In September, the Heath City Council unanimously adopted a budget for the current Fiscal Year. The City’s budget is one of the most concrete expressions of public policy, as it sets forth the priorities for the upcoming fiscal year, which runs October 1, 2014, through September 30, 2015. The adopted budget will serve as a road map for where our funds are to be allocated, and as a check and balance system to make sure we are spending City funds properly. The overall budget is divided into 2 basic categories, the general fund and the utility fund.
This year’s budget calls for the City’s first ad valorem property tax increase in 22 years. The last time ad valorem taxes were raised in Heath was 1991, when Heath had just over 2,000 residents and 800 homes. Today, we have more than 7,400 residents and just over 2,750 homes. While no one wants taxes to increase, after extensive budget discussions and analysis by City Staff, the City Council determined that this tax increase was necessary in order to provide the quality of services our citizens desire while also investing for our common future.
This year’s budget calls for total general fund spending of approximately $5,328,000. One of the City’s most fundamental obligations is to provide police and fire protection, and this is reflected in our budget, with approximately 50% of our general fund being allocated to the Department of Public Safety. Other significant expenditures from the general fund include maintenance of the City’s streets, parks and trails and administrative operations.
This year’s budget calls for utility fund spending of approximately $5,688,850, up from $5,495,007 in the prior fiscal year. Utility fund expenditures are primarily for water, sewer and trash collection, and the budget increases this year are largely due to increased costs for water from the City’s water supplier that are passed along to residents. The rate increase in the 2014-2015 budget is 19 cents per 1,000 gallons of water used.
This year’s budget also includes increases in debt service due to city bond issuances in 2013 and 2014, the proceeds of which were used largely for our current capital improvements program. As a result of these bond issuances, we have had funds available to make necessary roadway, water, sewer and other infrastructure improvements throughout the City.
As a result, on the same night that the City Council approved the budget, it unanimously adopted an ad valorem property tax rate increase of 8.33-cents per $100 of assessed value from $0.3433 to $0.4266. The increase is distributed as follows:.
* 1 cent is to fund maintenance and operations (M&O), which includes Public Safety, Public Works and Administration. Numerous additions to the budget were responsive to the City’s growth and include two new part-time Public Safety Officers, a Permit Clerk and a Construction Inspector. The budget also includes an increase in funding for street repairs and maintenance. It is noteworthy that our M&O expenses were reduced by 1.5 cents in fiscal year 2012, and, therefore, our tax rate for M&O expenses will actually be less in this budget year than it was prior to fiscal year 2012.
*7.33 cents will fund debt service (I&S). The proceeds from City debt will be used to fund more than $20 million in capital improvement projects that benefit the entire City including street, trail and park improvements. You can view the CIP projects on an online map at www.heathtx.com under the Government menu.
According to the Rockwall County Appraisal District, the average taxable value of a home in Heath is $406,450. That means that the new tax rate will increase taxes $338.57 annually for the “average” home in Heath. Of that increase, $40.65 will go to M&O, and $297.92 will fund the debt service.
Finally, it is noteworthy that even with this tax increase, Heath’s ad valorem taxes are lower than those of three neighboring cities in Rockwall County. I can assure you that your City Council seeks to be good stewards of your tax dollars, and that we will always work to keep your taxes as low as possible, while also providing the services and infrastructure necessary to make Heath a premier city.
It’s hard to believe, but efforts to prepare the 2015-2016 budget will begin soon, and I encourage you to be a part of the process by attending City Council meetings and public hearings as they are announced.
In the meantime, feel free to contact me or any member of the City Council with questions or input. You can find a copy of the final budget for 2014-2015 and updated fee schedule at www.heathtx.com.
Lorne O. Liechty, Mayor