TYLER, TX (KLTV) - The City of Tyler is proposing a 1-cent property tax rate increase in their proposed budget presented to the city council on Wednesday morning.
The recommended increase from 23 to 24 cents per $100 valuation is due to lower sales tax revenue and declines in oil and gas sector, according to the city.
If approved, the proposed increase translates into about $15 more per year on a home valued at $150,000. Tyler's property tax rate is historically among the lowest in the state, and will remain so if the proposed increase is approved in September.
"This stagnation has been devastating to city operations," said Tyler City Manager Ed Broussard.
Think of the city's general fund as an apple pie.
The apples must come from somewhere. As the budget stands now, about 29 percent of those apples come from property taxes, while about 41 percent come from sales tax.
But the sales tax apples aren't as dependable as they used to be, so the city says they need to lean more on the property tax apples to keep serving the same pie.
The city is projecting a $867,572 shortfall in sales tax apples for the two months remaining in this fiscal year, Broussard said.
Tyler Water Utilities is proposing a $1 base rate increase for both water and wastewater, as well as a 1.5 percent increase for volumetric rates over 25,000 gallons of consumption.
Consumers will also see a $1.28 regulatory compliance fee on their bills, which will generate revenue restricted to service debt issued for EPA regulatory compliance.
Solid waste is proposing a $2 per week increase for twice weekly residential trash pickup, the first rate increase in six years.
Other efforts are also being proposed to trim and slim the city's budget.
City employees would not see pay raises this year, but under the proposed budget they will be given a $500 lump sum payment, in part to help offset the increase in health insurance premiums.
Employees will see anywhere from a $15 to $113 per month increase depending on the number of people the employee elects to insure, and new hires will have to wait 90 days before health care benefits begin, if the proposed budget is approved.
A general hiring freeze in place during the past year will be partially lifted. Fifty-one positions were frozen as they were vacated, saving the city about $1.3 million. The proposed budget would fill 38 of those positions. The remaining 11 positions, as well as two police recruit slots, will remain frozen until March 2018.
The city is also proposing funding cuts to outside agencies, requesting that those agencies, such as the Northeast Texas Health District, use fund balances and unspent revenue for operating during the coming year.
"I will also be requesting that the City and other local governments come together and collectively audit outside agencies receiving taxpayer funded allocations on an annual basis," Heines said.
Opportunities for the public to provide input on the proposed budget are available during city council meetings. Those are scheduled for 9 a.m. on Wednesday, Aug. 23 and 9 a.m. on Wednesday, Aug. 30 at the Tyler City Hall, 212 N. Bonner Ave.
Final adoption of the budget is scheduled for Sept 13.