FY26 Proposed Budget

Typically, the City experiences a larger boost in taxable value in valuation years (odd years). FY 2023 deviated from that trend and the taxable valuation decreased , again due largely to a reduction in the taxable percentage of residential properties (including multi-family). These rollback impacts, combined with only modest new construction, led to another decrease in taxable valuations for FY 2024. The 3.6% taxable growth in FY 2025 was a positive step forward, and the 2.3% taxable growth in FY 2026 helps further, but these amounts still fall well short of needed levels of growth to support status quo operations that were experienced in the previous fiscal years of 2017, 2019 and 2021. As shown by the following chart, fiscal years 2023 and 2024 marked the lowest two-year total in taxable valuations growth within the last ten years by a wide margin followed by modest increases in fiscal years 2025 and 2026.

Total Property Tax Valuations & % Change over Prior Fiscal Year

$0 $1,000 $2,000 $3,000 $4,000 $5,000

0.0% 2.0% 4.0% 6.0% 8.0% 10.0%

Despite these financial impacts, the FY 2026 budget is able to retain a stable property tax levy rate, which helps meet the goal of cost-containment for our residents and businesses. For eleven consecutive years ending in FY 2023, tax rate reductions were made possible by prudent debt strategies, operational efficiencies, and valuation growth. Notably, reductions in the debt service portion of the tax levy were achieved through debt restructuring and early bond retirement strategies, fueled by valuation growth. However, our debt service revenue is no longer keeping up with project costs in this inflationary market. To help meet the need, the debt service rate is increased slightly in FY 2026 to help maintain the investment impact of our Capital Improvement Program. This is offset by a reduction in the Employee Benefits levy. FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY24 FY25 FY26 Tax Value (millions) $3,421 $3,543 $3,745 $3,923 $4,258 $4,396 $4,376 $4,360 $4,517 $4,619 Val % Change 7.50% 3.55% 5.72% 4.74% 8.54% 3.24% -0.46% -0.36% 3.61% 2.26% -2.0% Taxable Value (in millions) FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY24 FY25 Tax Value (millions) $3,421 $3,543 $3,745 $3,923 $4,258 $4,396 $4,376 $4,360 $4,517 $4,619 Val % Change 7.50% 3.55% 5.72% 4.74% 8.54% 3.24% -0.46% -0.36% 3.61% 2.26% Property Tax Rate 16.583 16.333 16.183 15.833 15.773 15.673 15.633 15.633 15.633 15.633 Rate % Change -0.41% -1.51% -0.92% -2.16% -0.38% -1.01% -0.26% 0.00% 0.00% 0.00% 15 15.5 16 16.5 17 $0 $1,000 $2,000 $3,000 $4,000 $5,000 Taxable Value (in millions) Property Tax Rate vs. Valuations FY26

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