Gonzales City Council to set Ad Valorem Tax Rate tonight

GONZALES — Gonzales City Council is set to receive the City of Gonzales Proposed Operating Budget and establish the city's maximum Ad Valorem Tax Rate tonight.

At a budget planning workshop last month, the City of Gonzales Ad Valorem Tax Rate was at the top of discussion.

According to City Manager Sean Lally, the city has a current valuation of $369,533,040 – representing the value of all taxable properties in the City of Gonzales.

The city's current effective tax rate is $.1769, or $176.90 per $100,000 valuation.

"At our current tax rate, that brings us tax revenue of $653,703.95," Lally said.

During the budget workshop Lally presented council with a scale of possible tax increases ranging from 22 cents to 27.5 cents.

"I took the current value, times the effective tax rate to get a tax revenue table," Lally said. "It ranges from $803,771 to $1,004,014."

Lally said the scale of annual cost to residents ranges from $43.10 per $100,000 valuation, to $98.10 per $100,000 valuation. He said monthly cost to residents ranges from $3.59 per $100,000 valuation, to $8.18 per $100,000 valuation.

At the workshop, Councilman Dist. 3 Bobby O'Neal said – like anyone else – he does not like taxes but in looking at what has happened over the past several years something has to change.

"We have gone down. We are not going to be able to maintain," O'Neal said. "[Taxes are] going to have to be increased."

O'Neal also said when looking at the big picture of all the local taxing entities the city's rate is too low.

"The ISD is $1,050 per $100,000; the county is $567 per $100,000; the hospital is $280 per $100,000; and we are at $176.90 – and we provide infrastructure for the schools, the hospital and everyone else in town," Lally said. "So, you have to ask yourself: 'Are we doing due diligence by keeping the tax rate low?'."

During the workshop Gonzales Mayor Connie Kacir said the average across Texas for a city property tax rate is 41 cents. She also reminded council members in attendance, Texas Municipal League advises 40 percent of a municipality's budget should be derived from ad valorem taxes.

"That's how you operate a city and operate it well," Kacir said.

Kacir said Gonzales operates at about 10 percent.

According to Kacir, in the year 2000 the city's ad valorem tax rate was 33.3377 – just under 34 cents.

"We were very close to being average – 17 years ago." Kacir said. "We have continued to drop, thus has our level of services and our ability to take care of our infrastructure."

Kacir mentioned the city has deferred maintenance and buying equipment for the jobs that need to be done.

Because of Senate Bill 2 – designed to cap taxing – it appears that this year will be the city's last opportunity to try to make a big change in the best interest of residents and be able to care for the city's infrastructure according to Kacir.

"If we only have one shot, we need to go for the big one," Councilman Dist. 2 Tommy Schurig said.

Kacir said an increase would not be a crippling or catastrophic event and the city could come out with $2 million in revenues and use half toward neglected infrastructure, equipment and deferred maintenance, then put residual income into retained earnings to start recapitalizing the city.

Kacir reminded council that if the city had retained earnings, rather than making transfers to fund operations the city would not have had to take out a $1.7 million bond for repairs at the hydroelectric dam.

"You can put all the plans in the world together but if you cannot fund it, it's not a plan," Lally said

Under resolutions council will discuss and consider authorizing the city manager, Sean Lally, to execute an amendment to Guadalupe Valley Electric Cooperative Inc.'s electric line transmission easement, located on parcel 738.

Council will also discuss and consider authorizing Lally to: execute a Right of Way Agreement with GVEC, for property on East Avenue/FM 532; execute a transmission line easement with GVEC on East Avenue/FM 532; and execute a Right of Way Easement with GVEC at JB Wells Park.

Other resolution considerations include: approving a quote of $57,626 from Hill Country Tech for server upgrades and licensing; approval of Gonzales Convention and Visitors Bureau to fund up to $5,000 to Gonzales Memorial Museum; acknowledge receipt of the City of Gonzales Proposed Operating Budget.

Under ordinances council is set to amend the code on Airplane hangar rentals.

Under Board and Staff Reports, council is to receive the city Financial Report as well as the Second Quarter Investment Report.

Council is expected to have an executive session over personnel matters: City Manager Mid-Year Evaluation. Council will reconvene in open session to discuss action, if there is to be any.

Gonzales City Council meets for its regularly-scheduled monthly meeting at 6 p.m. tonight, Tuesday, Aug. 1, at Gonzales Municipal Building 820 St. Joseph St., in council chambers.