City Hall Roundup: Property Values Jump, Sales Tax Revenues Drop
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I’m sure everyone’s sick and tired of hearing about budget season at Dallas City Hall, especially since it hasn’t even really started yet.
Nevertheless, it’s a critical period for every local government’s calendar. And it doesn’t hurt for taxpayers to be familiar with their city’s finances and plans on spending for the year, especially if you’re a homeowner.
Staff have published a timeline with important milestones between now and September 17, when council members will vote to adopt a budget for FY 2025-2026. That budget will go into effect on October 1, the start of the fiscal year.
Some memos dropped in July that also warrant coverage as their contents will directly impact municipal finances at City Hall.
Dallas Property Values Keep Growing
Every July, the four county appraisal districts in which Dallas proper is situated certify property values for the year. City officials then use the values to devise a property tax rate and budget for the coming fiscal year.
According to the appraisal districts’ data, property values totaled $226.4 billion for 2025. In 2024, the total was $215.1 billion. Appraisers clocked an $11.3 billion increase in value, marking a 5.3% spike from the year before. New construction accounted for $4 billion of the increase.
“We are now working with Dallas County Tax Office to calculate the no-new-revenue tax rate and voter-approval tax rate, which are both based on the certified value,” Dallas CFO Jack Ireland wrote to city council members in a memo showing the valuations.
Local taxing bodies (cities, counties, school districts, etc) are required by the Texas Constitution to inform taxpayers on their tax rate proposals in accordance with the state’s Truth in Taxation laws, which are meant to force public transparency and empower taxpayers to challenge unreasonable or unnecessary tax increases.
As previously reported, city staff are projecting a budget shortfall of more than $36 million for FY 2025-2026. That estimate was in part informed by a projected decline in property tax collection totaling around $13.3 million. Ireland previously cited expanded homestead exemptions for seniors and an increase in successful property tax protests at the Dallas County Appraisal District as two of the reasons behind the anticipated decline.
Sales Tax Revenue Is Slowing
Ireland also dropped a memo on the city’s sales tax receipts. As projected earlier this summer, revenue from sales taxes showed a downward trajectory.
“Year-to-date collections are $3.0 million below our year-to-date budget. The FY 2024-25 budget for sales tax is $463.8 million, and the year-end forecast is $459.1 million due to actual collection trends and analysis provided by our contract economist,” the city CFO wrote to council members. “We will continue to monitor our sales tax forecast closely.”
Ireland previously warned the city council in June that “uncertainty in the market” was informing analysts’ projections. Other declines in city revenue sources were also logged that month, including dips in franchise fees, fines and forfeitures, and licenses and permits.
