RIO GRANDE CITY — In a split vote, the city commissioners agreed to propose a 1-cent tax increase in an effort to pay for some of the city’s more “critical” needs.
The city must hold two public hearings before officially adopting the new rate.
Mayor Joel Villarreal and Commissioners Rey Ramirez and Hernan Garza voted of the proposal to bring the tax rate to .507579 per $100 valuation for the 2019-20 fiscal year.
Commissioners Flor Flores and Dave “Chachi” Jones voted against the measure.
Finance Director Leonel Cantu explained to the commissioners, during a meeting Wednesday afternoon, what the city’s financial outlook would be depending on how much taxes were raised.
A preliminary budget that was based off of the current tax rate of .497579 showed that tax revenues would bring in $58,000 for maintenance and operations. After expenses, the city would be left with about $13,000.
However, that draft budget excluded several line items including funding for the Boys & Girls Club, an annual cost of $93,000, an additional voting location which would cost $35,000, $105,000 for drainage, $36,000 for the fire department, $28,000 to the police department to allow them to become “paperless” and $15,000 to the municipal court for the same purpose.
Raising taxes by 3 cents would have brought in $188,000 in revenue that would have covered three items: the Boys & Girls Club, the additional voting location and funding for the fire department which were considered critical needs.
Informed that they were on a very tight schedule, Villarreal acknowledged the commission couldn’t put off the vote for another day.
However, the commissioners appeared reluctant to make a motion on the tax rate and both Jones and Flores said they would not be in favor of any increase.
“I’m comfortable with a 1-cent raise,” Commissioner Ramirez said. “I know we have not raised taxes in some time now and that would give us an additional 100,000 in revenue.”
Cantu, however, told them to keep in mind that the $100,000 in tax revenue included the $55,000 that was already being calculated in the budget, so in actuality the 1-cent hike would only bring in an additional $46,000.
Commissioner Garza said the most important issue for him was funding for the fire department.
“I believe they should be brought up to par and we need to find the revenues somewhere to bring them up to par and if that’s what it takes, I’m in support of it,” Garza said.
Villarreal said he was fine with raising taxes because of the many pending projects.
“Personally, I’m OK with raising — again, that’s my take considering we have a lot of things that we need to do,” he said.
He noted that the city badly needed a new treatment plant that would likely cost several million dollars.
“It’s already a must,” he said. “It’s already incumbent upon us to start this project.”
“We need to make sure that we’re in a position to highlight all these projects that we have in mind,” Villarreal said. “Rio Grande City continues to grow; we need to continue to set up the infrastructure, as we have, and that’s the reason there has been such a growth, because of the infrastructure that we’ve laid out.”