENT AND WILL RAISE TAXES FOR MAINTENANCE AND OPERATIONS ON A $100,000 HOME BY APPROXIMATELY $22.98.
The total tax rate of $0.720000 per $100 valuation is set to be adopted by ordinance following the separate approvals of the maintenance and operation and debt service tax rates.
Fiscal/Budgetary Impact:
Ad Valorem revenues in the General Fund of the City’s adopted FY 2026-2027 budget were established based upon a proposed maintenance and operations tax rate of $0.521341 per $100 of valuation.
Recommended action
A record vote is necessary to approve the maintenance and operations tax rate of $0.521341 per $100 valuation for tax year 2026 by motion as follows: "I move to adopt the maintenance and operations tax component of the tax rate of $0.521341 per $...
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