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ADOPTED | BOOK

allowances combined mean that the vast majority of existing residents will not experience an actual
increase in city property taxes even in a rising value market.

Citizens Survey and City Goals

The biannual citizen survey was completed in November 2021. Areas identified by the citizens as
high priority needs where their expectations are not being met focused on two areas: our
street/transportation system and code enforcement. Discussions during the May 2022 City Council
Goal Development Sessions affirmed the priority of addressing these service needs. This budget
includes increased resources in both of these areas.

TIF #2

On a positive note, all costs related to TIF #2 have been funded and the property taxes from this
district, which consists of the area around Hometown, can now be used to fund basic city services
such as police, fire, streets, parks and code enforcement. This also means that 10% of our tax base
is now available to fund operations and city-wide debt. This increases funding for maintenance and
operations (General Fund) by over $2,000,000 and increases capacity in the Debt Service Fund
(Interest and Sinking tax rate) by approximately $1,200,000.

TEXRail

TEXRail payments begin January 1, 2023. That seemed like a long time ago in 2014, but it is here
and we have it funded due to the completion of TIF #2. This payment will be $2,000,000 in 2023.
This cost will increase by 5% annually until 2035 where it must equal 3/8 of 1% of sales tax.

Inflation

Inflation is a major factor as we are seeing an increase in almost every item or commodity that we
purchase, just like everyone else. According to the Bureau of Labor Statistics, consumer prices are
up 9.1% over last year. The adopted FY23 budget includes several inflationary increases to
operations. They include:
 Fuel costs are projected to rise by $400,000 next year with $138,535 of this increase coming
in the General Fund.
 $23,900 in Neighborhood Services for animal services lab fees, medical purchases,
chemicals, postage, and cleaning supplies.
 $21,500 in contract mowing services for parks, rights-of-way, and other city-owned
properties.
 $6,200 in clothing expenses in the Police Department.
 $34,500 in Fire Department for medical and first aid supplies, janitorial supplies, clothing,
training, association dues, testing fees, and software licenses.
 $75,000 in Fleet Services for vehicle replacement parts, tires, oil, training, and certifications.

18 NRH | TEXAS