Wednesday, October 2, 2024
RENO — Reno City Council raised the city’s tax rate by about 19 cents.
The tax rate set last year was 36.6173 cents per $100 valuation, and the council adopted a new tax rate of 55.6319 cents per $100 valuation during its Sept. 19 meeting.
This new tax rate is called the de minimis rate, and it is designed to give flexibility to smaller cities of 30,000 people or less. Typically, cities cannot go up on the tax rate by more than 3.5% without triggering an automatic election, but the de minimis rate allows for cities to bypass the cap and generate $500,000 more in tax revenue. However, voters may be able to petition for a tax rate election regarding adopted rates that are above the voter approval rate but below or equal to the de minimis rate, according to the Texas Comptroller’s website.
Mayor Hector Bas Jr. said the extra money produced by the increased rate will go toward employee raises, a new dump truck, a pothole patcher, janitorial services at city hall, repairs on Kay Lane and saving money in reserves, among other expenses. Bas also said the council and staff shifted around the payroll budget so there will be more money in the water fund for infrastructure upgrades. Without the increased tax rate, he said there isn’t much the city can do.
Council member Tod Siedell explained that earlier versions of the budget had a deficit of over $100,000, even after being cut down, with a lower rate. Siedell said the council was given two options on the tax rate: either decrease it by about two cents or increase it.
Mayor Pro Tem Shelli Swift said she was shocked by the proposed rate but confirmed it will allow the city to provide better pay to its employees.
“We don't need to compare ourselves with other cities that aren't our size, but some of our employees are not even making enough that any one of y'all would just get up and even go to work,” Swift said during the meeting. “Some of those needed to be brought up to some kind of a standard to keep them here. It just wasn't right what we were expecting out of them and not being able to pay them any kind of a decent amount, an hourly amount.”
With the new tax rate, Reno is positioned as lower than Azle’s rate of about 61 cents but higher than Springtown’s rate of about 50 cents. All three cities have increased their rates this year, though Reno has the highest rate increase of the three.
Swift pointed out that Reno’s tax rate has decreased since 2015, including by about 10 cents last year.
“The last few years, we just kept going down,” she said during the meeting. “While other cities are going up and while prices are going up, our tax rates kept going down.”
Kevin Lambert approached the council during the Sept. 19 meeting to ask questions about the proposed rate. He and his wife Bernadette are newcomers to Reno, having moved to the city in May. The couple is retired and spent their savings on their so-called “forever home” in what they thought was an affordable small town. The Lamberts bought their home in Reno knowing that infrastructure is lacking, but they felt like the low cost of living made up for that.
But the tax rate increase is making them think twice.
“If we had been informed about the financial instability, the financial management of this town, or the decisions that we're making here, the unpredictability of the water supply, we would have made alternative decisions,” Lambert said to the council.
For those with homes valued at half a million dollars, Lambert estimated tax bills will go up by about a thousand dollars.
“It's like, OK, this first one doesn't kill you, but if a city is able to do that without any citizen voter input, then what stops them from doing it next time and the next time?” Lambert said to The Tri-County Reporter.
Lambert said he would like to see the city work on finding alternate sources of revenue, boosting the city’s income and seeking grants, the latter of which can be sought out after the city finishes its audits. He would also like to see Reno solicit input from the community. Some council members said the city needs businesses to bring in sales tax money, but it’s difficult to recruit businesses without a public sewer system or stable water system.
Multiple council members also spoke in favor of eventually hiring a city administrator to guide Reno in the right direction.
“We are at the point we cannot afford not to have a city manager,” council member Joy Jenkins said. “Having a city manager should be a priority, and it has not been. It's been wishful thinking. We've got to change our mindset, that especially when we are talking about introducing a (Municipal Utility District) system to our city, that we have someone with some experience that can walk us through this and has the answers to help us grow in the right way where we can get some funding, keep our audits up to date and make the correct decisions instead of learning as we go.”
The council approved the tax rate and budget in three motions. Jenkins opposed them all, saying that the budget was incorrect. Swift also voted nay on the budget.
