Huntsville Finance Director Steve Ritter released a proposed city budget for fiscal year 2021-22 that calls for more than $70 million in operations spending, based on one of the largest increases in sales tax revenues in recent years.
The budget proposed to the Huntsville City Council on Tuesday allocates $70.9 million of expenditures to the city’s key funds. Additional expenses for capital projects are expected to be added next month.
“This is the kickoff to our annual budget process to give a snapshot of where we are at in the process,” city manager Aron Kulhavy noted. “We are still working on the budget and have quite a ways to go before the recommended budget is presented to council for consideration.”
The city's projected state sales tax revenues are projected to be $10.5 million. Ritter said that based on historical growth, that’s a 13.6% increase on the city's projected sales tax revenues for fiscal year 2021. According to the Texas Comptroller’s Office, the city has been allocated over $6.1 million through the first six months of 2021.
City leaders are also estimating a proposed property tax rate of 30.73 cents per $100 valuation, a slight increase from the current adopted rate and a penny more than the projected no-new-revenue rate. The proposed rate is expected to generate over $5.7 million — nearly 8% more than what was allocated in the current budget.
Because tax figures are preliminary, city officials said that projected revenues will not be finalized until the end of the month, when the appraisal district can provide final tax rate calculations.
“The one-cent increase will be utilized to cover the cost of two additional firefighters, which has a total expense of about $160,000,” Ritter said.
The proposed budget expenses are highlighted by both merit and market adjustment increases for most city employees. Other expenditure increases include a 12% bump in street maintenance and $350,000 in new capital improvement projects.
City Council members will hold a workshop for capital projects with additional proposals on Aug. 3. The council will then hold a public hearing on Aug. 17 about the tax rate and on Sept. 7 for the recommended budget.
City authorizes engineering contract for expanded sewer lines
With a unanimous decision, the City Council authorized a $299,800 contract with Strand Associates for professional engineering services to replace 9,100 linear feet of sewer line.
The estimated $3 million project is scheduled to replace and upgrade sewer lines from a manhole north of Huntsville High School on FM 2821 to a manhole near El Road.
City leaders say that the project is necessary to handle the load of planned developments.
“This area can not handle large development right now, because the sewer lines are so old and almost at full capacity,” Kulhavy said. “This area has been underutilized by our city, and I think that this sewer line upgrade will be necessary for the scheduled developments around Huntsville High School.”
Council discusses HOT Fund Board proposal
City Council postponed any action upon the first reading of an ordinance that would reconfigure the city’s hotel/ motel occupancy tax board. City leaders have sought to expand the current board by an additional four members, while also asking the board to advise city staff on the promotion of tourism.
“The HOT fund board is already part of the tourism department, so it just made sense to expand,” tourism manager Tracy Rikard told the council.
The current HOT Fund Board is one of 13 advisory boards or commissions that provide recommendations and oversight to city leaders and the City Council.
The next scheduled meeting of the Huntsville City Council is set for Aug. 3.