by BRAD ROLLINS

The Kyle City Council is committed to spending less cash next year than this year for capital outlay, shaving nearly a cent and a half from an anticipated property tax increase, Mayor Lucy Johnson said this week.

Council members at a recent budget workshop agreed to spend no more than $356,674 from its general fund to pay outright for projects, less than the $549,449 included for similar jobs in the current year’s budget.

“We have been issuing debt over the last eight years to help us grow and build our infrastructure. Partially because of the recession, we haven’t had the growth in sales tax and property tax revenues that would have stopped a tax increase from happening,” Johnson said. “The hard truth is that in a recession it is very difficult to keep the same level of service without increasing the tax rate. I am very concerned with saving as much taxpayer money as possible without lowering our level of service.”

The council’s recent cost-cutting will help blunt the impact of a forthcoming tax hike but is nonetheless modest compared to the $8.9 million in new debt the council is considering borrowing through its utility and general funds. Those loans will fund projects that include infrastructure for a new library, securing future water supplies through the Hays Caldwell Public Utility Agency and the city’s share of reconstructing Dacy Lane.

New capital improvement program spending is on course to increase the tax rate four cents per $100 in property value, interim City Manager James Earp said, in addition to a two-cent increase the city will need in order to pay its note on money already borrowed. That’s a projected six-cent property tax increase, about a $90 increase for the owner of a $150,000 house.

The increase might have been even steeper were it not for city staff’s rediscovery of $4 million it borrowed a couple years ago while courting the U.S. Foods warehouse and distribution facility. Johnson said she was told the money, borrowed before she was on the council, was set aside to provide utility and road infrastructure to a parcel U.S. Foods was considering buying on Dry Hole Road. U.S. Foods ultimately decided to locate the facility near Buda.

Of the $4 million borrowed through certificates of obligation, half was specified for roads and half for water and waste water improvements. Council members are considering applying the street portion of the fund to the Dacy Lane project and to resurfacing downtown area streets.