2021 Ad Valorem Tax Rate

1. CITY OF ALAMO HEIGHTS
ADMINISTRATION AND FINANCE DEPARTMENT
CITY COUNCIL AGENDA MEMORANDUM
TO: Mayor and City Council
FROM: Robert Galindo, Finance Director
SUBJECT: Proposed Ad Valorem 2021 Tax Rate
DATE: August 9, 2021
SUMMARY
The City is proposing to adopt the 2021 property tax rate of $0.404439 per $100 valuation. The
maintenance and operation (M&O) tax rate of $0.336439 per $100 of taxable value is the rate that
will produce tax revenues projected in the Proposed FY 2021-22 Budget. An interest and sinking
(I&S) rate of $0.068000 per $100 of taxable value is proposed to fund the debt payments paid by
property taxes. A public hearing will be held on August 23, 2021 at the regularly scheduled council
meeting. An action item to adopt the City’s total tax rate of $0.404439 per $100 of taxable value
on the agenda of the August 23, 2021.
M&O Rate $0.336439
I&S Rate $0.068000
Tax Rate $0.404439
BACKGROUND INFORMATION
The Texas Property Code requires the City Council vote to place a proposal to adopt the 2021 tax
rate on the agenda of a future meeting as an action item if the proposed rate exceeds the no new
revenue tax rate. The no new revenue tax rate is a calculated rate that would provide the taxing
unit with approximately the same amount of revenue it received in the year before on properties
taxed in both years. The voter approval tax rate is a calculated maximum rate allowed by law
without triggering an automatic election for voter approval.
Senate Bill 18 passed during the 79th
State Legislative Regular Session requires several State-
mandated steps. The following calendar details each of the actions and steps required in setting a
proposed and a final tax rate.
Date Action
Sunday, July 25, 2021 Deadline for Chief Appraiser to certify tax roll.
Saturday, August 7, 2021 Deadline for Tax Assessor Calculations of tax rates
Monday, August 9, 2021 Meeting of governing body to discuss and vote on
proposed tax rate; take a record vote and schedule a
public hearing for August 23, 2021. Schedule an
action item for adoption of the tax rate on August 23,
2021.

2. Date Action
Wednesday, August 11, 2021 Publication in general circulation newspaper of
no new revenue and voter approval tax rates per
notice required by Senate Bill 2, “Notice of Tax
Rates” and scheduling one public hearing, unless No
New Revenue Tax Rate is proposed.
Monday, August 23, 2021 Meeting of governing body to have a public hearing
of the proposed ad valorem tax rate.
Monday, August 23, 2021 Meeting of governing body to adopt the ad valorem
tax rate: a record vote is required and a motion to
adopt the ordinance setting a total tax rate must be
made in the following form: “I move that property
taxes be increased by the adoption of a total tax rate
of $0.404439 per $100 valuation.”
Based on the 2021 certified tax roll the following rates were calculated and will be published in
the San Antonio Express-News on August 18, 2021:
Proposed tax rate: $0.404439 per $100 valuation
Preceding year’s tax rate: $0.386439 per $100 valuation
No New Revenue tax rate: $0.379683 per $100 valuation
Voter Approval tax rate: $0.451964 per $100 valuation
A record vote is taken on the proposed tax rate. City will schedule one public hearing and publish
notices before adopting a tax rate if the proposed rate exceeds the no new revenue tax rate.
The no new revenue tax rate is a calculated rate generally equal to the last year’s taxes divided by
the current taxable value of properties that were also on the tax roll last year. The resulting rate,
used for comparison only, shows the relation between the last year’s revenue and the current year’s
values. The voter approval tax rate includes the M&O portion of the tax rate and the I&S or debt
service portion necessary to pay debt payments in the coming year.
The proposed total tax rate ($0.404439 per $100) is composed of an M&O and I&S rate. The 2021
M&O tax rate of $0.336439 per $100 of taxable value. In comparison to other area cities, the City
has maintained a comparatively lower tax rate. The proposed 2021 I&S tax rate is $0.068000 per
$100 of taxable value is equal.
POLICY ANALYSIS
A record vote must be taken on the proposed rate. If the proposed tax rate exceeds the no
new revenue tax rate of $0.379683, the City Council is required to vote on the tax rate and
publish notices pursuant to Truth-In Taxation guidelines. Adoption of the tax rate is scheduled
for the August 23, 2021 Council meeting.

3. FISCAL IMPACT
The proposed operations and maintenance tax rate for 2021 of $0.336439 per $100 will generate
$6,154,180 in revenues for General Fund operations in FY 2021-22. The 2021 proposed I&S rate
of $0.068000 will generate $1,243,864 in revenues for long-term debt payments in FY 2021-22.
______________________
Robert Galindo
Finance Director
______________________
Buddy Kuhn
City Manager