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Item 4GCITY OF SOUTHLAKE MEMORANDUM July 26, 2016 To: Shana Yelverton, City Manager From: Sharen Jackson, Chief Financial Officer Subject: Consider proposal to adopt a tax increase and set public hearing on the tax rate for the August 16, 2016 and September 6, 2016 Regular City Council meetings Action Requested: Place proposal to adopt a tax increase and set public hearing on the tax rate for the August 16, 2016 and September 6, 2016 City Council meeting. Background Information: The proposed tax rate of $.462 will exceed the effective tax rate ($.456949) and increase tax revenues. Even though the tax rate is held at $.462, the tax rate exceeds the effective tax rate ($.456949) by 1.11 %. Because the tax rate exceeds the effective tax rate, state law requires that two public hearings be held by the governing body before adopting the proposed tax rate. The city council must vote to place a proposal to adopt the rate on the agenda of a future meeting as an action item and hold two public hearings on the proposal. Financial Considerations: The effective tax rate would result in a property tax revenue reduction of $321,693 Strategic Link: F1 Adhere to financial management principles and budget Citizen Input/ Board Review: Public hearings would be scheduled for August 16th and September 6th Legal Review: None required Alternatives: None Supporting Documents: None Staff Recommendation: Place a proposal to adopt a tax rate increase and set public hearings for the August 16th and September 6th Regular City Council meeting.