Page 10 - CITY OF WATAUGA, TEXAS ANNUAL BUDGET PORTRAIT

July 25, 2025

To the Honorable Mayor Arthur L. Miner, Members of the City Council and the
Citizens of Watauga:

I am pleased to present the City Manager’s Adopted Annual Budget for Fiscal Year
2025–2026, in accordance with the City of Watauga’s Home Rule Charter. This
budget summarizes revenues, expenditures, departmental highlights,
accomplishments, and includes the five-year Capital Improvement Plan (CIP). Filed
with the municipal clerk on July 25, 2025, the budget reflects actual certified values
and corresponding adjustments to property tax revenue and rates. Updates to the
General Debt Service Fund were also made to reflect the proposed 2025 Certificates
of Obligation. The adopted budget is available on the City’s website for public review.

As the City’s primary financial planning tool, the budget aligns resources with the
City Council’s Strategic Plan, continuing the conservative fiscal approach that
supports Watauga’s strong financial standing and AA bond rating from Standard &
Poor’s. The Budget Summary section provides an overview of key revenues,
expenditures, and fund balances.

Economic activity remained stagnant during FY2024–2025, with limited sales tax
growth. However, the City filled many prior staffing vacancies, particularly in
the Police Department.

In developing the FY2025–2026 budget, our focus remains on delivering high-
quality services and retaining our skilled workforce.

Highlights of the budget are presented below:

• The adopted property tax rate for FY2025–2026 is $0.570200 per $100 of
assessed valuation, unchanged from FY2024–2025 and below the calculated de
minimis rate of $0.570248. Established by Senate Bill 2 (2019), the de minimis rate
offers smaller taxing units relief from the 3.5% voter-approval cap. The adopted
rate will generate approximately $500,000 in additional operating revenue to
address cost increases and support debt service, including payments for the
proposed 2025 Certificates of Obligation. These funds will finance park
improvements, a new ambulance, streets, and sidewalks.

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