The city of Waco’s proposed budget for 2010-11 calls for no tax hikes, a decrease in general fund spending and significant rate hikes for water and sewer customers.

City Manager Larry Groth presented what he called a “status quo” budget Tuesday to the Waco City Council, which will vote on it Aug. 17.

Groth said property tax revenue is expected to increase only 1.9 percent this year, the smallest increase in more than a decade.

City Manager Larry Groth presented what he called a “status quo” budget.
Rod Aydelotte/Waco Tribune-Herald, file

Sales tax revenue is expected to be flat because of the economy and franchise fees from utility companies are expected to be down $1 million.

“We are still very blessed in Waco, not having to ask for a tax increase,” Groth said. “Throughout the nation, cities are struggling.”

The tax-supported general fund, which supports public safety, parks, administration, libraries, streets and other basic services, is expected to decrease for the first time in well over a decade.

General fund spending is expected to decrease from $98.7 million to $96 million.

But Groth said the city isn’t planning to lay off or furlough anyone and the city is adding 9.4 full-time equivalent positions, some of which will be assigned to maintain Rosemound Cemetery.

Groth said the city can’t afford raises this year for employees, but he asked the council to reward employees with an extra vacation day, bringing the total to 10 days.

Meanwhile, the city is planning the first water and sewer rate hikes since the 2007-08 budget year.

New rate structures would lower the base rate for sewer by $1.50 a month and water by $1 a month. But the city would begin charging the regular amount for a household’s first 2,000 gallons, which now are included at no extra charge.

The typical water customer, using 7,000 gallons a month, would see his bill jump from $28.70 to $32.78, an increase of $4.08 or 14 percent.

A sewer customer billed for 5,000 gallons a month would see his bill increase from $23.17 to $27.45. That is a difference of $4.28, or 18 percent.

Those using 1,000 gallons of water would see a 10 percent increase, while consumers of 15,000 gallons would see an 8 percent increase.

The water and sewer departments each would bring in an additional $1.7 million from the rate hikes.

City officials said the rate hikes are necessary to cover major infrastructure projects the city is building around town, including the new dissolved air flotation treatment plant, sewer plant expansions and new transmission lines.

In addition, the water department is projecting a budget shortfall this year of $1.4 million, largely because of a wet spring and early summer that has curtailed outdoor watering.

In its business session Tuesday, the council:

*  Rezoned the 600 block of Mary Avenue from industrial to commercial at the request of 921 Partners, a Waco limited partnership that is planning to build a mixed-use retail and residential development there.

*  Awarded a $9.6 million contract to Archer Western of Arlington to build the Bull Hide Creek sewer plant near Lorena. The project is funded by the Waco Metropolitan Area Regional Sewer System, of which Waco is the largest member.

*  Awarded $110,785 to Alpha Contractors of Temple to build a 6-foot-wide sidewalk on the north side of Waco Drive between North 13th and North 17th streets.

*  Approved a $70,188 contract for restoration services at Hillcrest Tower, future home of the Waco Police Department. A hot water heater on the ninth floor burst June 28, and water trickled down several floors, damaging floors, ceilings and walls.

jbsmith@wacotrib.com

757-5752

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