• October 23, 2014

Nolanville council moves to pare debt

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Posted: Tuesday, September 20, 2005 12:00 pm | Updated: 3:15 pm, Wed Aug 15, 2012.

By Judy Pack

Killeen Daily Herald

NOLANVILLE The Nolanville City Council has taken dramatic steps in the past week to pare down the citys long-standing debt from multiple sources, risking a backlash from local property owners.

On Thursday, the City Council reviewed a preliminary budget for the coming fiscal year that includes a 19.18-cent increase in the property tax rate. A vote on the budget, including the tax rate increase, is scheduled for 7 p.m. Sept. 27.

The proposed hike, to 62.28 cents per $100 valuation from the current rate of 48.23 cents, would mean the owner of a $100,000 home would have to pay $191 more taxes annually.

The proposed rate would raise revenue of $287,501, for an estimated budget of $919,756. The proposed rate is a 44.5 percent increase over the current rate.

This tax rate is right on the verge of a rollback, said City Councilman Noah VanKirk of the proposed increase.

The rollback rate is 8 percent above the citys effective tax rate the level that would raise the same revenue as the current rate. Nolanvilles current effective rate is 43.1 cents.

At the rollback rate, residents can force an election to return to the rate to the effective rate.

Although nothing has been decided yet, VanKirk said the additional revenue will go towards paying off the citys accumulated debt.

On Monday, the council agreed to a $270,000 sales tax anticipation note, in order to pare down the citys long-standing debt of about $400,000.

Under the terms of the note, the city would borrow the $270,000 in advance of receiving the corresponding amount in sales tax next year.

We went to the (Texas) Attorney Generals Office, and for the 70-cent tax levy, its not sufficient for the $400,000 loan wed hoped for, Christina M. Lane, managing director for SAMCO Capital Markets in Austin, told the City Council in the first meeting. $270,000 is pretty much what were stuck with.

Lane also advised that debt to the Internal Revenue Service, the Texas Municipal League, and the State of Texas be prioritized. The managing director has been working with the city of Nolanville to hire a part-time bookkeeper and cut expenses.

The majority of tax dollars are received in January, she said, which will be used to pay off the loan. If the city has $124 million in new value for the next year, the result will be more revenue. This will provide the city with funds to pay the long-standing debts, she said.

Im 69 years old and Ive never missed a bill in my life, VanKirk said of the plan. Im against this $270,000 note, but for the good of Nolanville.

Regarding the budget and tax rate, Mayor Mike Carter said constant building in the small town was a positive sign, and operating the city with an up-to-date budget rather than one that was two years behind had been part of the management problem.

At the evening budget workshop, trash service and road repairs dominated the questions regarding city spending.

While $10,000 for street repairs for the 2005 fiscal year has been budgeted, Carter said only maintenance could be done without more money.

If you dont have the money, all you can do is maintain them, he said to complaints of potholes along 10th Street.

The cost to reseal and widen the street leading to the new homes on 10th was too expensive, but future sales tax revenue will provide some relief, he explained. With 219 additional houses built in the current year, over $2 million worth of value has been added to the city, he said.

New houses stabilizes taxes, he explained.

Contact Judy Pack at jpack@kdhnews.com

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