1. 2011 PROPOSED PROPERTY TAX RATE Funding the 2011/12 General Fund Budget Public Hearing – August 9, 2011

2. 2011 Proposed Tax Rate  Overview of Property Taxes  2011/12 General Fund Budget Overview  Tax Highlights

3. Property Tax Overview  Ad Valorem Taxes (in proportion to the value)  Based upon the value of your property  Value is determined by outside agency (Williamson Central Appraisal District)  WCAD determines “market value”  City does not determine value of property  WCAD does not set the tax rate

4. Property Tax Overview  City’s property tax rate set by the Council  Funds on-going General Fund operations Public safety, library, social services, parks & streets  Funds payments on debt for general government (not utility related) improvements  Calculation: Tax rate x taxable value/$100 = your City tax levy

5. Property Tax Overview  Property Tax Exemptions  Lower the taxable value of your property  Do not affect market value  City may grant to groups of property owners

6. Property Tax Overview  Exemptions the City currently offers:  General Homestead - $5,000  Over 65 Homestead - $12,000  Disabled - $40,000  Disabled veterans (mandatory) – variable  Revenue frozen for Over 65 & Disabled  “Freezes” revenue - 1 st year of exemption Adopted in 2004 for 2005 Tax Year

7. 2010/11 General Fund Budget  Total General Fund budget =$40M  2.8% increase from 2010/11 projected Includes $985K 1-time projects  Includes increased Contingency Reserve Funds to $7.1 million Includes 90 days operating expenses $6.847 million in 2010/11

8. “Status Quo” Budget  Revenues remain relatively flat  Slight increase in sales & property tax  Development related revenues continue to lag  No operational increases without warranted need  Service levels remain stable  No employee COLA or merit bonus  Will review again at Mid-year Revenues greater than anticipated

9. 2011/12 General Fund Increases  Opening Fire Station 5  12 Firefighters Add 3 new and fund previously 9 granted funded positions June 2012  Station operations  Fire Training Facility operations  Construct Fire Stations 5 & 2  New Station 2 to be located next to existing station  Debt impact of Fire related facilities  Public safety step plan  Annual compensation increase for police & fire

10. 2011/12 General Fund Increases  Bookmobile Librarian added  Grant funded position Year 1  Increased fuel costs - +$56,183  Increased Health Insurance costs  Offset by decrease in retirement contribution

11. Other Impacts:  Reallocate resources  2 building inspectors temporarily transferred to GUS for CIP inspections  Reduce Associate Judge costs in Court  “Freeze” additional positions Warrant officer assigned to Municipal Court Director of Community Services  17 total positions “frozen” all year  4 additional positions for 6 months Municipal Court Clerk Heavy Equipment Operator in Streets

12. 1- Time Funding  Funded with excess funds in General Capital funds  Interest earnings  Remaining bond funds  Repairs to San Gabriel Park restrooms  Repairs to restrooms at Grace Church  Equipping Fire Stations 5 and 2  Review Sanitation/Recycling contract & RFP  Convert email system to Microsoft Exchange

13. General Fund Revenue Sources

14. General Fund Revenue Comparison

15. 2011 Tax Highlights

16. 2011 Proposed Tax Rate  Ad Valorem Property Taxes  Assessed valuation  Components of the Tax Rate  Effective Tax Rate  Rollback Rate  Proposed Tax Rate  What does the Tax Increase Fund  Impacts to Homeowner

17. 2011 Assessed Valuation  Certified valuation = $4.318 Billion  Net of $35.1M in TIF districts  Includes $92.5M new/annex property  Includes $1.256B frozen property Equals 29% of total valuation 8.5% increase in 2011  2010 final taxable value = $4.229 Billion  2010 frozen value = $1.157 Billion Equals 27% of total valuation

18. Assessed Valuation

19. Assessed Valuation per Capita

20. Taxable Value by Property Class

21. 2011 Taxable Value by Property Class

22. Components of the Tax Rate  Operations and Maintenance (O&M)  GENERAL FUND Fire, Police, Parks, Library, Streets  Interest and Sinking (I&S)  TAX SUPPORTED DEBT PAYMENTS Bonds issued for capital improvements Does not include self funded utility and GTEC debt

23. Effective Tax Rate The rate necessary to derive the same amount of revenue as previous year based upon the current year assessed valuations  Effective rate = $0.36901  Adopted 2010 tax rate = $0.35622  Proposed 2011 tax rate = $0.38750  Includes $0.032 sales tax for property tax relief

24. Rollback Rate  The rollback rate is a calculated maximum rate allowed by law without voter approval. Calculated: 8% increase in O&M effective rate + Current year I&S rate = ROLLBACK RATE  2011 Rollback Rate = $0.41232

25. 2011 Proposed Tax Rate: $0.38750  5% increase over effective rate  1.4% increase in O&M rate Equals $70K in new General Fund Revenues  20.7% increase in I & S (debt service) $0.026 due to Nov 2011 bonds (2008 authorization) $0.005 due to increase in 2011 CO for fire facilities  $94M increase in “Frozen” property = ($100.5K) revenue loss  Increase in abated property  Citicorp abated 100%

26. Comparison of Rate Components  Operations & Maintenance (General Fund)  2010 = $0.21987  2011 = $0.22290  Interest & Sinking (Debt Service)  2010 = $0.13635  2011 = $0.16460  Total Proposed Tax Rate  2010 = $0.35622  2011 = $.038750  8.7% Actual Tax Rate Increase  Primarily related to debt service

27. Tax Rate Components

29. Average Home Values  2011 TAXABLE average value = $184,959  Taxable value before exemptions  1.18% increase over prior year taxable average of $182,799  2011 MARKET average value = $197,260  Compared to 2010 average market of $194,857

30. Average Home Value (Taxable Value)

31. Impacts on Average Homeowner - Property Tax Increase  2010 Average Taxable Value = $182,799  2010 Taxes @ $0.35622 = $651.17  2011 Average Taxable Value = $184,959  2011 Taxes @ $0.38750 = $716.72  Difference = $65.55 annually  10% increase Increase 2008 Voter Approved Bonds = $55.49

32. Tax Rate Adoption  Required public hearings  August 9  August 18  Vote on levying 2011 tax rate  August 23 - First Reading  September 13 - Second Reading  October 1 - beginning of new fiscal year

33. QUESTIONS?