Bond Election 2023
It is important that all Jersey Village residents understand what is being voted on and how much the approval of the Propositions would increase our property taxes. The city has provided a lot of information about where the bond money would be used if each of the three propositions are approved by the voters; however, only what is defined within each of those propositions provides any controls on how those funds can be used. Please read the actual wording in each proposition just like you would if they were for contract work at your house.
All three propositions include the same wording regarding the selling of bonds for the financing of the various projects. They would be sold on the Bond Market at the current bond market interest rates at the time of the sale. All bonds sold would be backed by property taxes for up to 40 years. The interest rate(s) cannot be known at this time or any time prior to the sale of the bonds; therefore, the true impact on future property tax rates cannot be known. The estimates of tax rates provided within the city documents are only their suggestion and they do not determine what the future tax rates may be set for each tax year. The examples provided for tax rates in future years are unclear as to what they would be if one or more of the propositions were not approved by the voters. What if one is approved and the other two fail?
The proposed bonds are:
CITY OF JERSEY VILLAGE, TEXAS – PROPOSITION A
Shall the City Council of the City of Jersey Village, Texas (the “City”) be authorized to issue bonds, in one or more series, in a principal amount not to exceed $19,000,000 maturing serially or otherwise over a period of years (not to exceed the lesser of 40 years or the maximum prescribed by law) and bearing interest at such rate or rates (fixed, floating, variable or otherwise), not to exceed the respective limits prescribed by law at the time of issuance, as shall be determined within the discretion of the City Council at the time of issuance, and to levy, impose and pledge a tax upon all taxable property in the City sufficient to pay the interest on the bonds, and to provide a sinking fund for the payment of the bonds as they mature, for the purpose of making permanent public improvements, as follows: constructing, acquiring, improving, renovating, expanding, developing and equipping parks and recreation projects, including the acquisition and construction of a municipal pool, and all matters incident or necessary thereto?
What does that mean?
Based on the survey conducted by the city, this bond includes but is not limited to upgrading the pool to have water slides, a lap pool, a water bucket, and possible rental cabanas. It also includes a skate park and upgrading the fields at Clark Henry Park with lights, updated game fields and renovating the concession stand and bathrooms.
If Proposition A is approved, the city can sell bonds in the amount of $19,000,000. The wording of this proposition gives Jersey Village City Council the authority to use that $19 million for any purpose if the funds are for parks and recreation projects. As written, the project(s) could be at any location and could be used to build a baseball stadium or additional projects involving the golf course or anything else they define as parks and recreation.
Proposition A should be rejected by the voters because it is the same as giving them a blank check for $19 million with your property taxes as the payee.
CITY OF JERSEY VILLAGE, TEXAS – PROPOSITION B
Shall the City Council of the City of Jersey Village, Texas (the “City”) be authorized to issue bonds, in one or more series, in a principal amount not to exceed $15,855,000 maturing serially or otherwise over a period of years (not to exceed the lesser of 40 years or the maximum prescribed by law) and bearing interest at such rate or rates (fixed, floating, variable or otherwise), not to exceed the respective limits prescribed by law at the time of issuance, as shall be determined within the discretion of the City Council at the time of issuance, and to levy, impose and pledge a tax upon all taxable property in the City sufficient to pay the interest on the bonds, and to provide a sinking fund for the payment of the bonds as they mature, for the purpose of making permanent public improvements, as follows: constructing, acquiring, improving, renovating, expanding, developing and equipping water, sewer and drainage projects, and all matters incident or necessary thereto?
What does that mean?
Based on the survey conducted by the city, this bond includes but is not limited to fixing the sewer lines that are old in parts of the city, adding sewer and water services within the ETJ area across 290 for selected land parcels, and the land purchased by the city during a lawsuit due to rezoning.
If Proposition B is approved, the city can sell bonds in the amount of $15,855,000. The wording in this proposition gives Jersey Village City Council the authority to use that $15.855 million for any purpose if the funds are for making permanent public improvements involving projects like water, sewer, and drainage projects. As written, the project(s) could be at any location and could be used to construct water, sewer, and drainage outside of the current city limits and within the ETJ including the proposed baseball stadium.
Proposition B should be rejected by the voters because it is the same as giving them a blank check for $15.855 million with your property taxes as the payee.
CITY OF JERSEY VILLAGE, TEXAS – PROPOSITION C
Shall the City Council of the City of Jersey Village, Texas (the “City”) be authorized to issue bonds, in one or more series, in a principal amount not to exceed $18,045,000 maturing serially or otherwise over a period of years (not to exceed the lesser of 40 years or the maximum prescribed by law) and bearing interest at such rate or rates (fixed, floating, variable or otherwise), not to exceed the respective limits prescribed by law at the time of issuance, as shall be determined within the discretion of the City Council at the time of issuance, and to levy, impose and pledge a tax upon all taxable property in the City sufficient to pay the interest on the bonds, and to provide a sinking fund for the payment of the bonds as they mature, for the purpose of making permanent public improvements, as follows: constructing, acquiring, improving, renovating, expanding, developing and equipping street, road and bridge projects, and all matters incident or necessary thereto?
What does that mean?
Based on the survey conducted by the city, this bond includes but is not limited to building a drivable bridge on Rio Grande to give access to the cars coming into JV to access Post Elementary and JV High School.
If Proposition C is approved, the city can sell bonds in the amount of $18,045,000. The wording in this proposition gives Jersey Village City Council the authority to use that $18.045 million for any purpose if the funds are for the purpose of making permanent public improvements, as follows: constructing, acquiring, improving, renovating, expanding, developing, and equipping street, road and bridge projects, and all matters incident or necessary. As written, the project(s) could be at any location and could be used to construct streets or bridges in any area within the city or outside of the current city limits and within the ETJ including the proposed baseball stadium.
Proposition C should be rejected by the voters because it is the same as giving them a blank check for $18.045 million with your property taxes as the payee.
Impact on residential property taxes:
The city documents provide estimated impact to property taxes showing tax rates for years 2024, 2025, 2026, 2027, and 2028; however, nothing within the propositions provides any control over what the city council could set as the tax rates for those years. The approval of any of the bond propositions does give them authority to increase the residential property taxes to pay for the new city debt.
The property tax estimates provided within the document provided by the city are misleading in multiple ways. The tax rates shown in the city documentation are suggestions, but as stated above, the city council sets the tax rate each year and they are not restricted to those shown in their documentation. Their chart also assumes that the property values for your home will not increase from year to year and most of the homes in Jersey Village have seen an increase of at least ten percent each of the last five or more years. Their chart also assumes that each home gets the Homestead Exemption that reduces the taxable value. The chart also shows the tax rate being reduced for the years 2027 and 2028 without an explanation. Current city debt should be paid off by that date; therefore, reducing the amount required for that debt. Without more debt, the tax rates would have to be reduced by state law, but that is not explained by the city.
Review the Ten-Year Property Tax Chart – Jersey Village Neighbors (jvccc.org) to see the impact on residential property taxes based on an assumed increase in taxable values of ten percent for each of the next ten years. The values shown in the chart are after all exemptions have been applied because that is the amount used to calculate your property taxes. This chart is for only the JV taxes. The three tax rates shown are the current JV Tax rate, the JV minimum tax rate (+.0925), and the JV higher tax rate (+.1025) assuming the voters approve the propositions. Those rates were provided by the city in their documents; however, they place no legal restrictions on the rates set by the city council.
Summary Recommendation:
We do understand that there are areas within Jersey Village that need some improvements and those improvements require money. However, all three of the propositions as written become blank checks that give wide authority to take the city into debt of almost $53 million with only a few restrictions on how those funds could be used. Regardless of how you view those currently elected to the city council or your expectations of those future members, these propositions need to be rejected. The city council recently started construction at the golf course using $9 million of funds accumulated over years without any approval by the voters. Projects involving millions should have voter approval and not just the votes of five people. That $9 million plus the other $11 million they still have available could have been used for critical needs like proper maintenance of city facilities before they “must be” replaced.
How will the bonds affect your bottom line and increase your taxes:
The spreadsheet shows the calculated taxes for homes with taxable values of $200,000, $250,000, $300,000, $350,000, $400,000, and $450,000 for year zero through year ten. The home taxable shows a ten percent increase for each year based on what HCAD has been doing for the past several years. These taxable values assume all exemptions have been applied. The current JV Tax Rate is 0.7425. The suggested low bond rate increase of 0.0925 would take the tax rate equal to 0.8350 and the high bond rate increase of 0.1025 would take the tax rate equal to 0.8450.
The Ten-Year Property Tax Chart assumes the year 0 is the base taxable value and shows the tax rate increase impact on that amount. For each year going forward, the value is increased by 10% more with each of the three rates used to calculate the tax amount for that year. The totals column is the total amount of taxes from year 0 through year 10, which is 11 years of taxes for each tax rate. The INCR column is the amount of increase in taxes paid over the current tax rate.
Using $300,000 as an example and applying the new rates shows increases in taxes of $277 for the low bond increase and $307 for the high bond increase. By year 10 the taxable value would be $778,123 and the difference would be $719 and $797 per year. The accumulated increase in taxes paid over the 11-year period is $5,142 and $5,698. These amounts are 12.44% and 13.79% increases over the base tax amounts for each year and that size of tax increase requires voter approval by Texas laws.