Page 87 - ClearGov | Documents

Proper ty Taxes

Proper ty taxes are the largest revenue source for the City of Colleyville's governmental funds, essential for funding general
city ser vices, including public safety, public works, and leisure ser vices. The City bene{ts from a strong residential base,
which provides stability and helps mitigate the negative effects of economic |uctuations. In recent years, proper ty values
across Texas have experienced signi{cant growth, and Colleyville is no exception.

The Tarrant Appraisal District (TAD ) is responsible for assessing proper ty values in Colleyville, while the City has a contract
with Grapevine -Colleyville Independent School District (GCISD ) to collect proper ty taxes on its behalf. According to the
City's char ter, the maximum proper ty tax rate cannot exceed $1.50 per $100 in valuation. Fur thermore, any tax rate set per
budget year shall not result in an ad valorem tax revenue increase greater than seven percent (7%) of the total ad valorem
tax revenue collected in the preceding budget year, unless authorized by the voters of the City at a special election. It is
impor tant to note that any additional ad valorem tax revenue generated from new construction is excluded when
determining whether the increase exceeds the 7% threshold.

For Fiscal Year 2026 , the City Council has set the proper ty tax rate at $0. 311931 per $100 in valuation, which is above the no -
new-revenue (NNR) rate and the Fiscal Year 2025 rate of $0. 276204 per $100 in valuation. This decision aligns with the City ’s
long-standing philosophy of only raising taxes when absolutely necessary. The City is committed to ensuring that any tax
increase is clearly justi{ed and necessary to meet the community's needs.

This year's tax rate adjustment was driven by several factors, including increased operating costs brought on by in|ation,
higher material costs, and ongoing supply chain issues. Additionally, the City has faced increased debt ser vice obligations
related to the purchase of new {re apparatus and higher costs associated with police vehicles. To provide relief to
residents, the City implemented a 14% general residential homestead exemption this year. This exemption is par t of the
City Council's continued commitment to minimizing the tax burden on citizens. While the rate increase was necessary to
maintain the high level of ser vices expected by the community, the homestead exemption helps offset the impact on
homeowners, re|ecting the City ’s balanced approach to {scal management .

Looking ahead, the City Council will continue to carefully consider the amount of revenue required and set tax rates
accordingly, ensuring that any increase is fully justi{ed for speci{c programs or ser vices that bene{t the community. The
approach remains focused on balancing the need for high- quality ser vices with the goal of minimizing the tax burden on
residents.

Revenue estimates are carefully calculated based on the cer ti{ed values provided by TAD and the required revenue to
maintain essential ser vices and meet {nancial obligations. The City ’s philosophy is to set the lowest possible tax rate that
still allows us to provide the high level of ser vice expected by our community.

Proper ty Tax Revenues by Fund

FY2021 $ 2 3 M
$
2
3
M
$23M
2
M
M
2
2
2
$
FY2022 $22M
$
FY2023 $23M
2
3
3
2
$
$
M
M
2
4
M

$24M
$
FY2024 $ 2 4 M
$26M
$
2
M
6

FY2025 $ 2 6 M
2
FY2026 $ 2 7 M
7
M
$27M
$

0 $5M $10M $15M $20M $25M $30M
General Fund Tif Fund Debt Ser vice Fund
FY 2025-2026 Annual Budget | Colleyville Page 87