Sugar Land, TX – City Manager Michael W. Goodrum recently submitted a proposed $298 million budget for fiscal year 2022, which begins Oct. 1.
The proposed budget includes $238.9 million for operations and $59.1 million for capital projects. It follows guidelines in the City Council-adopted Financial Management Policy Statements, builds on the success of strategies implemented in fiscal year 2021 to withstand the economic impact of the COVID-19 pandemic and maintains flexibility to respond to both opportunities and disruptions in an effort to recover from the pandemic and economic recession.
“The focus of this year’s budget is continued leadership in conservative, resilient and responsible stewardship,” said Goodrum. “We want to balance continued uncertainty regarding the economy with guarded optimism about recovery.”
The proposed budget ensures continued financial strength and resiliency by meeting all fund balance requirements, including the structural balance of the General Fund, and includes the first steps in beginning to restore the Sugar Land Way investments made in prior budgets that were delayed or reduced due to the pandemic. These efforts represent a conservative approach - with the total operating budget increasing by a smaller percentage than the most recent CPI figures when compared to the fiscal year 2020 budget, which was prepared prior to the pandemic.
Resiliency initiatives have strengthened the city’s financial position and better positioned Sugar Land for an uncertain future. Strong leadership and strategic financial planning lessened the impact of economic swings associated with sales tax - a major revenue stream for the city, but one that is highly volatile and difficult to forecast. This approach has enabled the city to continue providing priority services while maintaining one of the state’s lowest tax rates for similarly sized cities.
“We have one of the lowest residential tax burdens per capita in comparison to peer cities, in addition to the fact that Sugar Land’s tax rate represents only a small percentage of the total average residential tax burden,” said Deputy City Manager Jennifer May. “We are proud that residents tell us they receive a high level of value for their tax dollars and take great pride in their confidence. As the recovery continues, we will continue our conservative financial planning and investments in the services we provide to residents and businesses on a daily basis.”
The proposed fiscal year 2022 budget focuses on the highest priorities identified by residents in the 2020 citizen survey - including sidewalk rehabilitation, drainage projects, public safety initiatives, and mobility.
Building on the revised 2019 general obligation bond election implementation plan that was established last year due to the ongoing impacts of the pandemic, the proposed budget and capital improvement program include an approximate one-cent increase to the property tax rate for voter-approved projects. This increase - a cumulative reduction from the previously planned year-one tax rate increase of three cents - will fund the second year of the updated 2019 bond election project delivery plan, with a focus on drainage and public safety. The remainder of the projects and increases are planned to occur in future years, with implementation of the projects now spread over five years instead of three.
The proposed budget also includes recommendations from the recently completed Utility Rate Study, with the second phase of utility rate increases needed to implement citizen-led proposals for the Integrated Water Resources Plan. The proposed rates for 2022 will result in an increase to a residential bill of approximately $10 per month for 10,000-gallons usage. Additionally, the current rate for residential solid waste services is $19.76 per household per month and will increase 1.25 percent based on CPI increases under the contract to $20 per month.
Overall, strategies for fiscal year 2022 and the future include:
- first steps in restoring funding levels for services to departments to allow provision of services to the public – with restoration primarily focused on infrastructure rehabilitation and investments in the city’s replacement funds.
- community priorities such as supplemental sidewalk rehabilitation, mobility and traffic safety, and special events;
- public safety training, equipment, facilities and operations; and
- efforts to further turn the disruptions over the past two years into opportunities to be “better than before” and increase innovation.
A series of budget workshops, open to the public, will be held in August. A public hearing will be held on Sept. 7 to receive feedback from residents on the proposed budget, along with a public hearing on the proposed tax rate to be held on Sept. 14 prior to adoption of the budget and tax rate on Sept. 21. The City Charter requires the budget adoption by City Council no later than Sept. 25. For more information, visit www.sugarlandtx.gov/budget.