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City of Peñitas proposes 2.5 cent tax increase

City-of-Penitas-logoPEÑITAS—The City of Peñitas is scheduled to hold two public hearings on a proposed tax rate increase. The council is proposing to raise the city tax rate from $0.41 to $0.4345 per $100, increasing the average annual city tax bill by $17.35 to $353.60. The average taxable value of a home in Peñitas has dropped to $81,386 from last year’s $82,012 average valuation.

Peñitas City Manager Oscar Cuellar explained the Hidalgo County Appraisal District holds the responsibility of estimating the taxable value of a property. Last year, the average amount of city taxes paid by a Peñitas homeowner was $336.25.

Cuellar said though the county handles the property appraisals, there is a possibility the property value saw an almost $1,000 drop due to the amount of colonias that were adopted through the city’s annexation. A total of $24 million worth of real estate has been added within the city’s limits.

The city manager explained, during the tax rate increase last year the council pushed for a nine to 10 cent tax increase. He said the community expressed at public hearings they didn’t want that high of a tax increase, so they brought the tax increase down to four cents.

Cuellar said the commission has not discussed where the extra revenues will go if the tax increase is approved. He did say though that some of the revenue would go to the repayment of the U.S. Department of Agriculture loans for building the $18 million wastewater treatment system just completed.

The USDA helped Peñitas by funding the project through part grant funding and part loans.

“ Now we are asking for about two or two and a half cents,” Cuellar said. “We are making money on our sewer plant. …Every month we are adding more customers.”

Though the sewer plant just opened this year, it is moving quickly on adding customers each month, according to the city manager. He said real revenue wouldn’t be seen until the city hits the maximum amount of customers.

The first public hearing on the proposed tax increase will be held at 6 p.m., Sept. 4 at the temporary Peñitas Public Library building located at 1320 S. Main Street. The second hearing will be held on Sept. 10 at the same time and place.

Contact Andrielle Figueroa at This e-mail address is being protected from spambots. You need JavaScript enabled to view it

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