City of Murphy Budget Work Session - July 31, 2025
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City of Murphy Budget Work Session - July 31, 2025
The City of Murphy held a budget work session on July 31, 2025, at 6:00 PM, with all council members present. The meeting focused on approving certificates of obligation, discussing utility rates, property tax rates, personnel restructuring, and one-time expenditures. The meeting adjourned at 7:12 PM.
Certificates of Obligation (Item 3A)
- The city approved the issuance of $17.62 million in certificates of obligation (Series 2025) with a premium of $765,000, netting $18.385 million. The bonds carry a fixed interest rate of 4.45% over 20 years and are callable in approximately 9 years. The city maintained its AA+ credit rating from Standard & Poor's. The sale was competitive with four bids received; BOK Financial Securities was the purchaser. The debt service will not require an increase to the interest and sinking (I&S) tax rate. The motion passed unanimously.
Utility Rates (Item 3B)
- Staff presented three scenarios for water and wastewater rate adjustments to maintain self-sufficiency over five years:
- Scenario 1: Increase base and volume rates, resulting in a 5.75% water increase, 4.69% wastewater increase, overall 10.44% increase. For a 10,000-gallon user, the monthly bill would increase by $8.01.
- Scenario 2: Increase rates in 2026 and 2029 only, with a 12.9% water increase and 10.53% wastewater increase, overall 10.44% increase, resulting in a $17.78 monthly increase for a 10,000-gallon user.
- Scenario 3: No change to base rates, only tier increases, with an overall 14.91% increase and a $6.97 monthly increase for a 10,000-gallon user.
- Council directed staff to proceed with Scenario 3, noting that the base rate remains unchanged. The final utility rate vote will occur on September 2, 2025.
Property Tax Rate
- The proposed FY2026 property tax rate is the voter approval rate, with a total rate of $0.35 per $100 valuation (M&O $0.26, I&S flat). The average homestead market value decreased, but the total tax levy increases by 4.5%. The M&O rate decreased from $0.30 to $0.26, while the I&S rate remains unchanged. The voter approval tax rate is expected to generate approximately $419,000 in additional revenue, increasing the average household tax bill by $123 per year ($11 per month). Council agreed to the proposed tax rate, with formal adoption scheduled for August 19, 2025.
Personnel Restructure (Fire Department Reclassification)
- Staff presented three options for fire department rank reclassification:
- Option 1: Reclassify drivers to lieutenants and captains to battalion chiefs, with a battalion chief vehicle. Financial impact: $25,500 in year one, $51,000 annually thereafter.
- Option 2: Same pay increases as Option 1 but retain the title of captain for the scene commander.
- Option 3: No change.
- After discussion, council voted 4-2 in favor of Option 1, citing the need for command authority on multi-company scenes, career growth opportunities, and improved training and professionalism. The motion carried.
One-Time Expenditures
- Council approved a list of one-time general fund expenditures totaling $445,000, including items such as rescue equipment replacement, fire station mattress replacement, active shooter training, Wi-Fi access point refresh, executive team retreat, and the Renter Road Tall Tree project. The budgeted expenditures exceed the one-time requests by $498,000, funded from the general fund reserve. Council expressed no concerns and approved spending from reserves.
Key Outcomes
- Certificates of Obligation: Approved unanimously (7-0).
- Utility Rates: Direction given to proceed with Scenario 3; formal vote on September 2, 2025.
- Property Tax Rate: Council agreed to the voter approval tax rate; formal adoption on August 19, 2025.
- Fire Department Reclassification: Approved Option 1 (battalion chief title) by a vote of 4-2.
- One-Time Expenditures: Approved with the understanding that $498,000 above the listed items will be drawn from reserves.
- Next Steps: File proposed budget by August 13, 2025; adopt tax rate by August 19, 2025; final public hearing and budget adoption by September 17, 2025.
Meeting Transcript
Alright, welcome to the July 31st City of Murphy budget work session. The time is 6 p.m. I'll turn the time of the city sector. Roll call and certification of the court. Mayor Scott Radley? Here. Mayor Hilton Paperham? Here. Deputy Mayor Proton Janay Butler. Here, Councilmember Play 2 Scott Smith. Here. Council member play three. Andrew Ch. Councilmember Play Court and Holder. Here. Councilmember Place Five Lord Deal? Here. Mayor certified approved for the college. Thank you. All right. We're going to uh move directly into item three, discussion and action items. Texas tax and waterworks and sewer system. Limited pledge, revenue certificates of obligation. Series 2025, providing that the payment of such certificates of obligation by the levy of an advalorum tax upon the taxable property within the city. Uh uh within the city and a limited pledge with the net revenue derived from the operation of the city's waterworks and sewer system and resolving other matters coincidence and relating to the issuance, payment security, sale, and delivery of such certificate certificates, and providing an effective date. Yeah, I was just gonna I wanted to make a couple of uh comments. Perry Elliott, our fire chief, is dialed in. He can hear us, he can see us, we can hear him, but we just can't see him. Uh so keep that in mind as we get further into the conversation. So don't talk about them. Yeah, say only nice things. Uh but Jason Hughes is here, so we're actually just going to turn it over to him. So we don't we don't have to talk nice about him though. Jason, how are you doing today? I'm doing well, Mayor. So good to be here. Chris Deborah is also here from North Fulbright. He is the city's bond council. So a pleasure to be here. I have before you what you have uh in front of you is exactly what is up here on the screen, which is just a summary of the bond sale or the certificate of modification sales that we undertook this. So we actually put competitive bids at 10 o'clock this morning. The city received four bids, and again, the summary as well go through here. This is basically the second step. If you recall on May 20th, you approved a notice of intent. You approved that actually for 23 million after that or subsequently after that, uh, some of the projects were kind of scaled back or taken off, so we have a slightly lower amount. But again, this is basically the continuation of uh the first thing, first step that you took on May 20th. So one of the first things that we did is we did go to standard four. We got a credit rating. They did affirm the double A plus, and that is the second highest credit rating you can have, so just one step below the triple A. So that is a fantastic credit rating.
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