Reacting to the Hays County Emergency Services District No. 5 (ESD 5) calling of a Sales and Use Tax election in the unincorporated areas of Kyle, council members sanctioned a massive expansion of the city in an effort to minimize the possibility of losing out on sales tax revenues in its extra-territorial jurisdiction (ETJ).
ESD 5 commissioners rejected an interlocal agreement on July 24 that would have granted 100 percent of sales tax revenues to Kyle that were produced in areas the city annexed in the future. Subsequently, ESD 5 commissioners called for a 0.5 percent Sales and Use Tax election in the city’s ETJ, though the board could have asked for the whole 1.5 percent sales tax up for grabs.
Hoping to retain sales tax revenues produced in future growth corridors in Kyle’s ETJ, council members, in split votes last week, approved the annexation of over 3,000 acres scattered along the city’s borders.
