During its regular meeting Tuesday, the Boyd city council approved a proposed property tax rate of 69 cents per $100 valuation. The council will hold a public hearing and vote to approve the proposed rate at its regular meeting Tuesday, Sept. 3 at 6 p.m. ARCHIVES
The property tax rate in the city of Boyd could be on the rise in the 2024-25 fiscal year.
During its regular meeting Tuesday, the council voted unanimously to go forward with a 69-cent proposed property tax rate, an almost 3-cent increase from its $0.660778 rate set last year.
Of the proposed amount, $0.469180 will be used for maintenance and operation, while $0.220820 is for debt interest and sinking.
"Our debt service rate has steadily climbed because of the large note we borrowed the last few years," Boyd City Administrator Dwayne Taylor said. "Each year with the I&S rate rising, the portion of the tax rate we can use for maintenance and operation has also dropped... We all know operational costs usually trend up and not down, so we're going to have to start monitoring our debt rate and operation rate so that the debt rate doesn't force our tax rate up higher than anyone's comfortable setting."
The proposed increase will cause the average tax bill to rise $111 to $2,635 based on the city's median home value of $382,000, which rose $8,000 from 2023. There will be no tax increase above the frozen level on the homestead of taxpayers 65 years old or older.
Taylor informed council members that the proposed rate will raise more revenue than last year's rate by $245,437, representing a 16.2 percent increase. The property tax revenue to be raised from new property added to the city's 2024-25 fiscal year tax roll is $336,596.
"Because of the losses in other areas, it actually offsets," Taylor said. "You'll see a big collection on homes we didn't have last year, but really, your true revenue is only around $245,000, if the council adopts the 69-cent rate."
Boyd mayor Rodney Holmes said the figures actually show the city is decreasing taxes on its residents.
"The budget we're looking at is like $235,000 more than it was last year," Holmes said. "But our new construction taxes was over $300,000. Technically, we're lowering taxes $90,000, but it doesn't look like it on paper."
The council considered increasing the property tax rate to the maximum of the voter-approval tax rate of $0.767431 per $100 valuation. However, Taylor shared with council members that the city's proposed budget does not require the uptick in the property tax rate.
"Our budget requests don't reflect the rate of that amount," he said. "Obviously, staff is not requesting or recommending we set the rate anywhere near that amount this year. The current budget that we have as of today reflects a rate just over 68 cents... Between now and September, if the council chose to set a tax rate lower than 69 cents, you can do completely that without any issue. However, if you set the rate, that is the highest tax rate you can adopt this year."
The city's no-new-revenue rate, previously known as the effective tax rate, rose over 21 cents from $0.529690 to $0.732618. Additionally, the de minimus rate, which represents the highest the city council can raise the property tax rate, jumped by about 16 cents -- from $0.786260 to $0.945714.
"There's a lot of factors that go into that drastic change," Taylor said. "First off, we lost $18 million in mineral valuation. The TIRZ (Tax Increment Reinvestment Zone) for Springhill [South] increased over $18 million, so that separates it. Our frozen levy for homeowners that are 65 years old or disabled increased over $30 million. While we had a lot of new construction [$48,782,103], those things really offset -- it made the tax rates a lot different than we've been used to in the past."
Boyd's 2024 certified taxable value was $302,904,430. However, after an $18,609,564 loss from tax increment financing and a $30,187,503 loss from current tax ceilings (frozen levies), the city's total taxable value is $254,107,363.
The council will hold a public hearing for the 2024-25 fiscal year budget during a special-called meeting 6 p.m. Tuesday, Aug. 27. A public hearing for the proposed tax rate will be held during the council's regular meeting 6 p.m. Tuesday, September 3. Both hearings will be held at Boyd Community Center.
In other business, the council unanimously approved the final plat for Springhill South's third phase, which includes 199 homes and three homeowner association lots on 44.8 acres. The subdivision, located on Cemetery Road near Boyd High School, is being built in four phases, which will bring a total of 674 total homes to the city upon completion.
According to Taylor, the infrastructure for the third phase, which includes water and sewer, are already in place. Taylor said the streets are at about 90 percent completed, with minor tie-in work and 911 addressing still to be done. He estimated that the final items will be done within the next few months.
Council members also approved ordinances ordering a special election for a governmental change and the legal sale of all alcoholic beverages including mixed drinks for the Tuesday, November 5 general election.
Last month, city officials announced the two measures had gathered enough signatures that were verified by the Wise County Elections Office to advance to the Election Day ballot. A total of 162 verified signatures were gathered for the alcohol measure, while the governmental change measure garnered 21 signatures.
While voters approved the sale of beer and wine 73.9 percent to 26.1 percent in 2016, the proposed alcohol measure will allow restaurants and liquor "package" stores to sell all alcoholic beverages.
The governmental change will cause the city to abandon its current city administrator position and hire a city manager, if approved by voters.
Council members also approved a contract renewal between Boyd Police Department and All-American Towing, as well as an agreement with Aoka Engineering for third-party inspections for the city.