City Budget Proposal Shows 4% Tax Rate Increase for 2026
The Abilene City Commission reviewed the proposed 2026 budget during Monday's meeting, which includes a 4% increase in the property tax rate over current levels.
Interim City Manager Quinday presented the budget, explaining that the proposed tax rate for 2026 would be 47.537 mills, up from the current rate of 45.648 mills. Despite the increase, Quinday noted that the overall 2026 proposed budget is 6% or $1.2 million less than the 2024 budget.
The budget presentation highlighted several financial challenges facing the city, including declining fund balances from structural deficits accumulated over several years.
"Recognizing that each financial decision has long-term consequences for the community, the proposed budget takes a balanced approach, meeting essential service needs while laying the groundwork for restoring long-term fiscal stability for Abilene," Quinday told the commission.
The proposed budget includes significant cost-saving measures, including a reduction in workforce, no cost of living or merit-based pay increases for employees, and no capital investments or major equipment purchases beyond what the city is already obligated to in 2025 or 2026.
If approved, the general fund would receive approximately $2.4 million in property tax revenue (72% of total property tax levied), with the library receiving $580,000 (17%), debt service $191,000 (6%), and fire apparatus $170,000 (5%).
The general fund's unencumbered cash balance has been declining, from $1.9 million at the end of 2024 to a projected $290,000 by the end of 2026, even with the proposed tax increase and budget adjustments.
Commissioner Kollhoff expressed concerns about the tax increase, stating he would prefer to find additional cuts to achieve revenue neutrality rather than increasing taxes. "I don't want to make our spending problem our citizens' problem," he said.
Other commissioners noted that the city has maintained revenue neutrality for the past two years, with Mayor Rein pointing out that from 2020 to 2025, property tax levied funds have only increased citywide by about $100,000.
The commission voted to approve publication of the notice to exceed the revenue neutral rate and set a budget public hearing for September 8, 2025, at 4:00 p.m. Once published, the proposed tax rate and budget cannot be increased, though they can be reduced before final approval.
The commission will vote on the final budget after the public hearing.
