Kyle calls for taxes, utility rate increases: City employee salary raises account for almost half of budget increase

Kyle City Council and staff members meet for a budget workshop to hammer out the finer details of the fiscal year 2013 budget. (Photo by Andy Sevilla)


Kyle homeowners could see an average increase of $50 on their annual property tax bill, and utility customers can also expect their bills to be a little more expensive, as City Council members consider an increase of 20 percent on water and waste water rates.

City employees will also see an increase in their pay.

Kyle City Manager Lanny Lambert has proposed a $41.6 million budget for Fiscal Year 2012-2013, which calls for a property tax rate of $0.5244 per $100 of taxable property valuation, a jump of $0.0399 cents from the current fiscal year. Lambert said the tax increase would raise about $554,668 and would pay for a reduction in interfund transfer, increased debt service, increased fuel costs, contracted EMS services and police department step pay increases.

Council members voted last Wednesday to move forward with the proposed tax rate, with only Bradley Pickett dissenting.

City documents show that Kyle’s average homestead, valued at $125,097, will pay $49.91 more on their property tax bill, or $4.16 per month. Meanwhile, city employees will receive a pay jump of 3.5 percent.

The cost of living adjustments city employees will receive is estimated to cost the city about $260,000, or almost half of the projected tax-rate increase revenue.

Lambert did concede that the tax rate could have been proposed at a lower rate, but that would have called for either no city employee pay increases or city layoffs, or cuts in city programs – a move he said he wasn’t willing to take.

“We didn’t give (city employees) a raise last year, and the year before we gave a one percent raise. So I feel like we’re falling behind on our ability to attract and retain quality employees,” Lambert said about the prospect of proposing a lower tax rate if no pay increases were offered to city employees. “If we don’t address our salary issues, we wouldn’t be able to recruit employees in the future, because our salaries are so low. I believe that we’re at the point where we have to address our competition with our salaries, and I think we need to reward the employees that have been loyal to us and stuck with us all these years with no raises.”

Several city department heads voiced the need for more personnel, but Lambert said that he ultimately decided to forgo new hires and instead address salary issues for present employees.

The rate jumps for water and waste water are necessary, Lambert said, because the current rates cannot cover all the required utility expenditures. Without the rate increases, a city funding-gap analysis shows, water will be in the red for about $1.8 million and waste water will also have a funding gap of about a half million dollars for next year alone. The analysis shows that with the 20 percent rate increase for water and waste water for fiscal year 2012-2013, a funding gap of $530,043 would still exist. The funding gaps are due, in part, to increases in total operating costs, Guadalupe-Blanco River Authority (GBRA) operating and maintenance costs, GBRA increased capacity, and overtime compensation.

City documents summarize the proposed budget, with the biggest chunk going to the General Fund at $13,146,287, or 31 percent. Bond and Capital Improvement Projects make up 28 percent of the budget at $11,632,207. The remainder of the budget would go to the Utility Fund, Debt Service and all other at $11,302,205, $5,259,406 and $220,809, respectively.

The proposed budget can be found on the city’s website, and there are five more scheduled budget meetings before its implementation. The proposed budget and utility rate increases will take effect on Oct. 1.

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