The city of Edinburg officially lowered the property tax rate for the 2022-2023 fiscal year, lowering the rate for the first time since 1996, but with rising costs due to inflation, residents urge for a bigger tax break in the future.
The city council unanimously adopted a rate of 64 cents per $100 of valuation on Tuesday for the next fiscal year, down from the current tax rate of 68 cents, after hearing from a few residents during the required public hearing that was held on the tax rate.
One resident, Maria Cantu, thanked the council for proposing to lower the tax rate.
“That’s the first step to make housing more affordable,” Cantu said. “People are really suffering right now due to inflation, due to a lot of things that are happening right now.”
However, she urged the council to pressure state leaders to stop raising property values. She also asked for improvement in city services such as code enforcement.
Long-time resident Fern McClaugherty, who is a member of a local watchdog group and former candidate for city council, questioned how the council arrived at the 64 cent rate they had proposed.
She also expressed hope that they would look at bringing down the tax rate further.
“I would appreciate it if you all would keep trying to save the taxpayers money,” McClaugherty told the council.
Mayor Ramiro Garza Jr. told The Monitor Thursday a lot of factors were taken into consideration before they settled on the 64-cent tax rate.
“How we came about that is after evaluating all the information that was before us in terms of the projected revenue in terms of property taxes,” Garza said. “There’s been an increase in assessed valuations in the last three years, about 30%, 10% in just this last year citywide.”
Because property values assessed by the Hidalgo County Appraisal District have increased, the new tax rate, though technically lower, will still bring in more revenue next year than this year.
Garza said once they looked at the projected revenue from property taxes, which he said makes up about a third of the general fund, they also looked at sales tax growth, which in just one year grew by about 14%.
They also took into account the funds they city is receiving from the federal government through the American Rescue Plan Act, but also considered requests from all the departments to address certain needs — street improvements, drainage and parks.
“And, after meeting all those needs and making those calculations, we found that we’re able to do these four cents at this time,” Garza said. “At the end, the goal was providing tax relief to our residents and we’re just fortunate to be in a position to be able to do that at this time.”
Garza said the city’s growth also creates needs.
The city boasts 104,000 residents and has close to 80 subdivisions under development — 55 under construction and 25 under review by the city to be approved soon for construction.
“That represents about 3,700 new lots coming into our city. So the growth obviously is substantial, and so obviously we have to take that into account to address the needs that we have as we consider any kind of a tax relief,” Garza said.
He didn’t discount a lower tax rate in the future, but reiterated the city needed to ensure Edinburg is able to meet its needs, such as widening roadways, improving drainage, improving parks and continuing to fund its police and fire departments.
During Tuesday’s meeting, Councilman David White said they’re aware people in the community have been struggling, but providing substantial tax breaks to residents would have to be done in “baby steps.”
“When you start giving it back, you have to take little baby steps because we’ve got to think about our community because we can’t give it back and hurt the community at the same time,” White said. “We still have roads and bridges and floodwater and we still have everything else that comes about to run the city.
“So a little bit today and hopefully a little bit next year is the goal that we have,” White added. “I’d like to get us under 60 cents; it’d be something nice to do in the future. I don’t know if that’s obtainable, but as long as we’re here, we can keep looking at (it) and we can keep discussing it so the possibility’s there.”
Councilman Dan Diaz also chimed in, reiterating the hope to lower the tax rate but also the need to keep up with growth.
“There’s always going to be needs, so it’s just a delicate balance of trying to find where we want to be next year and the following years,” Diaz said.
RELATED READING:
EXPLAINER: Why maintaining same property tax rate causes homeowners to pay more
