San Marcos City Council To Hold Budget Workshop Tonight

Staff Reports

Tonight, the San Marcos City Council will be given a presentation regarding the Fiscal Year 2019-2020 Financial Update and the preliminary Fiscal Year 2020-2021 Budget.

On June 4, the city council approved a resolution directing staff to calculate the tax rate in the manner provided for a special taxing unit by using an 8 percent threshold for revenue.

According to city staff, the city of San Marcos is projected to experience a $6.4 million shortfall in revenue due to the COVID-19 economic shutdown. The Council directed staff in April to begin work on finding areas where cost reductions can be made to compensate.

The council is currently aiming to reduce costs by $5.5 million and make up the remaining $900,000 through a utility franchise fee increase from 7 percent to 8 percent.

The city’s total budget for FY 2020 was $239 Million; thus far, city staff has identified a total of $4,644,086 in cost reductions through the FY20 General Fund; an employee innovation box is under review for additional reductions of $856,086.

Additionally, the FY 20 budget, sales taxes represents 44.4 percent of the total general fund revenue projected for the fiscal year 2020. “Sales tax receipts are the largest single revenue source supporting general governmental services in San Marcos.”

In June, the Texas Comptroller distributed $4,299,578.95 in sales tax revenue to the city of San Marcos despite the pandemic.

The revenue amount is a 50% over what the city received this time last year.

However, in May, the city only received $3,741,141.91 in revenue from sales tax, which is a mere 23.13% increase over May 2019.

The total amount of sales tax the city of San Marcos has received this year as of June 2020 $23,810,725.20.

According to the agenda, the council will discuss six considerations of service level reductions:

1. Hold Vacancies
2. Reduce Public Facility Service Hours
3. Early Retirement
4. Staff Furloughs
5. Salary Reductions
6. Layoffs

The San Marcos City Council will meet virtually for their workshop at 5:30 PM. The proposed FY 2021 budget and 2020 Tax Rate is slated to come before council for approval in September.

• View this week’s agenda HERE.
• View this week’s agenda packet HERE.
• View live or previous meetings HERE.