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Last Friday, Aug. 28, the city of Mission held a special meeting to discuss the budget and tax rate for the 2020-2021 fiscal year. Council tabled the tax rate discussion during the regular city council meeting, which was also last week.
City Manager Randy Perez presented the preliminary budget again to council so they could see the comparisons different tax rates would have. Following the budget discussion, the council took a public vote on the tax rate. Currently, the tax rate in the city of Mission is 0.5212 per $100 valuation, and are considering either keeping the rate the same, or raising it to 0.5299 or 0.5490 (the maximum the city can raise the rate without triggering an election).
“With the 0.5490 we would generate an additional $1.1 million based on this calculation,” Perez said. “On the 0.5299, which is the three and a half percent [increase], the additional revenue would be $514,346.”
In terms of the property tax revenue projections at 100 percent, Perez said keeping the rate the same would generate $23.2 million. The 0.5299 rate would generate $24.8 million, and the 0.5490 rate would generate $25.7 million.
Perez also presented on how the potential pay raises for city employees (including the police and fire departments) would impact the budget based on each tax rate scenario. Perez noted that no action would be taken on how the adjustments would impact the general fund during the special meeting.
Perez said he would recommend the 0.5490 tax rate. Council member Jessica Ortega-Ochoa asked if they went with the maximum increase, Perez would be able to keep the rate the same for the next two fiscal years.
“That’s all going to depend on the overall operations,” Perez said. “One of the things that we need to consider is our city growth throughout the year, that plays a big part. If we do have a substantial amount of growth in the city, that offsets any type of increase. However, if we want to plan for projects, major projects out of operating funds, at that point we would look at what funds are available. There’s a lot of factors that play into that.”
Perez said because the city has one of the lowest tax rates comparable to local municipalities, Mission needs the additional tax revenue to sustain the services they currently offer and improve the city. Mayor Armando O’caña said he would be voting for the 0.5490 tax rate, and while he likes the idea of freezing the subsequent rate for two to three years as Ortega-Ochoa suggested, he didn’t know if it was too long of a time.
“I kind of want to compromise and raise the taxes this year and keep the 0.5490 for the two years,” O’caña said. “But we can’t predict the future. This year we had the pandemic, the hurricane, 2020 has been a very very different year.”
Mayor Pro-Tem Norie Gonzalez Garza voted for a tax rate of 0.5299.
“I’m comfortable with that three percent,” Gonzalez Garza said. “I know that it’s too hard to say that we’re not going to increase taxes in the next couple of years because we don’t know what the future holds for us. I think we’ll have a healthier fund balance with this tax rate.”
Council member Ruben Plata voted for 0.5299 as well. Council member Alberto Vela also voted for 0.5299, citing he believes they should take a steady, slow approach to raising taxes.
Ortega-Ochoa voted with the city recommendation of 0.5490. The final record vote was 0.5299 with a 3-2 decision from the council.
Following their discussion, the city council took a record vote on the proposed 2020-2021 tax rate. Perez clarified that they won’t adopt the official tax rate until prior to approving the budget following the public hearing. The proposed rate can be decreased following the record vote, but not raised.
Council set the public hearing for the 2020 tax rate and budget on Sept. 14, 2020.