Page 6 - PantegoFY24AdoptedBudget

Ad Valorem (Property) Tax. Property tax is the second largest source of revenue for the General
Fund, comprising 35.4% of the total General Fund revenue Budget for Fiscal Year 2023-2024. Property
tax revenue is calculated by multiplying the tax rate by the property tax base. Revenue from Ad Valorem
(Property) taxes is currently projected to increase based upon the Certified Tax Roll from the County
Appraisal District and a proposed tax rate increase.

o Property Tax Rate. This is the actual rate adopted by the Town Council. It consists of a component
which together with various other revenues, funds the operations of the Town’s General Fund (the
maintenance and operations (M&O) rate) and a second component which funds principal and interest
requirements on the Town’s general obligation and certificates of obligation bonds (the debt service
(I&S) rate). The property tax rate in the Budget is $0.570000 per $100 valuation, an increase of
19.8% from the current adopted rate. Although this is a significant increase, over the past several
years our rate has not kept up with the pace of inflation. Furthermore, looking back over the past twenty
years our proposed rate is only 22.4% higher than the rate was in 2001. Furthermore, we are only one
of three Municipal Governments in Tarrant County that allocate a portion of our Sales Tax Receipts to
the reduction of Property Taxes.

▪ Maintenance and Operations Rate (M&O rate) – The M&O rate for Fiscal Year 2022-2023
is .431809. For Fiscal Year 2023-2024 the proposed M&O rate is .417934. This reflects a
decrease of 3.2%
▪ Debt Service Rate (I&S rate). The debt service (I&S) rate for Fiscal Year 2022-2023 is
.044122. This is the rate that was required to make our principal and interest payments on
the Certificates of Obligation issued in 2019. Due to the issuance of additional Certificates
of Obligation in 2023 The rate required to meet our debt obligations in 2022-2023 that will
be funded by Ad Valorem Tax is .152066. This reflects an increase of 244.6%.

o Property Tax Base. The Town’s estimated 2023 net taxable value projection provided by the Tarrant
County Appraisal District as of July 20th is $435,504,829 8.3% higher than 2022's net taxable value
projection of $402,049,157.

Sales Tax. Sales tax revenue is the largest revenue source for the General Fund, representing 37.3%
of total revenue projected for the Fiscal Year 2023-2024 General Fund budget. Total revenue from sales
tax in FY 2023 is projected at a total of $3120,000; $1,950,000 budgeted in the General Fund, $390,000
in the Street Improvement Fund and $780,000 in the Pantego Economic Development Corporation
(PEDC) Funds. The 2 (two) cent or sales tax revenue the Town collects from the State is allocated as
follows:
General Fund 62.5% or 1.25 ¢
Street Improvement Fund 12.5% or .25 ¢
PEDC 25.0% or .50 ¢

Revenue from the Town’s 62.5% or 1.25 ¢ General Fund sales tax allocation equals $1,950,000, a 3.7%
increase from the current year’s Budget of $1,880,793. Aggregate historical data and current economic
predictions are used to project future sales tax revenue. Therefore, the Town takes a conservative
approach to forecasting sales tax receipts. Combined, ad valorem (property) tax and sales taxes will fund
approximately 60.5% of General Fund maintenance and operations for Fiscal Year 2023-2024.

ADOPTED BUDGET FY2023-24 TOWNOFPANTEGO.COM/BUDGET PAGE 4