Property owners in Fort Worth will see their property tax rate drop by two cents but they are still likely to pay slightly more next year due to soaring appraisal values.
The City Council approved the Fiscal Year 2019 budget and dropped the tax rate from 80.5 cents per $100 valuation to 78.5 cents per $100 valuation.
The owner of a home valued at $200,000 with a homestead exemption would pay $1,256. The effective tax rate is a 0.31 percent increase.
But the passage of the budget occurs without a fix for the troubled pension system, which is facing a $1.6 billion shortfall.
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If nothing is done to shore up the Fort Worth Employee’s Retirement Fund, it could run out of money by 2048.
Earlier this month, the city upped its proposal, increasing its contribution from $92 million to $110.7 million annually and preserving the cost-of-living adjustment (also known as the COLA) for retirees. But it would cut the cost of the COLA from 2 percent to 1 percent.
The leadership of both the Fort Worth Police Officers Association and the Fort Worth Professional Firefighters Local 440 said they couldn’t support this latest proposal because it would impact the cost of living adjustment for retirees.
Talks were ongoing last week but were halted after Fort Worth Police officer Garrett Hull was shot and killed in the line of duty. His funeral is scheduled for Friday.
With his tragic death, no one — the City Council or employee groups — was in a mindset to continue the pension debate.
Mayor Betsy Price said Tuesday they have not set a date for taking up the issue.
Complicating matters is whatever pension fix is eventually approved will be subject to an employee vote that requires the majority of all employees to approve — not just those who cast ballots.
The city has 4,009 general employees with 2,082 hired since 2011. There are 1,710 police officers and 924 firefighters.
If an employee vote failed, the retirement fund could be headed to Austin where both Dallas and Houston ended up having the state dictate how to shore up their troubled retirement systems.
While the pension fix will wait for another day, the City Council approved a total operating budget of $1,720,977,226 for Fiscal Year 2019, which begins on Oct. 1.
The two largest pieces of the budget include the general fund at $674,613,915 and enterprise funds of $582,619,705, the majority of which is the water utility fund.
To keep the 2-cent property tax cut, the city will cut the $674 million general fund by $3.4 million. Those cuts won’t be found immediately but will be identified over the next six to nine months, said City Manager David Cooke.
The budget also includes $5.5 million for structural fixes in the police department budget and $10.2 million that will serve as a placeholder for a potential pension fix.
This report contains information from the Star-Telegram archives.