Page 63 - Hurst Adopted FY22 Budget

APPROVED FISCAL YEAR 2022 BUDGET
revenue policies

REVENUE POLICIES

Property Tax

The tax rate should fall within a reasonable range of comparable cities and should be adequate
to produce the revenues needed to pay for approved City services. Each year the city will
calculate the no-new-revenue rate and the voter-approval tax rate in accordance with the State
of Texas Truth in Taxation laws. If the City Council proposes a tax rate that exceeds the voter-
approval rate that citizens will be able to vote on the proposed rate. The Notice of Vote on Tax
Rate is located in the Appendix. The City was not required to hold a public hearing on the tax
rate due to the tax rate not being increased or exceeding the lower of the the no-new-revenue
or voter-approval rates.

Section 5.42 of the City’s Charter limits the maximum tax rate to $1.50 per $100
property valuation. This is one dollar lower than the $2.50 allowed by state laws. The City
grants the following tax exemptions on individual property taxes:

• 20% homestead exemption,
• $35,000 senior citizen exemption,
• $35,000 disabled citizen exemption, and
• up to a $12,000 disabled veteran exemption.
• Tax Freeze works by ensuring that a senior or disabled homeowner will not have a
municipal tax bill any higher than the amount owed in the year in which he/she
became eligible for the limitation

Sales Tax

Sales tax revenue projections shall be conservative due to the volatile nature of this economically
sensitive revenue source. Sales tax projections, including sales tax reserve, have been adjusted
to account for recent downward trends and other indicators related to sales tax.

Fiscal year 2022 marks the nineteenth year of a 20 year agreement with the developer of
North East Mall. Under this agreement, the developer receives a rebate for a portion of sales
taxes earned above the rates prior to the expansion of North East Mall and the construction of
Shops at North East Mall. The developer’s rebate is capped in both time and total dollars. The
shops portion of the agreement reached maximum value during the 2008-2009 year allowing
the City to begin collecting 100% of associated sales tax earnings in 2009-2010. The North
East Mall sharing agreement has periodic reductions in the sharing percentage over time.
Each reduction will return additional sales tax revenue the city. However, at the expiration of
the sharing agreement, the city anticipates additional partnership with North East Mall to
ensure its continued success.
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