UPDATE: This article has been updated to reflect the correct date of August 20, 2021 for the next public hearing regarding the adoption of the budget and the tax rate.
By: Jessica Shorten
CONROE, TX – The Montgomery County Commissioners Court approved the “No New Revenue” tax rate after wrapping up a third and final day of the 2022 budget workshop on Thursday, July 29, 2021.
In a unanimous vote, Commissioners approved a tax rate of .4083 cents per $100 of property valuation, which is 2.36 cents lower than the current property tax rate of .4319 cents per $100 of taxable property value.
The lower tax rate doesn’t mean the check you write for property taxes will decrease. Since property values increased, the “No New Revenue” tax rate is the rate at which the higher property value maintains the property taxes paid at the same level as last year.
However, the “No New Revenue” tax rate passed by Commissioners Court only applies to the Montgomery County portion of the property tax bill. Cities, school districts, MUDs, Emergency Service Districts, the Montgomery County Hospital District, and Lone Star College are in the process of setting their budgets and tax rate. If any of these entities select a tax rate higher than the calculated “No New Revenue” tax rate for their jurisdiction, then the check written for property taxes will still be higher.
Due to growth, new homes and businesses were added to the tax rolls, rounding out the 8.4% increase in certified taxable values presented by Tax Assessor-Collector Tammy McRae.
However, the extra property taxes generated by new property was quickly spoken for by Precinct 3 Commissioner James Noack, who vehemently pursued a 5% salary increase, which completely used the excess funding in the budget to the point the Commissioners each had to take $200,000 out of their personal budgets to make up the difference. From there, Commissioners’ Court worked diligently to figure out how they could make up funding to cover numerous law enforcement and department employee requests.
Most of the law enforcement requests were fulfilled in a combination of ARPA funding and from the Commissioners’ budgets. Including mental health deputies for Precinct 1 Constable and two deputies to create an animal cruelty division in the Precinct 2 Constable’s Office.
After dedicating $15 million of the county’s fund balance to cover Capital Improvement Projects and Capital Outlay projects, the Court decided to find any way possible to use American Rescue Plan Act (ARPA) funds to cover the new expenses. However, County Attorney B.D. Griffin and Civil Division Chief Amy Dunham repeatedly warned the Court against stretching ARPA definitions to cover items like IT professionals and government employees.
Because ARPA funds are subject to federal auditing and clawback standards, if Montgomery County uses the funds for something not covered, the County would be on the hook to repay the money. However, County Judge Mark Keough, who advocated for the extensive use of the ARPA funding grants, expressed the County would be able to repay any potential clawback through future revenue.
Since Commissioners adopted the No New Revenue rate, there will not be a public hearing for citizens to comment on the tax rate. However, a public hearing is still required before final approval of the budget, and is scheduled for August 20, 2021 at 9:30 a.m.
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