The city of Edinburg is on the verge of lowering its property tax rate for the first time in 26 years.
The city council set a proposal of 64 cents per $100 of valuation for the 2022-2023 fiscal year during a city council meeting last week which, if adopted, would mark the first time the city has lowered their property tax rate since 1996, according to the city.
The 64-cent rate is a reduction from the city’s current tax rate which is 68 cents per $100 of valuation.
Based on property values as assessed by the Hidalgo County Appraisal District, for the city to bring in the same amount of revenue next year as they’re projected to bring in this year, the property tax rate would have to be at 62.56 cents, according to a description of the possible proposals included in the meeting agenda packet.
This rate is known as the no new revenue tax rate, previously called the effective rate.
The 62.56-cent no new revenue tax rate is projected to bring in $37,499,085 to the city.
The voter approval tax rate, formerly known ast the rollback rate, is 70.95 cents of $100 of valuation. Adopting the voter approval rate or rate higher than that, would require voter approval.
The 70.95 voter approval rate would levy $42,181,713 for the city.
Even though the city is lowering the rate, they are still required to hold a public hearing since it is higher than the no new revenue rate.
In 2019, the city voted to raise the property tax rate from 63.5 to the current 68-cent rate, an increase in 4.5 cents, according to data from the Texas Comptroller’s website.
If they were to bring it back down to 64 cents, that would be a decrease of 4 cents.
“It’s something that I had proposed with the council and I think part of it is we’ve been growing quite rapidly and our valuations have shown that,” said Mayor Ramiro Sarabia on why the council decided to lower the rate.
“I just felt that with the growth that we’re having and some of the funds that we’re getting from the government at this point through (the American Rescue Plan Act), that it was only right for us to provide some tax relief at this time,” Garza added. “Looking at the budget … we’re looking to account for a lot of the needs that we have, we just thought it was important that we provided the residents some tax relief while at the same time, addressing some of our needs that we have in our city.”
Those needs include street improvements for which the city is currently budgeting approximately $3 million in next year’s budget.
During the city council meeting last week Finance Director Dagoberto Soto Jr. assured the council that even with the lower tax rate, he calculated the city would still be able to cover the city’s needs including future growth.
“If you look at the rate that we’re looking to set, there’s still an increase in revenue that the city’s getting, even reducing it by 4 cents,” Garza said. “So really at this point, we have a lot of construction taking place, we’re adding some personnel as well so I don’t believe that we’ve made any adjustments just because we’re reducing the tax rate.”
Garza encouraged the public to attend a public hearing on the tax rate that will be held Tuesday. The hearing will be at city hall, located at 415 W. University Drive, and begin at 6 p.m.
The meeting will also be streamed live on the city website, cityofedinburg.com, and on Spectrum Channel 1300.
