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Tyler City Council adopts fiscal year 2021 budget

The proposed budget was first introduced at the Aug. 12 City Council meeting, with a public hearing at the Aug. 26. meeting.

TYLER, Texas — The Tyler City Council unanimously approved the adoption of the City of Tyler’s fiscal year 2021 budget proposal.

According to the ity, at a little more than 202 million, this budget is a 3% decrease in spending from the prior year.

“In my two decades of leading municipal governments, this has been the most difficult year that I’ve seen for budget administration and development,” said City Manager Edward Broussard.

The budget adopts the “no new revenue” rate of 25.9 cent, which is a .09 cent decrease from the prior year. With the adoption, the city will continue to keep the lowest tax rate for a city over 15,000 residents in the State of Texas.

According to the city, sales tax collections, which makes up 42 percent of the City’s general fund, remained stagnant, while revenues from Hotel Occupancy Tax are estimated to be 1.2 million below initial budget estimates for fiscal year 2020.

“We will absorb these shortfalls and continue to provide key services, as local governments will not receive State and Federal bail outs for our revenue losses on sales tax, hotel occupancy tax, and other revenue streams,” said Broussard.

The city will continue to move forward on key projects such as the modernization of the City’s traffic signals and will dedicate two cents of the property tax rate to the Quality Street Commitment fund to improve city-owned roadways.

The Capitol Improvement budget, which the city will spend $25.5 million on capitols projects paid for by the half-cent sales tax fund, will be adopted later.

The city is also proposing a change to the current water rate structure from declining to inclining, also known as a water conservation rate structure.

Under the current structure, the more water a customer uses the lower the unit cost. The new proposed water rate structure would mean the more water a customer uses the more each unit costs.

The City Water Utilities is the city’s largest enterprise fund, which means they do not receive tax revenue and must generate their funding through fees for services they provide.

The city will also be eligible to finance water and sewage projects through the Texas Water Development Board by adopting a water conservation rate structure.

“In 2017, the City of Tyler signed a Consent Decree with the Federal Government that mandates $250 million dollars of waste-water system improvements that must be implemented by April 2027,” said Broussard. “This will keep interest low on those bonded projects and save the rate payers money.”

If the budget is adopted, the new rates are expected to take effect in September 2021.

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