The reduction could be one of several items the city plans to enact, which could include the creation of a storm water utility fee, within its estimated $79.2 million budget for the coming year.
Kyle Mayor Todd Webster said the one-cent decrease was created after the city added its storm drainage and flood risk mitigation fee into the budget.
The fee, which is a $3 per month charge for residential and commercial properties, would generate enough revenue so that the storm water utility could fund “a number of employees,” Webster said.
In turn, City Manager Scott Sellers moved several employees, who had been funded by general fund monies, to the storm water utility. Webster said Sellers used the cost savings to cut the property tax rate by a penny.
Webster said the stormwater fee is needed, as it would go toward mitigating flood and drainage issues across the city. But he added if council nixes the fee, the city’s property tax rate would remain at last year’s rate of .5848 per $100 valuation.
“If we don’t learn from last Halloween’s flood, shame on us,” Webster said. “It’s the right thing to do from a policy standpoint.”
Roughly $37 million would go toward the city’s Capital Improvement Projects this fiscal year. Included in that cost are the final four of Kyle’s 2013 Road Bond projects, along with over $10 million in wastewater line improvements across the city.
Kyle is also planning to schedule out payments of the proposed expansion of its wastewater treatment plant, which is projected to cost $17 million.
Webster believes the city’s new development would bring in enough revenue this fiscal year to cover the expansion, which would see the plant increase capacity from 3 to 4.5 million gallons per day.
The city is anticipating $8 million from five new developments, including the Anthem Development near Mountain City, the Crosswinds Municipal Utility District, and a proposed Walton Development.
Webster said the city’s goal is to “get things paid for with private sector dollars” without the need to borrow.
Should an agreement not be finalized with all parties, Webster said the city may be forced to issue general obligation or certificate of obligation bonds to cover the cost.
“We’re taking all of these additional capacity issues and getting money up front and having to piecemeal this house-by-house,” Webster said.
Kyle’s budget also calls for a $4 million reduction in the city’s debt. Refinancing previous bonds, along with not adding any new obligations led to the reduction, Webster said.
One additional component that could be added to Kyle’s budget could be a possible pay increase for Kyle Police officers, which was requested in a letter to council by the Kyle Police Employee’s Assocation (KPEA) in order to maintain parity with other jurisdictions, Webster said.
Webster was unable to provide an in-depth comment due to the city’s meet and confer agreement with the police department.
While Kyle isn’t proposing a water or wastewater increase in the FY 17 budget, Webster discussed the possibility of increasing water rates to accommodate future infrastructure from the Hays Caldwell Public Utility Agency.
Kyle would have to pay a $55 million share in debt in the future to pay for the HCPUA’s 45-mile pipeline project. Webster estimated a $21- to $25-increase in water rates for Kyle citizens, with the city potentially beginning to contemplate a rate structure in the future.
Webster said no decision has been made on the possibility of increasing water rates and he wanted it to be an “active discussion.”
