The Rockport City Council, at its special meeting Tuesday, Sept. 15, held a public hearing regarding the city’s 2020-21 budget, followed by the unanimous passage of the budget on first and only reading, and the unanimous passage of the 2020 tax rate on second and final reading.

Rockport’s 2020 tax rate is $.421311. That includes $.241668 for the purposes of maintenance and operation, and $.179643 for payment of principal and interest on city debt.

The current tax rate is $.420082.

The budget can be reviewed at cityofrockport.com.

The final thing related to the budget and tax rate was ratifying the property tax increase reflected in the budget and capital improvement plan.

The 2020-21 budget will raise $480,469 more in new revenue than last year, an increase of 8.53%, according to the state required No New Revenue tax rate calculation. And, it includes revenue from new value. According to Director of Finance Katie Griffin, the actual increase is only 4% over the No New Revenue tax rate because the tax rate calculation does not include any new value.

Kristie Rutledge and Andrew Kane spoke during the public hearing, as well as during some the agenda items related to the budget and tax rate. Rutledge and Kane also spoke in opposition to the tax rate at the public hearing Sept. 8.

Rutledge urged the council not to adopt the proposed budget and tax rate, citing Gov. Greg Abbott’s urging entities to lower taxes.

She referred to the undo hardship on commercial properties, some of which saw significant increase in property values due to a change this year in the way such properties are valued.

Rutledge also warned the council about stacking up payments on the back end of its recently approved debt via tax notes for the new city hall and Key Allegro Bridge.

Kane asked how the city plans to make its debt payments after the government loan (secured after Harvey, and expected to be forgiven) runs out.

“This council is going to lead us into an economic disaster in the future,” he said.

Councilwoman Andrea Hattman said, “I understand you guys are upset, but we have to do what we have to do. I’m sorry y’all don’t fully understand why we are making the decisions we do to run the city.”

Rutledge asked the same question about how the city plans to pay the tax note debt.

“There’s been a lack of transparency (regarding the issuance of new debt),” she said. “This has a lot of us very, very concerned. We have to face rising rates and values.”

Rutledge said the council can cut $28,000 from the budget by not increasing top management’s pay, and dropping consultants.

Councilman Bob Cunningham said he shared some of the same concerns about paying of the debt, but Financial Advisor Bob Henderson explained how funds would be available as the Pearl Point project develops, adding to the tax base, under an agreement between the developers and the city.

“That’s the plan,” said Mayor Pat Rios. “We are looking at increased tax revenues from Pearl Point (and other housing developments).”

Addressing another concern aired by Rutledge, Cunningham said the city needs to “look at what our real cost is with an expanding tax base.”

He shared her concerns about the new way commercial properties are valued for taxing purposes, as well.

Rios noted the way the value of RV Parks was determined changed last year, and this year it’s commercial properties.

Cunningham questioned if the state is actually imposing an income tax (in theory) by changing the way commercial properties are valued (revenue).

Mayor Pro-tem JD Villa noted the budget workshop was open to the public and on Zoom.

“I encourage everyone to participate (in the future),” he said.

Cunningham also noted the city is having to rebuild its reserves, which where knocked down due to post-Harvey expenses.

In regard to questions about paying off debt, Rios added current debt will fall off as it’s paid off, and tax note funds will not be deposited as they are needed.

“We don’t have it (all the tax note money) now,” he said.

During the final agenda item regarding the budget and tax rate, Rutledge said she looked up the budget workshop dates (originally scheduled for two consecutive days), and the second day was cancelled.

“It’s condescending to be told we’re not involved (when you purposely make it hard to do so by doing things like putting out agendas late on Friday afternoons).

“There are ways to cut the budget, and I don’t think you guys tried very hard.”

Hattman responded, “Ms. Rutledge, I find it offensive to hear you say I don’t care. I have a family and a business (paying taxes). I too want transparency and it (all the information we receive) is out there (for anyone to see).

Hattman noted that she stays very busy with family and business responsibilities, as well as serving on the council, and added, “I also have big time involvement in this community (in other areas).”

Cunningham said he will personally let Rutledge know when next year’s budget workshops are planned.

“I appreciate her perspective. I think (she) has a valuable voice,” he said.

I was also noted posting Tuesday meeting agendas on Friday has been done for years to meet statutory requirements, as well as to allow the greatest amount of time to add items to an agenda.

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