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All Port Arthur employees would receive a 2.5 percent salary increase under a proposed fiscal year 2020-21 budget.

The budget, if approved, would authorize three new positions, two of which would be grant-funded. Among the new positions are a collection manager for delinquent city accounts in the finance department and grant-funded housing inspector and secretary in development services.

The city council on Tuesday voted to receive the proposed budget and set a public hearing on the matter for Sept. 1, the date of the next regular council meeting. Adoption of the budget ordinance is expected by Sept. 15, which is 15 days before the present budget expires.

A 4.3 percent increase in costs for health insurance and 3 percent for general property insurance are projected for 2020-21. It would also authorize $2.6 million in equipment purchases and $200,000 in new technology purposes.

During her presentation, Port Arthur interim finance director Kandy Daniel estimates a $5 million positive movement from the amended budget to the year-end result. That was attributed to higher-than-budgeted revenues in the general fund and management’s efforts to contain costs.

Revenues of $76,560,164 are projected for 2020-21, exceeding the 2019-20 estimate by more than $1 million but taking into account $15,370,135 in transfers, which would lead to a shortfall of $6,728,962 from the beginning balance of $31,260,820. The transfers, Daniel said, are expected to keep capital projects going, and they come at a time when Port Arthur and other cities continue to weather the impacts of the coronavirus crisis.

Among the FY 2020-21 budget bullet points Daniel highlighted:

• Budgets are balanced in all major operating funds with the exception of transfers to capital improvements
• some adjustments to current rate structure for water and solid waste, and
• overall, operating departments are budgeted at a “status quo” with limited additions.

The 2019-20 year-end estimates reflect a decrease in balances of $950,000, mainly due to lower-than-expected revenues in water and solid waste. The council had paused automatic shutoffs of delinquent water accounts to assist those who may have been affected by coronavirus through July 8.

The proposed budget would allocate funding for capital improvements primarily from operations including $11.1 million to the general fund and $2.2 million to water utilities, and calls for new bond issues including $10 million for the street reconstruction program and $18 million for the water line replacement plan.

The proposed total tax rate for fiscal year 2020-21 is $0.792 per $100 valuation, which is unchanged from last year, but is predicted to raise property tax funds by $635,743. That includes a maintenance and operations rate of $0.507979 and a debt rate of $0.284021.

Of the possible increase in property tax revenue, $284,589 is expected to be raised from new property added to the tax roll this year.

City officials are asking for a no-new revenue tax rate, which is needed to generate the same amount of taxes as last year, of $0.781411; and voter approval tax rate, or the highest a taxing unit can adopt without an election, of $0.814427.

A hearing for the proposed tax rate is scheduled for Sept. 8.