El Campo is projecting a $1.9 million loss on property values as budget talks get under way with sales tax revenue holding steady in the next fiscal year.
It’s unknown yet whether the anticipated loss will mean an increase in taxes for city residents at this point. This budget year, it took a 56.887 cent per $100 in taxable property tax rate to cover the city’s $10 million General Fund budget.
Next year’s levy will likely depend on a mixture of needs, requests and the final property values. For now, the city is waiting for the tax assessor-collector office’s computation on the effective rate, the tax rate needed to generate the same income based on the same property.
Sales tax rebates have been better than expected during the COVID-19 pandemic, but city staff isn’t expecting any windfall as the new normal continues.
“In fiscal year 2020, we budgeted a 5.5 percent increase in sales tax revenues. For fiscal year 2021, we are budgeting no increase or decrease in sales tax revenues,” City Finance Director Brittni Nanson told Council.
City staff is already recommending an increase on water and sewer rates in the city by lowering the minimum usage level from 3,000 gallons per month to 2,500 per month.
The change is anticipated to effect 361 of the city’s 5,296 account holders to generate $4,700 per month or $56,422 per year in revenue for the utility fund.
Nearby cities of Wharton, Bay City, Richmond and Rosenberg all use 2,000 gallons for the base rate.
No new positions are planned in next year’s city budget although there have been some reallocations including moving a Streets Department employee over to a newly-created Geographic Information Systems (GIS) division.
The city’s total budget is $21.41 million this fiscal year with costs outside the General Fund covered by fees. This includes water and sewer, EMS services, hotel and motel, technology and tax reinvestment zone.