Christensen: About those recent local tax increases
By way of background, after our City Council has increased property tax collections by around 50% over just the last four years while at the same time our population has grown by something like 3.5% a year.
And now on Sept. 8, City Council approved the 2021 budget. The budget includes an expansion of city spending and an increase of 4.7% in property tax collections. This is also an increase of 2.9% for the average homesteader in Waxahachie in these days of COVID, when many people are hurting economically. Our city is expanding spending in the latest budget to consume this latest tax increase.
I did want to point out that the approved property tax rate per $100 of assessed value was lowered. But because of rising assessments the average homesteader will see a 2.9% increase.
But our tax increases will be much higher for years to come from what was approved in City Council this year. A few weeks back Council approved a massive new bond package of $23 million. The bond includes, among other things, money for parks, water line and wastewater line replacements, and also includes $6.2 million for existing street repairs. I am of the opinion that the street repairs should be funded with general budget funds, not from a long term bond. So our residents will have to pay for the bond items for years to come.
As I was walking around someone asked me why the city can’t fund the ever expanding budget with revenue that comes from new property that comes online. Not a bad idea, but the City apparently has other plans. The City has increased property tax revenues by around $17 million over just the last four years, but apparently does not have the money to pay for needed street repairs without issuing new debt. Our City seems to have an insatiable appetite for our money.
And our bond liability has increased significantly over the last three years. Per the published City financial statements here are our long term liabilities in 2018 and 2019:
And 2020 with new bond Issue: $181,657,000
This is an increase in debt of 42% over three years. So not only did we get hit with another increase in property taxes this year on top of the heady increases in the proceeding four years, we will also have to pay off tens of millions, over $54 million since 2018, of debt interest and principle for years to come. And the City has more plans to spend more. For example, a new City Hall annex and restaurant and retail space for another $15 million. I believe that this rate of taxing, spending, and borrowing is not sustainable.
But it does not stop there. We also got hit with a 2.5% increase in our water rates. We did not need this increase. Water, Sewer and Garbage generated $1.9 million in profit in 2019 after a transfer of $5 million to the general fund for what the financial auditors described as “nonspecific administrative costs”.
Waxahachie is spending our money at an unprecedented pace with no end in sight. Ever expanding spending and borrowing may be expected to drive large tax increases for years to come unless we voters do something about it.
Paul Christenson is a candidate for City Council Place 1.