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By Mary Ellen Leonard, Director of Fiscal Services
The City of College Station's proposed budget for Fiscal Year 2027 is a strategic blueprint, but it is also a stark reminder of the financial pressures facing our growing community.
Presented to the City Council at a special Monday meeting, the $576.4 million budget outlines how we will maintain high-quality daily services and invest in core infrastructure, all while navigating strict regulatory revenue limits, rising inflationary costs, and no new debt capacity.
The total budget splits into two primary buckets:
- $394.8 million for operations and maintenance (everyday city services).
- $181.6 million for capital improvements (building for the future).
A Balanced Long Game
The General Fund forecast projects $134.1 million in recurring revenues against $133.8 million in recurring expenses, resulting in a balanced budget as mandated by the College Station City Charter.
Good governance means looking beyond next year, and our five-year financial forecast highlights long-term pressures looming on the horizon. For example, we are already engineering a solution for FY29, when the federal SAFER grants that fund staffing for Fire Station No. 7 are set to expire. Identifying this funding gap now is critical to avoid service disruptions later.
Your Wallet: Tax Caps and Inflation
Managing City revenues has become an increasingly complex challenge due to legislative constraints, shifting economic conditions, and growing service demands.
- Property Taxes: Despite these moving targets and external pressures, the City is committed to increasing operating revenue by only the 3.5% permitted by law to balance the FY27 budget. Staff continues to review valuation data, and the proposed property tax rate will come forward later in the budget process once final numbers are received from the Brazos Central Appraisal District and the Brazos County Tax Assessor-Collector's Office. Your total tax bill is determined by your taxable property value just as much as the tax rate itself.
The FY27 budget estimates an operations and maintenance property tax levy of $51.2 million. The projected revenue increase is driven by an additional 3.56% in new taxable value, and one needs only look at the changing skyline in the Northgate area to see that physical growth. At the same time, new exemptions mandated by the state legislature are altering our local tax formulas. They may artificially drive up both the minimum no-new revenue rate and the maximum voter-approval rate this year. Total property tax revenues are estimated to be $84.2 million.
- Sales and Hotel Taxes: We project a modest 2% nominal growth for sales tax, generating about $535,000 in new revenue. When adjusted for inflation, actual purchasing power may dip slightly, reinforcing the need for caution regarding recurring spending. Hotel occupancy taxes are also projected to grow by 2%, driven heavily by Texas A&M sports and premier regional events.
- Your Utility Bill: No rate increases are proposed for metered electric, water or wastewater services. To keep pace with inflation, roadway maintenance and drainage fees will increase by 3%, and solid waste rates will increase by 5%. The total impact on the average household utility bill will be about $1.88 per month.
Public Safety First
Public safety remains our core responsibility, requiring continuous investment even in a tight budget year to meet growing community demands and strengthen local engagement:
- Police expansion: Funding for six additional police officers with vehicles, plus a new police volunteer coordinator.
- Personnel retention: To remain competitive, continued annual step increases and a 3% cost-of-living adjustment for public safety personnel.
Infrastructure and Capital Projects
Capital investment is the cornerstone of College Station's future, but our capacity is stretched. Of the $181.6 million in capital funding for FY27, our five-year capital plan includes $169.4 million in new projects.
Key Project Highlights:
- Public Works Facility: $55 million for construction.
- Midtown Infrastructure: $35.9 million total, including $14 million for roads, $5 million for water utilities, and $16.2 million for Phase 2 of Texas Independence Park.
- Parks and Recreation: $7 million for Wolf Pen Creek improvements and $5 million for neighborhood parks.
- Mobility and Safety: Funding for drainage, traffic signals, sidewalks, trail expansions, and a potential University Drive pedestrian crossing.
- Northgate: $5 million for district improvements, surface lot resurfacing, and garage signage.
Supporting Our Workforce
To attract and keep top talent in a highly competitive job market, our proposed pay strategy invests heavily in the personnel who keep College Station running, despite broader budget tightening:
- A 3% across-the-board pay scale increase for all employees.
- A 1% market adjustment for non-step employees, alongside a merit pool for top performers.
- No increases to health insurance premiums for either employees or the City.
We are also adding targeted, crucial positions to manage rapid physical growth, including personnel for a new Street Concrete crew, an engineering technician, a building inspector, a Parks irrigation crew leader, a capital projects field administrator, a human resources generalist, and an IT security analyst.
Targeted Investments, Community Partners
- Smart Operations and Tech: The budget accounts for $2.8 million in one-time General Fund requests, including $1 million for critical software updates (document management, identity verification, and learning systems). Other operational necessities include advanced water leak detection, a mini street sweeper, an electric safety position, and flood study updates for FEMA map revisions.
- Community Agency Support: We continue to partner with local organizations that align with City Council goals. Outside agency funding requests total $3.8 million for partners, including the Aggieland Humane Society, Brazos County Health Department, and the Arts Center of the Brazos Valley. Final funding determinations will be made during upcoming budget workshops.
On the debt side, the budget includes a planned $5.8 million defeasance to pay off the 2014 General Obligation bonds ahead of schedule, saving the city money on interest. However, due to critical, council-directed capital projects already underway, the city must maintain its existing debt levy rate. As a result, the city will have no new debt capacity beyond what has already been forecast until FY34.
Budget Timeline
We want to hear from you as we navigate these financial challenges together. Here is how you can follow and participate in the FY27 budget adoption process:
- July 13–15: Public budget workshops
- July 23: Public hearing on the budget
- August 13: Voter-approval and no-new-revenue tax rates submitted to Council
- August 27: Public hearing on the tax rate, followed by official budget and tax rate adoption
- October 1: FY27 fiscal year begins
Review the complete documentation and stay up to date by visiting cstx.gov/budget.
About the Blogger
Mary Ellen Leonard has been the ccity'sdirector of fiscal services since 2016. She previously was the chief financial officer for the Grub Burger Bar restaurant chain and operated her accounting firm for 14 years. A CPA since 1988, Mary Ellen has also served as a senior manager at Accenture and Arthur Andersen, CFO at Devereux Hospital, and senior financial analyst at Tenneco Gas Pipeline. She earned a degree in accounting from Texas A&M in 1986.
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