Mayor David Cook challenged city staff to cut $900,000 out of the budget to offer homeowners and businesses relief from rising property values.
The request comes two weeks before the City Council is set to vote on the 2019 fiscal year budget on Sept. 10, 11 and 12. That means city staff will have to scramble fast to find places to cut.
The council faces increased pressure from residents who are being priced out of their homes as appraisals continue to go up.
Mansfield has maintained its tax rate at 71 cents per $100 of assessed value for 10 consecutive years and had proposed to keep that tax rate for the next fiscal year, which starts in October.
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Revenues from city property taxes will increase an estimated $3.3 million with $2.4 million of that coming from new construction. That means about $900,000 comes from increased property appraisals on existing homes and businesses.
“I would like to challenge staff to find a way to eliminate $900,000,” Cook told city staff at the Aug. 27 meeting. “We need property tax relief in the state of Texas. Our legislature and our government has made it a priority.”
Several council members credited City Manager Clayton Chandler and city staff for running a tight ship, so finding places to cut won’t be easy.
Department heads started with a zero-based budget months ago where city staff had to justify every expense. It had more than 13,400 individual line items.
Cook suggested that the city consider not giving merit raises this year, a savings of about $768,957. Chandler has said in previous meetings that competitive wages are needed to attract and keep talented employees.
Chandler said the city needs to hire six firefighters and four police officers in addition to buying the land and starting design on a fifth fire station.
“We know we’re building that fire station and we need to staff it,” Chandler said. “We’re going to need more money for this growing city, there’s no doubt about it. It’s going to cost money to deal with those services.”
Cook’s 11th-hour call to trim the budget comes just two weeks after Councilman Mike Leyman asked if anyone else on the council had interest in reducing the tax rate. No one seconded his motion at that time.
Councilman Terry Moore suggested having bond elections where voters can decide whether they want certain capital projects rather than issuing general obligation bonds. He also favored an exemption that allows homeowners to shave a portion of the appraised value before calculating their taxes.
Councilman Casey Lewis said he would support a homestead exemption as well.
Cook countered that having bond elections would still come out of the same 71-cent property tax rate so it doesn’t offer relief.
Long term, Mansfield needs to increase its sales tax by bringing more businesses to town, Moore said. The Shops at Broad will add several new businesses over the next year, with Academy Sports + Outdoors and At Home opening soon. Mansfield will set a record for sales tax collections next year.
“We’ve got a ways to go on sales tax but hopefully sales tax takes a larger percentage,” Moore said.
During the public hearing for the budget, Tamera Bounds, who ran unsuccessfully for council in May, presented an alternative proposal that means less debt for police expenses.
She’d like to see Mansfield start a Crime Control District funded by sales tax to pay for police equipment and facilities. She recommended allocating a portion of the Mansfield Economic Development Corp.’s half-cent sales tax to pay for police needs. Mansfield could split the half-cent sales tax between the new Crime Control District and the MEDC so each gets one-fourth of a penny.
“We are growing with 18 other big employers and another hospital coming,” Bounds said. “We do not necessarily depend on MEDC to bring in the big guns. Mansfield has grown so much beyond this 1992 system and has established new and more meaningful ways, that weren’t available to us in 1992, to support and incentivize growth. We are a hot spot for growth.”