Highland Village Holds the Line on Taxes

Pam King September 11, 2009

Published 09/10/2009 - 12:21 p.m. CST

Finance Director Kenneth Heerman and Mayor Costa indicating that Highland Village is #1.

Without audience or fanfare but with appreciation to staff for its commitment to run lean, the Highland Village City Council unanimously approved the Fiscal Year 2009-2010 budget at the same rate its been for 17 of the last 20 years: $ .56963 per $ 100 of valuation. Were still where we were in 1990, said Mayor Dianne Costa. The single most important thing council does is to work on the city budget and this budget reflects our conservative view on city spending. In his briefing to council, City Manager Michael Leavitt acknowledged the Highland Village City Council and staff succeeded in maintaining the tax rate at $ .56963 from 1990 to 1997. For a period of three years, the rate rose to $ .59 then dropped back to $ . 56963 in 2001, where it will remain for this next year. The budget process began in earnest in May of this year where, with councils guidance, a list of essential budget considerations was developed. That draft budget has been posted for public review and comment since August 21. Leavitt says he knows of no comments or questions. Based on sales and property tax values, the five-year forecast for the citys total market value is $1.68 billion, according to Leavitt. Property tax assessed value increased by 2.5% and the city is realizing a 2.17% increase in revenues. To balance the slim but positive economic increases in revenue, no government growth is anticipated in the

coming year, there was a $1 million reduction in non-payroll, departmental budgets and there will be no salary increases, CPI or merit increases, across the board. Finance Director Kenneth Heerman noted the citys stable financial condition is the result of having succeeded in building up adequate reserves and diversifying development, by adding retail and commercial development to residential property development. Highland Village is a small community with limited sales tax revenue, Heerman said, but the percentage of sales tax revenue has doubled in the last few years, even in this economy. The increased sales tax revenue we have realized is the equivalent of raising the tax rate by several cents. We took a conservative approach to the budget this year, Heerman said. Its been important to build up our balances and position ourselves, while we wait for the sales tax revenue with think the retail development will generate. More importantly, Heerman continued, People seem relieved with the services the city continues to provide. We get a lot of positive feedback about the efficient use of tax dollars. Council members and the mayor expressed their appreciation to staff. In Mayor Costas words, We are eternally grateful for the hard work, staff dedication and patience that brought us a great budget that demonstrates our conservative manner in handling City business and its governance. In related business, the Finance Director explained to council that the local government code requires them to acknowledge a property tax revenue increase even when the tax rate has not changed. If we raise more tax dollars than last year, Heerman said, a separate vote of council is required. Because the city has experienced some growth in assessed valuation, its revenue will increase compared to last year. Council unanimously voted to acknowledge the increase. In a show of support for its city staff, council unanimously approved an Authorized Employee Leave Day, adding one additional paid day to the citys employee benefits schedule. According to Leavitt, This keeps us competitive in the market (of municipal employee benefits) and is a good recruitment tool. We were actually one day off, so this remedies that. We will encourage employees to take leave on their birthday, rather than bank it. Mayor Costa added, We thought this might be a good way to thank our employees, especially in light of the fact there will be not raises or increases this year, based on the economic time. Council unanimously approved a CoServ Gas rate increase negotiated by a coalition of 19 other cities after CoServ filed its intent to raise rates by 19.7% in 2008. City Attorney Dorothy Palumbo said the coalition thought the negotiated settlement increase of $1.3

million was justified, after it had appealed the original increase. The property at 828 Highland Village Road, formerly the residence of Annette W. Testa and a blight on an entryway to Highland Village, according to Leavitt, was approved for foreclosure and sale proceedings by the majority of Council. Ms. Wilcox voted against. Council action also authorized a $48,515.73 settlement (plus interest) to reimburse enforcement and code compliance liens against the property. Mayor Costa said councils decision was a, good move for citizens. When I visited with Ms. Testa, the Mayor said, I was very concerned over the number of safety issues.