Sherman city leaders discussed upcoming expenses, projects and planned growth Thursday when they presented a nearly $40.97 million general fund budget for the 2019-2020 fiscal year. The discussions came as a part of the city’s annual budget workshop, which serves as the unofficial start to the budget season and the creation of next year’s financials.
This year’s talks included discussions on how to address space needs for the police department and Sherman Fire-Rescue, street improvements and other projects aimed at encouraging future development and growth in the city.
“I think the continued focus of this budget is for development related items,” City Manager Robby Hefton said following the meeting. “We spent a lot of time talking about tools that we have to encourage quality development in our community, so that was one of the themes for today. Related to that theme is paying for the debt relating to those capital expenditures we’ve made to entice development.”
For the upcoming fiscal year, the city is proposing a $0.502 property tax rate — an increase of about seven cents — for each $100 of assessed value. This rate encompasses two separate rates: a $0.16 interest and sinking rate for the city’s bond debt and a $0.34 maintenance and operation rate for the city’s general services and operations.
The largest portion of the increase will be seen in the bond rate, which will increase by five cents under the proposed rate.
“The investments we are making today, that we are paying for today, are going to reap benefits, but the reaping of those benefits is delayed a little bit,” Hefton said. “We pay for them up front, but we don’t get the immediate return. We get that return three, four, five years down the road. We believe this return is far greater than the cost of pursuing it, but we just have to be patient in seeing the returns come.”
City officials proposed possible ways to offset this increase for residents to some degree. Sherman residents will likely see indirect tax relief through Grayson County itself due to its recent reduction in taxes over recent years. Hefton said the county has reduced its rate by nearly five cents in recent years, and this trend is expected to continue.
Hefton also proposed a 20 percent increase to the city’s commercial solid waste fees with excess tonnage charges on roll-off containers. This, in turn, would be used to reduce the monthly waste fee by about $4, he said.
Another proposal would see the tax rate set at about $0.48, with the incremental income earned through the commercial rate used to pay for the city’s debt service. In both scenarios, the city’s solid waste fund balance would be lowered to about 50 days of reserve, Hefton said.
“That isn’t ideal and it couldn’t be proposed on to eternity,” Hefton said, regarding the relief.
City officials said they received requests for 24 additional staff in this year’s budgeting process, but only five are recommended for approval in this year’s proposed budget. The draft includes two additional park ground maintenance positions, a public safety dispatcher, a solid waste driver and one part-time position in information technology.
Existing staff could see a 2.5 percent across-the-board increase in pay while police and fire could see the equivalent of a 3 percent increase. Hefton said the civil service increase would not be the same for all workers, but would average out to about three percent. This would come in addition to a proposed pay increase for EMT workers aimed a compensating for the stress and burnout that comes with the position, Hefton said.
Other items, including the proposed construction of a new fire station remained somewhat uncertain following Thursday’s meeting. The city council directed city staff to pursue looking into the construction of a new $12 million police station — effectively killing plans to renovate the existing building. However, questions regarding the future of the building and plans for fire station improvements remained, with city officials promising to bring more details at a future date.
Michael Hutchins is the local government reporter for the Herald Democrat. He can be reached at MHutchins@HeraldDemocrat.com.