Sugar Land City Council has approved a $282.2 million budget for fiscal year 2010-2011 with a tax rate of .30 cents per $100 of property valuation, the same tax rate since 2007.
Although there was a 10 percent decline in commercial properties, a small increase of 0.9 percent in residential value makes the tax rate less than the effective tax rate, which is the amount needed to generate the same revenues as last year.
Sugar Land’s fiscal year begins Oct. 1 and ends Sept. 30.
“The City’s conservative approach to the budget recognizes the economic hardships being experienced by the community as well as the City,” said City Manager Allen Bogard. “The City’s focus for 2011 is to maintain current service levels within available resources and continue our economic development activities.”
The budget includes a rate increase for utilities and solid waste that become effective Jan. 1 and March 1.
The utility rate increase is needed to support pending debt issues for the construction of a surface water treatment plant, a project needed to meet a legislative mandate to convert from ground to surface water, and to meet contractual obligations, according to city officials.
Customers who consume an average of 11,000 gallons of water per month and have a winter average of 6,700 gallons for wastewater will see an increase of approximately $4.37 per month.
The solid waste rates are also increasing due to contractual obligations. Residential customers will increase to $17.63, or .93 cents per month.
A reallocation of a half-cent from debt service to the maintenance and operations component of the tax rate is included in the FY11 budget. The 2010 certified tax roll is a 0.55 percent increase over 2009, with growth coming from the addition of new property in the city.
Along with many other cities, Sugar Land experienced a decline in revenues compared to budget estimates during the last year. Sales tax and interest income are the revenue areas that have been most impacted by the economy. Expenditure reductions made during the last year have been included in the FY 2011 budget to address the decline in revenues.
As a result, the operating budget for FY11 totals $94.6 million and is 0.4 percent less than the previous year’s budget. The majority of this reduction is due to a 2.3 percent decline in city services costs.
In accordance with the overall reductions, the budget includes limited new and/or expanded services:
- A new recreation center is set to open in early 2011. The project was funded in 2010 from voter approved general obligation bonds and will be partially supported from user fees.
- Fire Station #7 will be under construction soon in Telfair and will open in the summer of 2011. Under the Strategic Partnership Agreement with New Territory, their residents will pay an increased fire protection fee once the station opens. The fire department is committed to opening the station within existing resources and staffing. A study is underway that will make recommendations as to the best way to accomplish this objective.
- A city-operated Convention & Visitors Bureau is funded from hotel occupancy taxes. These restricted revenues must be spent to promote tourism within the city.
- There are two major capital projects included in FY11:
o The surface water treatment plant and transmission lines, which is a mandated project. This is funded through the city’s Utility System and Ground Water Reduction Plan Participants.
o A minor league baseball stadium and parking. This project will be funded through the Sugar Land 4B Corporation.
The fiscal year 2011 budget includes a number of actions to adjust the city’s spending due to lower revenues from sales taxes and interest income. Departmental spending has been reduced, and although the budget includes the elimination of 20 positions, there are no planned layoffs and the reduction in positions will be achieved through attrition, use of technology, reassignment and redistribution of work among existing staff members.
No merit salary increases are included in the budget, and employee health benefits have been capped at a 6.5 percent increase based on the City’s contract with Cigna.
The city projects that current economic conditions will continue throughout 2011, therefore, sales tax revenues are estimated to remain as collected during Fiscal Year 2010.
FBCAD unlawful action to benefit corperate commercial tax cuts? Yes, the
central appraisal provide a 10 percent appraisal cut an reduce value to commercial property, thence increase appraisal value on residential property by 9 percent.