Do You Support Raising Taxes?

August 30th, 2017 by

The following is a letter to the editor from councilman Chris Rich. He is breaking down the budget and taxes facing Aubrey and is looking for your input. 

Okay Aubrey neighbors, time for another poll. This one is more important than the last one. It’s budget time and has to do with the tax rate. I’ll start with a little background so you have more of an understanding of what I’m asking.

  • The City of Aubrey currently has a tax rate of $.561956 per $100 on the appraised value of your home.
  • The Mayor is proposing to keep the rate the same ($.561956) this year. This equals an increase of 3.7% in the amount of taxes you pay. This is on top of a 4.2% increase last year AND a 11.8% increase the year before. If this year’s increase passes, this would be about a 21% increase in the last three years.
  • The proposed effective tax rate from the County is $.542049 per $100. This is a decrease of $.019907 from the current rate and generates the city about the same tax revenue as last year’s rate based on increased home values.
  • According to the City Administrator, the proposed rate generates the City about $37,000 more than the effective rate.
  • The proposed rate still results in a negative balance budget, to where the city has to pull $34,646 from its reserves.

The new subdivision on FM1385 is paying to the city $4,137 for every permit that is pulled and is un-restricted on how the city can use it. But the Mayor does not want to use this money to supplement the budget between now and when the City actually collects tax revenue from those homes in a couple of years. If we used the money that has already been collected we could cover the $37,000 tax increase and keep taxes the same for this year.

At our meeting Tuesday, it was suggested by one of the Council members that if we asked around, we would find out that people would support paying more in taxes.

So, to test that statement…

Do you support the tax rate staying the same and increasing the amount you pay in taxes for the 3rd year in a row, totaling almost 21%?

-OR-

Do you support lowering the tax rate to the effective rate of $.54209 and paying the same amount in taxes that you did last year?

I hope this helps you understand this a little better. Budgets and taxes are always the most complicated part of running the City and can impact every taxpayer’s budget.

  • The City’s overall appraised value (due to home value increases and newer construction) has increased from &186,512,876 to $200,181,709. A 7.33% increase.
  • The proposed tax rate, $.561956, is the exact same rate as last year. This would increase the City’s tax revenue by about $37,000 and would affect each household by about $30.
    The effective rate provided by the County ($.542049) would keep the revenue for the City about the same as last year.
  • It was said at the last meeting, that “we have continually lowered taxes when we shouldn’t have been”. But that isn’t true. While the tax rate has gone down, the amount of taxes we pay has not. Any tax rate adopted that is higher than the effective rate is an increase in the amount of taxes we pay. Last year, the rate set increased the amount you paid by 4.2%. The year before that, the rate set increased the amount you paid by 11.8%. This years proposed rate would increase the amount another 3.7%. So in 3 years, so that’s about a 21% increase in the taxes you pay. On a $150,000 home, your taxes have increased $158 a year.

There’s another piece to the puzzle.

Out on FM1385, there is the Winn Ridge housing development, that is inside the City Limits of Aubrey. When this development was first discussed, it was a consensus that we (the Council) didn’t want the new homes here in this development to drive up our taxes here in this part of town.

  • The build-out schedule for this development calls for about 100 homes per year.
    When a new home is built, it takes 12-24 months before the City sees any property taxes from it. (Due to timeline of appraising the property as something other than vacant land to the owner paying its first tax bill)
  • These new homes/residents need Police and Fire Services just like the rest of us.
    The City collects $4,137 per home ($413,700/yr. based on 100 homes being built) from the developer and I fought during negotiations that those funds were not restricted in any way on how the City could use them.
  • The City also collects $500 per home ($50,000/yr. based on 100 homes being built) from Mustang, that I believe should appropriately go to the water department.
  • The Mayor doesn’t want to use these funds to supplement the budget because she sees them as one-time funds. While these funds are indeed collected one time at the time the building permit is pulled; the development is about 1400 homes and at 100 homes a year, we would collect this money for about 14 years. Plus we already have over $60k in this account that has been collected so far on the homes that have already been started out there.
  • BUT, we only need this money to supplement the budget for the next year or two to cover the gap until we start collecting property taxes on those homes.

We could easily take $37,000 from these funds and cover the difference from dropping the tax rate to $.542049. We could also cover the $36,000 that is being pulled from the City’s reserves that is in the budget. And we could use some of the money to get a full time, permanent City Administrator, rather than the interim that we are using now. Plus, we could supplement the Police and Fire Departments for any increases in their budgets over what is already in this budget due to covering the Winn Ridge development. In the end we would still have money left over. Then, when we start collecting property taxes on those homes, we have all $413,700 a year to use to improve the City.

While there are some improvements needed in the City on Streets, Drainage, and a plethora of other things, they can be accomplished if well managed and all available revenues are considered.

An increase in your property taxes to the City on top of the proposed Aubrey ISD tax increase (if passed), to me, would be burdensome on Aubrey taxpayers.

If you have any further questions, don’t hesitate to ask. I will do my best to get everyone an answer as quickly as possible. If you would like to email me, my email is [email protected]