San Marcos prepares to deliver proposed FY 2026-27 budget
San Marcos is approaching the next formal milestone in its FY 2026-27 budget process: the city is scheduled to deliver its proposed budget to City Council on August 18.
The submission follows budget workshops, community input and updates to financial information. It will not be the final budget. The city has scheduled a first reading and public hearing for September 1, followed by a final public hearing and adoption action on September 15.
What happens next
August 18 is the next major date for residents watching the city’s spending plan. City budget materials say the proposed budget will be delivered to Council that day after staff incorporates Council direction and updated financial information.
The city’s budget page still listed the FY 2027 proposed budget book, budget presentation and maximum-tax-rate presentation as coming soon. Until those materials are posted, figures discussed during the June 25 workshop should be treated as preliminary rather than final decisions.
The schedule identifies September 1 as the first reading of the budget and a public hearing. September 15 is set for the final public hearing and scheduled adoption of the budget, tax rate and capital-improvement plan.
Why the tax rate remains unsettled
At the June 25 budget workshop, city staff estimated a no-new-revenue property-tax rate of 65.50 cents per $100 of taxable value, compared with the current 65.15-cent rate. The estimate was based on preliminary appraisal information and was not a final tax-rate calculation.
The city said the final no-new-revenue and voter-approval tax-rate calculations depend on the certified appraisal rolls. Because the preliminary no-new-revenue estimate was close to the current rate, staff said the final calculation could end up lower than 65.15 cents once certified values are received.
Residents should not treat the preliminary estimate as a prediction of an individual property-tax bill. A household’s bill would also depend on its taxable value, exemptions, the final tax rate and the adopted budget.
Major questions identified in the workshop
One unresolved issue is whether the city will use fund balance above its policy target. San Marcos identifies a target equal to 25% of recurring operating expenses. The workshop discussed how any balance above that target might be handled, but no final use was approved during that discussion.
The developing budget also must account for approximately $775,000 in expiring federal funding identified in the workshop materials and research brief. That figure remains subject to refinement as staff completes the proposed budget. The decision will affect how the city handles ongoing costs, replacement funding and service levels.
Another major item is a proposed Emergency Medical Services department with estimated operating expenses of about $1.2 million. That amount was presented as a budget-planning figure, not as a final appropriation or completed department structure.
Staffing and workforce reductions were also part of the June discussion. The workshop presentation said the city had frozen 24 positions as of June 2026 and had eliminated 28 positions through a retirement-incentive program, with estimated annual savings of about $2.7 million. The final proposal will show how those measures affect departments, staffing levels and services.
How public input fits into the process
San Marcos held three budget town halls in May and June and also used a participatory-budgeting process. The city made $200,000 available for resident-directed projects during the cycle.
Participatory-budgeting projects must be public, accessible, low-maintenance and limited to one-time capital expenditures. That means the allocation is separate from ongoing operating costs such as salaries, department operations or recurring service expenses.
The city’s participatory-budgeting page says voting closed June 15. Resident proposals and voting results can inform project selection, but they do not make a specific project part of the adopted FY 2026-27 budget until the city completes its budget process.
What residents should watch
On August 18, residents should look for the proposed budget, the updated tax-rate calculations, the treatment of fund balance, the handling of expiring federal support, the proposed EMS costs, staffing measures and the participatory-budgeting projects.
The September 1 and September 15 meetings are the scheduled public-hearing opportunities before adoption. The distinction matters: August 18 is the proposed-budget submission; September 1 is the first reading and public hearing; and September 15 is the scheduled final public hearing and adoption action.
Residents can follow the city’s budget page and budget-engagement page for posted materials and meeting information, and can contact City Council or participate during the city’s citizen-comment process.
Sources
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