Page 26 - CityofSouthlakeFY27Budget

TABLE OF CONTENTS

the public’s right-to-know concerning tax rate decisions.

FY 2027 STATUTORY TAX RATE CALCULATIONS
This table shows the tax rates calculated under Texas Tax Code requirements for FY 2027. The no-
new-revenue rate produces the same amount of revenue on properties taxed in both years. The voter
approval rate is the highest rate the City may adopt without an election, and the adjusted rate reflects
unused increment from prior years.

Voter Approval Rate
No-New-Revenue Rate Voter Approval Rate Adjusted for Unused
Increment
Budget Overview
FY 2027 $0.301616 $0.323173 $0.377378

This year the arithmetic is unusual, and the cause is itself notable: FY 2027 brings the first decline in
Southlake’s appraised value in at least thirty years. Total appraised value fell 0.7% to $15.4 billion, and
taxable value after exemptions declined 0.5% to $12.3 billion (including the TIRZ). New construction
added roughly $110.4 million in value, about 85% residential and 15% commercial.

That decline is what drives this year’s rate math. Taxable value and the no-new-revenue rate move in
opposite directions: when values rise the rate falls, when values hold flat it is unchanged, and when
values fall the rate rises. Because value fell this year, the FY 2027 no-new-revenue rate ($0.301616) lands
above the current rate, an unusual result that reflects falling values rather than any increase in what the
City collects.

TAX RATE OPTIONS
On August 4, 2026, the City Council considered and provided direction on establishing the property
tax rate for FY 2027. Staff prepared three tax relief options for FY 2027 and the funding decisions
associated with each. Rate comparisons are measured against the current tax rate of $0.295000, and
the average appraised home value of $1,085,031.

Tax Rate Average General Facility Public Safety
Rate vs. Vehicle Technology
Options Tax Rate Existing Tax Reduction Valued Fund Maintenance Replacement Fund Equipment
Rate - Revenue Home CIP Cash Reserve Transfer Transfer Fund Transfer
Impact Tax Bill Funding Transfer
No-New- $0.301616 $0.006616 $0 $2,583 $4.3M $2.0M $1.5M $1.0M $2.0M
Revenue
Reduced
New
Revenue $0.295000 $0.000000 ($770,719) $2,526 $3.5M $2.0M $1.5M $1.0M $2.0M
(Existing
tax rate)
Reduced
New
Revenue $0.290000 ($0.005000) ($1,353,185) $2,483 $2.5M $2.0M $1.5M $1.0M $2.0M
(Tax rate
reduction)

The majority of the City Council expressed support for reducing the current tax rate. Two members,
while supportive of continued tax relief, indicated they wanted to further evaluate the City’s expenditure
management before committing to a specific rate.
26 FY 2027 City of Southlake | Budget Book FY 2027 City of Southlake | Budget Book 27