With the budget scheduled to be finalized in the coming weeks, Little Elm Town Manager Matt Mueller outlined his vision for the town during the town’s annual budget meeting Aug. 7.
In a four-year budget plan, Mueller said the proposed tax rate would remain the same as last fiscal year and outlined the emphasis for the town until 2024.
Little Elm’s tax rate is slated to remain at $0.6499 per $100 valuation. This sticks with trends in the town that have seen the tax rate decrease or stay the same since 2012. Although the rate will be unwavering, most residents should still expect an increase in their tax bill. The assessed valuation of homes has increased from 2018 to 2019. In 2018, Little Elm had an overall assessed valuation of $3.65 billion and in 2019 that number will jump to $4.1 billion, according to a draft of the budget. The revenue from property tax is expected to increase from $23.3 million to $25.3 million in 2019.
“We are proposing a flat tax rate this year. We felt it was appropriate to stay right where we were from last year. In the past couple of years we have brought it down slightly each year but there is a lot more uncertainty in property tax rates due to legislative changes. That is making us recommend it flat,” Mueller said.
The town staff was also excited for new projects the budget accounts for. The headliner is the Aquatic Center that broke ground Aug. 7. The overall budget this year increased from $78.2 million to $99.2 million, mostly due to the Aquatic Center. This project is the marquee item for the next five years, as officials expected and planned for. The price tag on this item will be approximately $23 million.
“(99.2 million) is a significant jump from last year. Obviously the big thing that is different from last year is the construction of the aquatic center that is in that number,” Mueller said. “We utilize the council’s strategic plan for the basis of prioritization. Every decision we make in those meetings is ‘is this something that is supported by the strategic plan?’”
There are other projects on the docket that will have significant effects on residents. The wastewater treatment plant expansion is “substantially complete” but will remain in the budget for this year. Officials expect the project to be “closed out in early 2020.” As of right now, the budget calls for the expansion of the facility to increase the capacity by 1 million gallons per day of water and 4 million gallons in total. This cost will come in at $9.6 million.
Two road projects will be at the forefront in the next year as well. With a new middle school on the way, French Settlement Road is set to get a $3 million remodel to accommodate new needs. King Road will also be under construction in a joint effort with Frisco, Hackberry and Denton County to connect it to Witt Road. This will cost about $1.5 million.
The town highlighted the overhaul in the budgeting process that makes Little Elm unique from many other towns. Mueller, since becoming town manager, has moved Little Elm away from a yearly budget and towards a four-year outlook and budgeting process. He, and other officials, have credited this change for the town being able to accommodate for larger projects.
“Say for the aquatics center for example. I don’t understand how we would have the comfort moving forward with that facility if all we knew was this year we could afford to build it. We are worried about what it costs to staff it in three years and what kind of revenue it brings in,” Mueller said. “If we add a staff member we know we can pay for them this year but we know we can afford them in year four and year five.”
One of the concerns coming into the night was the effect recent legislation, specifically Senate Bill 2 that limits property tax increases. Initially, there was some worry that this could minimize the revenue local governments could generate. Mueller indicated the effects were minimal and the town was on pace to meet all of its goals.
“(Staff) does an outstanding job forecasting revenue, and we take a very conservative approach to it. I think that’s why, even in spite of some of the legislative changes, we feel pretty good about our five year plan,” Mueller said.