CAFR is an acronym for Comprehensive Annual Financial Report, and it is where the "real" numbers of city business are held. Well, sort of. You'll be hard pressed to find out exact expenditures but you will see overall budgeting and totals.
Let's tackle one sneaky way the city increases your taxes paid to them.
As you can see from the image, the city breaks down their tax rate into two sections - debt service and basic rate. How taxes are supposed to work is that when debt is paid down, the city should reduce the basic rate by that amount. Except, the City of Wylie has been raking that extra dough in, thus knowingly increasing our taxes.
This can be witnessed when comparing the last ten years of tax revenue by source. According to the 2016 CAFR, Wylie's Ad Valorem (a fancy way of saying property tax) increased 107.2%, Sales Tax increased 111.3%, and franchise taxes increased 39.7%.
In fact, the total tax revenue increase since 2007 has been 101%.
So it begs to be asked, wasn't the city supposed to take the tax burden off of homeowners, once they started realizing increases in sales and franchise tax revenue from all the businesses moving in? Well, that is how a well-run city is supposed to do it anyway.
When we look at excess fund balances on Wylie's 2015 CAFR, the ending fund balance was $29,183,358. Since they only banked $631,077 over the previous year they likely spent the excess tax revenue windfall from increased property, sales and franchise taxes.
On Wylie's 2016 CAFR, the ending fund balance is $32,335,323 and they banked $3,151,965 over the previous year, which likely means they put the $2.9 million property, sales and franchise tax revenue windfall in the bank.
Notice how Wylie's financial position improves from year to year. So much for taxing entities being not for profit.
With all those extra funds Wylie is realizing, it shouldn't be a stretch to the imagination to see the sandbagging that takes place during the budget season year after year. This is done to purposely keep our tax rate artificially high. The funds are either spent or put in the bank; they don't just magically disappear.
Below is a fine piece of sandbagging presented by our city manager for the 2016 budget. Note that each year the City Manager presents a budget that starts out lower in revenue and ends dramatically higher.
Expenses conveniently end at a deficit (for example in 2016 the city manager's office overspent by $35K and combined services/general overspent by $393K). Things like public safety, urban development and streets start high and end low as those numbers are sandbagged in the budget.
An example of this can be seen in public safety where they sandbagged with over $18.1 million budgeted but actually only spent $17.5 million.
Last week some of Wylie's astute taxpayers met and studied the CAFR. The result of this meeting is that they identified that the city has more than enough funds in their budget to cover a healthy tax decrease.
Because of this, Wylie taxpayers are demanding the budget be "rightsized" this year by:
- Adopting the effective tax rate
- Promising to reduce the basic rate as debt service is paid off from here forward
- Giving taxpayers an additional reduction of ten cents, which is in line with many of the North Texas cities similar in size
Nothing less will be acceptable.
So while the city council and administrators pick themselves up from the floor, here are a few other requests.
- The city manager should come to council with a reasonable budget, abruptly ending the sandbag show, or she should be fired
- A contrite council needs to vote for the substantial tax break outlined above
- Mayor Eric Hogue needs to apologize for bending us all over for years, while on his watch