Cottonwood Shores approves $4.2 million budget; no tax rate increase
Cottonwood Shores City Council approved a $4.2 million budget for the 2026-27 fiscal year, a slight increase from the previous year that keeps the city’s property tax rate unchanged.
Last year’s budget, for the 2025-26 fiscal year, was the first time the city exceeded $4 million.
The new budget increases the general fund by about 7 percent, from $1.97 million to $2.11 million.
Most of the city’s revenue comes from property taxes and General Fund sales taxes, which account for 37.1 percent and 24.3 percent of total revenue.
The council approved the budget Sept. 10. The new fiscal year begins Oct. 1 and ends Sept. 30, 2027.
TAX RATE
The city’s property tax rate will remain at $0.4998 per $100 of property valuation, the same rate as the 2025-26 fiscal year and below rates in previous years. While the tax rate did not rise, property values did, and owners may see a rise in property tax payments.
“Reducing or having no change in the tax rate, continues a trend the last three years of holding the line or reducing the tax rate, when it was at $0.5162 per $100 in value back in the 2023 tax year,” City Manager J.C. Hughes told DailyTrib.
The adopted rate includes $0.3283 per $100 for the general fund and $0.1715 for the interest and sinking fund, which covers existing debt service.
The budget includes a 3.5 percent cost-of-living adjustment for city employees and funding for two new part-time fire department employees as a first step toward creating a city combination fire department. In the meantime, the city will continue its temporary contract with the Horseshoe Bay Fire Department for fire, EMS and rescue services.
Residents will see a 4-percent increase in utility rates and a 5-percent increase in solid waste rates beginning Oct. 1. The increases are due to higher fuel, chemical, material and supply costs according to the city.
“Fuel costs have greatly raised the cost for all materials and supplies used by the city,” Hughes said.