Henderson OKs budget that includes property tax rate increase

The Henderson City Council unanimously approved a property tax rate increase Tuesday, part of efforts to balance a budget while suffering revenue declines because of the coronavirus.

The city will raise property taxes by 3 cents per $100 in assessed valuation, according to a presentation CFO Jim McIntosh gave council members. He said the increase will have no impact on almost all residents because of the property tax cap, which protects homeowners from annual increases greater than 3 percent.

“What we’re hoping to do with this is to begin capturing a lot of the new development that begins coming on the rolls, particularly some of the large commercial development that is about to occur here, or is about to go onto the property tax rolls here in Henderson,” he said.

McIntosh last month said city services have begun to “outstrip” the Henderson’s ability to pay for them.

Henderson will continue to have the lowest property tax rate of major Nevada cities, he said.

To balance its budget, Henderson could take up to $19 million from emergency reserves. The budget includes $281.5 million in general fund expenditures.

The novel coronavirus outbreak dealt a blow to Henderson’s revenue projections. The upcoming general fund budget has a projected revenue shortfall of about $37 million, McIntosh said. The fiscal year begins July 1.

Revenue shortfalls are based off of projections, so the city may have to adjust as real data comes in. Henderson is seeking federal assistance to deal with shortfalls, McIntosh said.

To fight off some of the fiscal effects, the city implemented a hiring freeze in April, McIntosh said. The freeze does not include public safety positions, McIntosh said.

Travel and training budgets have also been reduced.

“The more we’re able to save this year, the less we’ll have to cut potentially as we go into next year, or transfer from our stabilization fund,” he told council members.

Any request that went through the budgeting process has since been removed, he said. There are no new jobs or programs being added in the next budget.

Officials waived raises and bonuses, and the city has reached tentative agreements with three unions for one-year contract extensions that contain no cost of living raises. One remaining union, the Henderson Police Supervisors Association, is still in negotiations. A council vote on the contracts is expected next month.

Those cuts, however, will not be enough to fill the revenue shortfall. The city will use money from a reserve fund to cover shortfalls. McIntosh told council members he hopes the city does not need to transfer the full $19 million, but the reserve buys time to make more strategic cuts.

Contact Blake Apgar at bapgar@reviewjournal.com or 702-387-5298. Follow @blakeapgar on Twitter.