The Fulton Town Council held public hearings for the Town’s 2022-23 budget and 2022 tax rate Wednesday, Sept. 7.
The budget will raise more revenue from property taxes than last year’s budget by an amount of $157,594, which is a 26.59% increase from last year’s budget. The property tax revenue to be raised from new property added to the tax roll is $14,389.
Following the hearings, during the regular meeting, the council unanimously approved five items related to the budget, the tax rate, and the collection of taxes.
The council first approved an interlocal cooperation agreement for tax assessment and collection of property taxes between the Town and Aransas County.
It then approved the new tax rate of $.273187, which is effectively a 24.99% increase in the tax rate.
Ordinance No. 304 was approved next, adopting the tax rate and levy of ad valorem taxes for use and support of the Town for the 2022-23 fiscal year, providing for apportioning each levy for specific purposes, and providing when taxes will be due and when they become delinquent.
Then the council approved the 2022-23 budget.
The council’s final action was approving Ordinance No. 303, making appropriations for the support of the Town for fiscal year beginning Oct. 1, 2022, and ending Sept. 30, 2023, and adopting the annual budget for the 2022-23 fiscal year.
Budget public hearing
Mayor Kelli Cole opened the hearing noting she knows nobody wants to pay more taxes, but the proposed rate hike to fund the budget is needed to take care of the needs of Fulton residents.
She then gave a report about where the Town is five years after Hurricane Harvey:
• In 2017 Fulton had three employees in its maintenance and permit department. Before Harvey one employee retired and the Town did not hire a replacement.
• Because of Harvey Fulton lowered its tax rate for the 2018-2019 budget, which resulted in lower property tax revenue. “This was tough, but we recognized our residents were devastated by the losses that occurred because of Harvey,” said Cole.
• Fulton finally hired a third fulltime maintenance employee last year.
• Fulton continues to operate with a smaller staff than most cities its size, but as its population continues to grow, it needs to make some changes to keep up with the growth. To meet the growing demands and keep up with the day-to-day operations of the Town, one of Fulton’s current maintenance employees will be moved to a fulltime position in the permit and code enforcement department so that they can focus on taking care of things that need addressing. This creates the need to hire an additional maintenance employee.
• Changes to Fulton’s essential services includes an increase of $35,000 for dispatch services provided by Rockport.
• Allegiance Ambulance is working on a new interlocal agreement, which should result in a slight reduction to Fulton’s cost based on call data.
• The budget does includes funding to purchase software and website improvements so Fulton can be brought into the 21st century.
• The budget also includes $100,000 for street improvements (seal coating and asphalt).
• Demand for law enforcement services continues to grow. The Town has an interlocal agreement with the Rockport Police Department (RPD) to respond for service calls if Fulton is unable to respond. This agreement does not include patrolling Fulton. Cole said it’s time to hire an officer to cover the increased workload. The budget also includes a new police vehicle and essential equipment.
• There is no increase in sewer rates, but the City of Rockport is increasing its rates. If required, sewer rates will be increased during the year.
Kathy Kane told the council there is a difference between wants and needs.
“This budget has quite a few wants and is definitely outside the taxpayers’ ability to fund,” she said. “I believe a town that is growing both in rooftops an in appraised values should use the No New Revenue tax rate of 22¢. Instead you are asking for an extra five cents.”
She asked why there is a new line item in Hotel Occupancy Tax (HOT) expenditures for $20,000 for advertising and promotion when the Town is paying the Chamber $50,000 to act as its visitor and tourism arm.
Pointing out the $175,000 in HOT funds transferred to the Fulton Convention Center, Kane said she hopes the Town is using the maximum amount allowable by law.
She said the convention center should operate within its means. Kane said cutting convention center expenses will allow Fulton to manage with the Voter Approval Rate of 22.5¢.
Fulton Comptroller Steven Robertson said no property tax revenues are used to operate the convention center, and that some HOT funds not used in the current year are carried over to the new budget.
He said Aransas Pass and Port Aransas use more than $300,000 in HOT funds to fund their convention centers.
Cole noted the convention center is a new building, but it has some problems the Town has been working on for the past couple of years.
Robertson said the Town has just gotten back to pre-Harvey levels in regard to HOT fund collections.
Kane asked if Fulton can put more HOT money into the convention center since it is operating at a loss.
Robertson said, “Please inform me if there is a convention center owned by a municipality that is not operating at a loss that is funded by HOT because I would love to see it.”
One man thanked the council for adding the Homestead exemption.
He suggested sharing one police car between the chief and new hire to save money.
He also noted one additional police officer isn’t going to provide 24/7 coverage, and help from the RPD and other agencies will still be required.
“My point is, it’s not a bad thing to pay somebody to do your work for you,” he said. “It’s called outsourcing and management.”
Tax rate public hearing
Mary Clare Kane said the council approved a 27¢ tax rate and used a loophole to use the de minimis rate (which is higher than the Voter Approval Rate) to get around the reasonable limit of the Voter Approval Rate of 22.5¢.
“The proposed tax rate of $.273187 is a 26% increase,” said Kane.
She said increased property values and new construction should provide ample new revenue.
“We are in the middle of an inflation and many families are struggling to put gas in their cars, and food on the table,” said M. Kane. “When I buy two apples at HEB for $1 each, I wonder how parents are fixing lunches for their children.
“Families are having to trim their budgets, and you need to do the same.
“I’m asking you to amend the budget and lower the tax rate to less than the Voter Approval Tax Rate of 22.5¢.
Former Fulton Mayor Russel Cole encouraged the council to approve the tax increase, noting the Town has come a long way since it incorporated, but it’s growing.
One woman suggested installing pickle ball courts in the convention center to support the growing popularity of the sport.