The City of Round Rock published the proposed $525 million budget for the next fiscal year, beginning October 1, 2021. The theme is “Building Toward the Future” and you can see extensive information on this page of the City’s website including the development process and upcoming council review and approval.
Like many plans in our modern world, large municipal budgets are complicated and don’t fit well in a 280-character tweet. Recognizing this, the City has taken great effort to provide robust information on their website. The whole story is there for business leaders and taxpayers to see. You can “dig in to the details” as much as you like. We encourage business leaders and citizens alike to use these resources. Reasonable minds can differ about the details of any budget but it is clear that investments in infrastructure, providing city services, and civic amenities have are clear priorities this year.
Such efforts for transparency are not new for the City of Round Rock but rather represent a continuation of long-standing best practices for transparency. As of January of this year, Round Rock was one of only 12 cities in Texas that has earned and maintained all five financial Transparency Stars from the Texas Comptroller, recognizing local governments for high standards of online information in: Traditional Finances, Contracts and Procurement, Economic Development, and Debt Obligations.
Providing the complete information about your property tax rate and bill for the coming year is a demonstration of respect to the voters and taxpayers of the community, and the City Council’s commitment to transparency. Just like the annual budget for your business or your personal finances, this year is a mix of good news and less good news. The good news: the rate will go down. The property tax rate for FY 2022 will go down 4.2 cents, from $0.439 to $0.397 (per $100 of valuation). The less good news: an individual property tax bill may not be a lower amount due to increasing real property value. You can see more on this one page summary fact sheet provided by the city.
Whatever your property tax bill is this year, it is already lower than it otherwise would be because of the very positive impacts of economic development. This budget continues the half cent sales tax allocated to reduce property tax, which is estimated to save homeowners 13 cents on their property tax rate (about 25% savings!). Perhaps more importantly, single family residential (houses) amount to 92% of Round Rock’s total taxable property value; the remainder being commercial (businesses). Yet, single family residential property tax will generate only 55% of the total property tax collections under this budget, while businesses will represent 45%.
In my message to investors from May about why you should care about economic development I gave two reasons why; one reason being the opportunities economic development creates for people, and the other being the fact that property taxes are mitigated by property and sales tax paid by businesses. This year’s proposed budget is another example of that.