Truth-in-taxation is a concept embodied in the Texas Constitution and the Tax Code that requires local taxing units to make taxpayers aware of tax rate proposals. If the proposed tax rate exceeds the lower of the no-new-revenue rate or the voter-approval rate, the City Council must hold a record vote to set the proposed tax rate (Tex. Tax Code § §26.06(c) and 26.061) . The vote to set the proposed tax rate was held on August 10, 2026. In order to maintain maximum flexibility, the proposed rate was set to the voter-approval rate level which exceeded the no-new-revenue rate. Subsequently, since that approved proposed tax rate exceeds the lower of the no-new-revenue rate or voter-approval rate, the governing body must hold a public hearing prior to the adoption of the tax rate (Tex. Tax Code §26.06(a)) . Following review of the City Manager’s proposed budget and discussion during the Council Work Session, the final tax rate proposed for adoption is the rate included in the City Manager’s proposed budget, which is below the no-new-revenue rate and the voter-approval rate. The higher rate initially set by Council was intended to preserve flexibility during the remainder of the budget process and is not the rate now proposed for adoption.

Bastiat Liberty & Property Rights Analysis

This motion is scored as EXPANDS_GOVERNMENT (Impact Weight: 8.8/10). Under the Bastiat Liberty Watchdog Index, measures that increase tax rates or fee schedules, issue new debt or Certificates of Obligation, expand regulatory/zoning restrictions on private land use, or authorize unbudgeted spending expansions reduce an official's Freedom Score when voted YES (and reward dissenting NO votes).