Sunday, August 13, 2023

FY2024 Budget Work Session

Overall, the city's proposed tax rate is not bad. The city suggests a 3.0 cent reduction in the tax rate. Our property taxes will still increase because of the higher property appraisals. We will still be paying more in taxes.

I’m always looking for where we are based on the no-new-revenue rate simply because I know the city has money coming in that is not included in the tax rate calculations. For example, the tax rate calculations do not include new construction and the two TIRZs. That means the city has a lot of extra money that is not reflected in that tax rate. When cities have extra money, that is money that can be used on pet projects. Excess fund balances have been another way this city has squirreled away money to fund certain expenditures. The city council came up with over $20M in excess fund balances to buy airport land after the failed 2015 airport bond.  

Here are a few things of note from the budget session (see the presentation here and the budget book here):

THE AIRPORT--The airport runway construction on the south end will continue. The northern segment of the airport runway is set to start early next year. 

Because our city council still has passenger airport service listed as a top priority, the city staff will continue spending money and energy to get Part 139 designation for passenger service. They will continue doing whatever they can to get a public-private partnership deal for passenger service. This is where extra money the city has can come in...

As mentioned in a previous post, a bond election for essential city services will have to happen in May of 2024 because some people didn’t plan for it with this last airport bond. 

The MEDC and MCDC are set to get about $23M each in sales tax money over the year. That is extra money for the airport, parks, economic development, etc.

A city council member suggested that more should be spent on low-income housing. Over the past few years, the city has used multiple sources and tools to establish programs that do not require general fund money.

Through the McKinney Housing Finance Corporation, we now have a new development for low-income (various targeted levels). The MHFC will use any money made through that co-development to put into more low-income housing co-developments. We will have another large apartment being built because of the Public Facilities Corporation that was just established. The city spent money establishing a community land trust. We also have the MEDC, the MCDC, and the TIRZ #1 which can all use their money to fund more low-income housing. The McKinney Housing Authority is also working on improving its properties and funding new ones. 

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