Item 6AM E M O R A N D U M
September 8, 2020
To: Shana Yelverton, City Manager
From: Sharen Jackson, Chief Financial Officer
Subject: Ordinance No. 1234, 2nd Reading, Tax Levy Ordinance
Action
Requested: The purpose of this item is to seek Council approval on the
tax levy at a tax rate of $0.405.
Background
Information: The FY 2021 budget as submitted to the City Council
proposes a tax rate of $.405 per $100 of a property’s taxable
value. State law requires the City to adopt the tax rate in two
components. Part of the tax rate, $0.075 (18.5%) per $100,
pays for the retirement of debt that is due during the 2021
budget year. The remainder of the tax rate, $0.33 (81.5%) per
$100, is used to support General Fund operations of the City.
On July 25th, the Tarrant and Denton Appraisal Districts
certified to City management the appraised values of all
properties in Southlake. Total taxable value in the City is
$7,768,644,007 (net of TIF value), which is the value of
properties as of January 1, 2020. Upon adoption of a tax rate
upon the second reading, the City’s tax collector, Tarrant
County, will be notified of the adopted rate. Tarrant County
will then apply the tax rate to the taxable values of properties
in Southlake and generate tax statements after October 1,
2020.
This year's proposed tax rate ($0.405) falls below the
effective tax rate ($0.422115) and will reduce tax revenues
for FY 2021.
The proposed budget also includes tax relief in the form of a
20% homestead exemption and a rate reduction of $0.005.
Financial
Considerations: For FY 2021 tax rate reduction of $0.005 with a total tax rate
of $0.405. The tax rate allocation of $0.33 for general fund
operations and $0.075 for debt service. As previously
Item 6A
mentioned, this will provide a distribution of 81.5% of the rate
for operations and 18.5% for debt service.
Strategic Link: F1 Adhere to financial management principles and budget
Citizen Input/
Board Review: Public hearing is scheduled for September 15th
Legal Review: None required
Alternatives: In the absence of approving and adopting the ordinance, the
existing tax rate and related allocation between maintenance
and operations and debt service would remain in force until
otherwise provided.
Supporting
Documents: Ordinance No. 1234
Staff
Recommendation: Approval of Ordinance No. 1234, on 2nd reading, levying ad
valorem taxes at the rate of $.405 for the Fiscal Year
beginning October 1, 2020 and ending September 30, 2021.
ORDINANCE NO. 1234
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
SOUTHLAKE, TEXAS, FIXING AND LEVYING MUNICIPAL AD
VALOREM TAXES FOR THE FISCAL YEAR BEGINNING
OCTOBER 1, 2020 AND ENDING SEPTEMBER 30, 2021, AND
FOR EACH YEAR THEREAFTER UNTIL OTHERWISE
PROVIDED, AT THE RATE OF $0.405 PER ONE HUNDRED
DOLLARS ($100.00) ASSESSED VALUE ON ALL TAXABLE
PROPERTY WITHIN THE CORPORATE LIMITS OF THE CITY
OF SOUTHLAKE, TEXAS, AS OF JANUARY 1, 2020, TO
PROVIDE REVENUES FOR THE PAYMENT OF CURRENT
EXPENSES AND TO PROVIDE AN INTEREST AND SINKING
FUND ON ALL OUTSTANDING DEBTS OF THE CITY;
DIRECTING THE ASSESSMENT THEREOF; PROVIDING FOR
DUE AND DELINQUENT DATES TOGETHER WITH
PENALTIES AND INTEREST THEREON; PROVIDING FOR
PLACE OF PAYMENT; PROVIDING FOR APPROVAL OF THE
TAX ROLLS PRESENTED TO THE CITY COUNCIL;
PROVIDING FOR THE REPEAL OF INCONSISTENT
ORDINANCES; PROVIDING FOR A SEVERABILITY CLAUSE;
AND DECLARING AN EFFECTIVE DATE.
WHEREAS, the City Council of the City of Southlake, Texas (hereinafter referred to as the
"City") hereby finds that the tax for the fiscal year beginning October 1, 2020, and ending
September 30, 2021, hereinafter levied for current expenses of the City and the general
improvements of the City and its property must be levied to provide the revenue requirements of
the budget for the ensuing year; and
WHEREAS, the City Council has approved, by a separate ordinance adopted on the 15th
day of September 2020, the budget for the fiscal year beginning October 1, 2020, and ending
September 30, 2021; and
WHEREAS, all statutory and constitutional requirements concerning the levying and
assessing of ad valorem taxes have been complied with.
NOW THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF
SOUTHLAKE, TEXAS:
Section 1. That all of the above premises are found to be true and correct and are
incorporated into the body of this Ordinance as if copied in their entirety.
Section 2. That there is hereby levied and ordered to be assessed and collected for
the fiscal year beginning October 1, 2020, and ending September 30, 2021, and for each fiscal year
thereafter until it be otherwise provided by and ordained on all taxable property, real, personal and
mixed, situated within the corporate limits of the City of Southlake, Texas, and not exempt from
taxation by the Constitution of the State and valid State laws, an ad valorem tax rate of $0.405 for
the general operations of the City on each One Hundred Dollars ($100.00) assessed value of
taxable property, and shall be apportioned and distributed as follows:
a. For the purpose of defraying the current expenses of the municipal government of
the City, a tax of $0.33 on each One Hundred Dollars ($100.00) assessed value of
all taxable property. THIS TAX RATE WILL RAISE LESS TAXES FOR
MAINTENANCE AND OPERATIONS THAN LAST YEAR'S TAX RATE.
THE TAX RATE WILL EFFECTIVELY BE REDUCED BY 1.58 PERCENT
AND WILL REDUCE TAXES FOR MAINTENANCE AND OPERATIONS
ON A $100,000 HOME BY APPROXIMATELY $5.30.
b. For the purpose of creating a sinking fund to pay the interest and principal on all
outstanding debt of the City, not otherwise provided for, a tax of $0.075 on each
one Hundred Dollars ($100.00) assessed value of all taxable property, within the
City which shall be applied to the payment of such interest and maturities of all
outstanding debt.
Section 3. That all ad valorem taxes shall become due and payable on December 31,
2020, and all ad valorem taxes for the year shall become delinquent after January 31, 2021. There
shall be no discount for payment of taxes prior to January 31, 2021. A delinquent tax shall incur all
penalty and interest authorized by State law Sections 33.01 and 33.11 of the Property Tax Code,
to-wit: a penalty of six percent (6%) of the amount of the tax for the first calendar month it is
delinquent plus one percent (1%) for each additional month or portion of a month the tax remains
unpaid prior to July 1st of the year in which it becomes delinquent.
Provided, however, a tax delinquent by July 1st incurs a total penalty of twelve percent
(12%) of the amount of the delinquent tax without regard to the number of months the tax has been
delinquent. A delinquent tax shall also accrue interest at a rate of one percent (1%) for each month
or portion of a month the tax remains unpaid. Taxes that remain delinquent on July 1, 2021 incur
an additional penalty of twenty percent (20%) of the amount of taxes, penalty and interest due;
such additional penalty is to defray costs of collection due to contract with the City's attorney
pursuant to Section 6.30 of the Property Tax Code.
Section 4. Taxes are payable at the office of Tarrant County Tax Collector. The City shall
have available all rights and remedies provided by law for the enforcement of the collection of taxes
levied under this ordinance.
Section 5. That the tax rolls, as presented to the City Council, together with any supplement
thereto, be, and the same are hereby approved.
Section 6. That any and all ordinances, resolutions, rules, regulations, policies or provisions
inconsistent or in conflict with the provisions of this Ordinance are hereby expressly repealed and
rescinded to the extent of the inconsistency or conflict.
Section 7. If any section, article, paragraph, sentence, clause, phrase or word in this
Ordinance, or application thereto any person or circumstances is held invalid or unconstitutional by
a Court of competent jurisdiction, such holding shall not affect the validity of the remaining portions
of this Ordinance; and the City Council hereby declares it would have passed such remaining
portions of this Ordinance despite such invalidity, which remaining portions shall remain in full force
and effect.
Section 8. That the necessity of and levying municipal ad valorem taxes of the City for the
next fiscal year as required by the laws of the State of Texas, requires that this Ordinance shall
take effect immediately from and after its passage, and it is accordingly so ordained.
PASSED AND APPROVED on first reading this _____ day of _________________,
2020.
_________________________
Laura Hill
Mayor
ATTEST:
_________________________
Amy Shelley
City Secretary
PASSED AND APPROVED on second reading this _____ day of _________________,
2020.
_________________________
Laura Hill
Mayor
ATTEST:
__________________________
Amy Shelley
City Secretary
APPROVED AS TO FORM:
__________________________
City Attorney
Date:_____________________
Adopted:__________________
Effective:________________