Page 15 - City of McAllen - Approved Annual Budget Book FY 24-25

Adopted Budget 2025 City of McAllen, Texas

McAllen Tax Rate; Overall Impact on Citizens’ Ad Valorem Taxes

In Tax Year 2024, the city reduced its property tax rate to $0�449989 per $100 of valuation� This is a savings for
taxpayers helping boost household balance sheets� For property owners, the home is not only hearth and shelter
but also typically their biggest asset� Housing across the United States has seen high mortgage rates, elevated
home prices, and constrained inventory� Even with increased prices locally, McAllen remains an attractive place to
reside offering a high quality of life, but with costs of living much more affordable than other metros in Texas and
the rest of the nation�

Overall revenues
In addition to the Sales Tax and Property Tax revenues, the City will continue to utilize dedicated revenue for specific
purpose� Details of this revenues are listed in the Executive Summary section on pages 17-20�

CURRENT YEAR ISSUES

This year, we are anticipating that General Fund revenues will increase by 3% over last year’s adjusted budget� When
compared to the preceding FY 22-23, revenues increased by 3�74%� Transfers-in are budgeted to decrease by -2%
due to a one-time transfer from the Property and Casualty Fund�
In this year’s budget, expenditures were increased by $6M or 4% over last year’s adjusted budget� This increase in
expenditures was adopted while taking into consideration the anticipated revenue increases and maintaining a
healthy fund balance� Refer to pages 17-32 of the Executive Summary for additional information�

During the budget process, several issues were raised:

Personnel-Related Issues
Employee Pay Raises and Longevity Pay

This year’s budget provides a 3�5% increase in Cost-of-Living Adjustment and includes Longevity Pay to eligible full-
time, regular, non-civil service employees based on an employee’s length of service�

Living Wage Issue

In addition to the City funding skilled-job training to promote higher paying jobs, it has taken the lead in setting an
example by raising the City minimum wage rate for full-time as well as part-time employees to $13�5959 per hour�

City Retirement Plan (TMRS) Funding
The City’s contribution rate for the City of McAllen for calendar year 2024 and 2025 was 8�61% and 8�39%, respectively
for a blended rate for the fiscal year 2024-25 of 8.45%. The plan is almost fully funded with a funded ratio of 94.8%.

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