Hearings, budget/tax rate vote Sept. 28

By Rosanne Fohn

Anvil Herald Reporter

Hondo City Council held a public hearing on its 2026-27 budget Monday night, but postponed a hearing for the tax rate until Monday, Sept. 28, when that vote will be taken together with the vote on the 2026-27 fiscal year budget. 

The postponement was due to a technicality brought up by Michael McCann of Davidson, Troilo, Ream & Garza PC, the firm the city hires as its city attorney. Texas Tax Code Chapter 26.06 requires a vote within seven days of the tax rate public hearing. Rather than schedule a special meeting just to vote on the tax rate, the public hearing was rescheduled Sept. 28, when the public hearing on the tax rate and vote will be taken, after council votes on the budget. “It was a mistake on our part,” City Manager John Naron said.

Naron’s report to council noted that the proposed budget is $29,613,485, a 5% decrease from 2025; however, this budget will raise 7.2% -- $182,040 -- more total revenue. Of the new revenue to be raised, 7.27% -- $183,697 – will be from new property added to the tax roll this year. The budget is based on keeping the same tax rate of 48¢ per $100 valuation.

Employees are expected to receive a 3% across-the-board raise, with the minimum hourly wage to be $16.15. The budget strengthens the employee retirement plan and continues health coverage, he said. The number of employees is down slightly due to attrition.

The new budget calls for adding an assistant city manager, and through a reorganization of the police department, adding two police lieutenant positions instead of keeping the patrol sergeant and detective sergeant positions. Overall, the police department would have 27 instead of the 29 employees in the current fiscal year, with four officers assigned as school resource officers.

During the budget public hearing, citizen George Adams again compared Hondo to two nearby, similar-sized cities: Floresville and Pearsall. He said he disagrees with the Hondo Police Department’s restructuring and said the city could save money by having a “flatter” department structure, as is seen in Floresville and Pearsall.

City water/sewer rates are expected to jump by 11.75% and continue to climb over the next five years. At the budget workshop sessions over the summer, Naron explained that the water/sewer rates have not kept pace with inflation for the past 10 years. An increasing rate schedule was adopted by city council just before the COVID-19 pandemic, but was abandoned in the following years. 

According to the new water rate study commissioned from NewGen Strategies and Solutions, “In short, current rates are not sufficient to sustain the utilities over the planning period (the five years from 2026 through 2031 that were included in the rate study). Without adjustment the city would be unable to meet its debt service coverage and reserve requirements and would deplete its utility reserves within a few years.”  

Naron said that the General Fund expenditures are expected to be smaller this year, mainly due to several one-time grant funds being completed.

He added that council is focusing on improving infrastructure, with $500,000 earmarked over the next five years for street improvements. And instead of extending utilities to areas where the city wants to encourage growth, the city intends to focus on continuous improvements to all utilities within the developed areas of the city and “let new development carry the cost of the improvements it requires.”