A group of Flower Mound residents and town employees filled the council chambers Tuesday night wearing maroon T-shirts that read “We Support #FloMoEmployees.
This comes as the Town Council is nearing the end of 2019-20 budget discussions, which at times has included suggestions on cuts that would impact town staff.
In a list of suggested budget cuts sent to Town Manager Jimmy Stathatos last month, Mayor Pro Tem Sandeep Sharma suggested cutting the proposed compensation package by 30 percent. Councilman Jim Pierson sent a list of categories to be considered to trim the budget. Those items included staff benefits, merit pay increases and 2-to-1 retirement plan contributions.
For the second meeting in a row, residents voiced opposition to cuts that they said would negatively affect town employees.
“This has been done in the past, and there are still scars from the damage it caused,” said Josh Acker, president of the Flower Mound Police Association. “There were employees who left the town because of these cuts. While I'm not claiming a mass exodus, it has had long-lasting effects on morale and job satisfaction.”
After the meeting, Pierson said he had asked early on about performance evaluations as it relates to employee salaries.
“That way the control is in their hands without having to take away the security of getting a raise,” Pierson said.
He said Stathatos told him that would not work for first responders and certain other employees. He said there was also push back on the suggestion of not offering 3-percent merit increases.
“All I was doing was thinking of ideas to look at,” Pierson said.
After the meeting, Sharma said he never said he favored cutting compensation but that he suggested a performance-based salary increase for employees rather than 3-percent merit increases across the board.
While Sharma said he still thinks that’s the best way to reward the hardest-working employees, Sharma said he is OK with a 3-percent merit increase.
“If the town manager and staff feel that’s the best way to get the most out of them, they’re the ones responsible for their staff,” Sharma said.
As far as retirement contributions, Sharma said he had asked if providing twice as much as the employee is necessary.
“(The staff) gave me data that 100 percent of our comparison cities give 2-1,” Sharma said. “With that, I’m OK with that.”
When asked if town employees need to be concerned about retirement contributions, medical contributions or merit increases, Pierson said, “They never did.”
Mayor Steve Dixon said he wants lower pay increases and reduced benefits off the table when the council votes on the budget Sept. 16.
Residents also opposed Pierson's request to lower the tax rate. In a previous budget workshop Pierson directed the staff to find a way to cut $7 million from the budget to keep it the same as last year. He also pushed for a lower the tax rate. The town originally proposed $0.439 per $100 valuation, which is also the current rate, but came back with $0.434.
Dropping to $0.434 would result in the owner of the average-valued home in Flower Mound ($423,145) paying $22 less in taxes, and it would generate $594,107 less in property tax revenue.
Most of the residents in the room argued the tax rate should not be lowered since there are unknowns in the future. Some pointed to Senate Bill 2, which reduces the maximum amount the town can raise the tax rate without having an election from 8 percent to 3.5 percent, thus reducing property tax revenue.
“Now is not the time to lower the tax rate,” said resident Paul Stone.
During the meeting Pierson defended his stance on the tax rate.
“The tax cut we're talking about is miniscule,” Pierson said. “I'm struggling to see how saving $22 per household is causing this enormous uproar.”
Resident Patrick Martin supported the effective tax rate of $0.427168, saying residents were promised a lower rate when new development arrived.
The majority of the council said they favored keeping the tax rate as it is but, like Pierson had been pushing for throughout the process, supported reducing the amount of debt issued to fund capital improvement projects.
The staff presented a plan for that to happen. Kay Wilkinson, the town’s budget officer, presented the council with options for transferring excess fund balance to the CIP to eliminate the need for debt as previously planned. The town could transfer up to $2.5 million in excess fund balance, or $2.1 million if the tax rate is reduced to $0.434, to reduce the debt needed for two capital improvement projects next year. The council will decide Sept. 16 how to use the excess fund balance.
Pierson said when he ran for council he had three goals – reduce the town's density, fix the traffic problems and reduce the amount of debt that's issued. He said using more than $2 million instead of issuing debt accomplishes one of those.
“That, to me, is doing what I came here to do,” Pierson said. “That keeps us from continuing to rely on the bankers to build our town.”