Page 16 - Watauga FY22-23 Budget

BUDGET MESSAGE FOR FY2022-2023

to continue through Fiscal Year 2023. However, there are numerous variables that merit
a cautious approach when developing the current year budget with a long-term outlook.
These include:

o The near build-out status of the City requires a strategic approach to attracting new
development and revitalization of existing businesses.

o Changes adopted by the Texas State Legislature have impacted this budget and
future budgets. Legislation impacts include decreases in revenues due to
franchise fee legislation and elimination of funding for our traffic safety program.
The traffic safety program expenses that were funded by the Traffic Safety Fund
prior to FY2021-2022 were funded by General Fund.

o The City must account for continued inflationary pressures to include the
increasing cost of salaries, benefits, health costs, and supplier increases.

Over the last few years, the City has experienced property valuation increases and Fiscal
Year 2023 (Tax Year 2022) shows property valuation growth of 11% (including pending
ARB accounts). In the last few years, Fiscal Year 2022 (Tax Year 2021) reflected growth
of 7% in net taxable property values and Fiscal Year 2021 (Tax Year 2020) provided for
an increase of 1.5% growth in the City’s net taxable property values. The continued
growth is a combination of an extremely active real estate market in recent years but is
expected to slow down in future years to 3-5% increase. However, planned development
include a 70-home single family residential development is underway on Hightower Drive.
The development will add significant benefit to the City by adding new quality housing
with improved streetscapes, new sidewalks, and greenspace. An additional residential
development along Bursey Road will include 61 single family homes. Future commercial
development includes two package liquor stores, a new office park, and a new retail pad
site.

The City continues a long-term approach through various planning tools. These include
the following:

❖ A Comprehensive Land Use Plan was adopted by City Council to be used as a
tool in the development of the City. As the City approaches full build out, planning
initiatives for re-development and improvement of certain aging corridors in the
City are of primary focus.

❖ The Equipment Replacement Fund put into place a few years ago continues to
be assurance that certain equipment, technology, and vehicle needs will be met in
the future.

❖ The Capital Outlay Plan provides for a 5-year format to identify timing of
replacement and sources of funding for major equipment, vehicles, and technology
City-wide.

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