ADA_CityHall1.jpg

Killeen city council met at City Hall Tuesday to discuss the proposed budget.

The Killeen City Council got a second look at street financing options — and a new tax rate — at the end of a workshop Tuesday.

In what turned out to be a lengthy presentation, Executive Director of Finance Jon Locke presented several scenarios that may be used for street maintenance and reconstruction.

Locke proposed a new property tax rate of 70.56 cents per $100 valuation — which is down from the 72.30-cent tax rate proposed in the fiscal year 2022 budget, and even lower than the current rate of 73.30.

According to Locke, increased tax valuations conducted by the county have allowed the city to lower the proposed tax rate. However, residents will pay the same amount of tax with the new rate of 70.56 cents as with the previous rate of 72.30 under the old property valuations, Locke said.

This ties directly into increased funding, which has been a focal point of budget discussions as the council has sought to reach maintenance standards and begin road reconstruction.

The council has generally supported increases to the street maintenance fee, but members are still undecided as to how high the maintenance fee will need to be adjusted, and how much bond debt should be issued.

The following is a breakdown of possible funding scenarios that the city government may pursue.

In the first scenario, the council would issue $24 million in bonds and would increase the monthly street maintenance fee for single-dwelling households to $7 — up from the current $1.70.

According to Locke, this mechanism would generate $119.5 million over 10 years that would go toward street reconstruction, as well as addressing debt service and annual street maintenance.

This scenario is aggressive, but would also require about $15.2 million in debt service.

The second scenario requests $60 million in bond issues, and increases the street maintenance to $7. This is the city’s proposed plan, which Locke asserts would generate $104 million in potential construction funding while reducing costs for most taxpayers.

This scenario is riskier, requiring the city to service $33.7 million in debt. However, according to Assistant City Manager Danielle Singh, the city would be able to reconstruct nine to 10 streets over the 10-year period, while enjoying short term aggression.

The third option, requested by Councilwoman Mellisa Brown, would issue $24 million in bonds from the property tax, but would only raise the street maintenance fee to $5. According to Locke, this would generate $79.5 million in road construction funding over the next 10 years.

However, when considering total construction costs, Brown said, it is important to remember that the city can only handle approximately $20 million of in-house construction supervision annually.

This was in reference to a comment made during Saturday’s budget workshop, in which Cagle informed the council that the city can only handle about $20 million worth of construction using in-house management. Annual construction costs exceeding $20 million would require the city to outsource engineering consultancies — substantially increasing the cost.

The council did not come to a consensus on which scenario to pursue; however, most members favored an increase in the street maintenance fee.

Councilman Rick Williams, citing the destructive impact of poorly maintained roads, made his position clear.

“It’s economically necessary to attract businesses, to be better,” Williams said. “I also don’t want my water bill to go up. But we have to do it.”

Brown was more hesitant, however.

“I am just concerned with us taking out debt to pay for street maintenance. We’ve taken out debt service before, and it never goes away,” Brown said.

In a previous meeting, the council had been challenged by the mayor “to do what they had to” and to have the “political will” to make difficult decisions.

“This is a big ask for citizens to do this,” Williams said. “But in the long run, this is absolutely necessary.”

jdowling@kdhnews.com | 254-501-7552

jdowling@kdhnews.com | 254-501-7552

Locations

(0) comments

Welcome to the discussion.

Keep it Clean. Please avoid obscene, vulgar, lewd, racist or sexually-oriented language.
PLEASE TURN OFF YOUR CAPS LOCK.
Don't Threaten. Threats of harming another person will not be tolerated.
Be Truthful. Don't knowingly lie about anyone or anything.
Be Nice. No racism, sexism or any sort of -ism that is degrading to another person.
Be Proactive. Use the 'Report' link on each comment to let us know of abusive posts.
Share with Us. We'd love to hear eyewitness accounts, the history behind an article.