Odessa opens FY2026 budget hearing and sets maximum tax rate at $0.4707
August 27, 2025 | Odessa, Ector County, Texas
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The Odessa City Council opened a public hearing on the proposed fiscal year 2026 budget and adopted a resolution establishing a maximum tax rate of $0.4707 per $100 of assessed valuation. City staff said the proposal would fund pay corrections and first-responder premium pay while adding one-time capital projects.
City staff member Kaylee, who presented the budget, told the council the proposal was built on four principles: using FY25 department operating budgets as a base, maintaining at least six months of reserves, prioritizing human-capital spending (including Gallagher pay corrections and ARPA premium pay for first responders), and aligning supplemental requests with council priorities. "The proposed budget shows a revenue increase of $40,200,000 when comparing to the original current year budget," Kaylee said. She also said the proposed operating expenditures total $309,300,000, a 6.7% increase over last year’s budget figures (or 2.5% when factoring vacancies) and that the budget includes approximately $37,600,000 in one‑time capital expenditures.
The council adopted a resolution establishing a maximum tax rate of 0.4707; council members followed the statutorily required language and scheduled the first vote on the proposed tax rate for Sept. 17 and a second, final vote for Sept. 23, 2025. Kaylee provided an example of taxpayer impact using Ector County average values: for a $193,000 home the city portion of property tax would increase by $8.54 annually (about $0.71 per month) under the proposed rate, and staff noted a web tool is available for residents to calculate their individual impact.
During public comment, resident Dallas Kennedy supported the action and called the change a "tax correction" rather than a hike, saying the increase helps sustain employee pay and services. "This is not a tax hike. This is a tax correction," Kennedy said. He urged the council to plan for recurring costs when using one-time federal funds and to focus on essential services.
No formal amendments to the budget were made at the meeting. The council adopted the maximum rate and opened the formal public hearing on the FY2026 budget; the two required votes on the tax rate will occur on the dates staff announced.
The council will return for the Sept. 17 and Sept. 23 votes to adopt a final tax rate and approve the FY2026 budget after required public notices and hearings are completed.
City staff member Kaylee, who presented the budget, told the council the proposal was built on four principles: using FY25 department operating budgets as a base, maintaining at least six months of reserves, prioritizing human-capital spending (including Gallagher pay corrections and ARPA premium pay for first responders), and aligning supplemental requests with council priorities. "The proposed budget shows a revenue increase of $40,200,000 when comparing to the original current year budget," Kaylee said. She also said the proposed operating expenditures total $309,300,000, a 6.7% increase over last year’s budget figures (or 2.5% when factoring vacancies) and that the budget includes approximately $37,600,000 in one‑time capital expenditures.
The council adopted a resolution establishing a maximum tax rate of 0.4707; council members followed the statutorily required language and scheduled the first vote on the proposed tax rate for Sept. 17 and a second, final vote for Sept. 23, 2025. Kaylee provided an example of taxpayer impact using Ector County average values: for a $193,000 home the city portion of property tax would increase by $8.54 annually (about $0.71 per month) under the proposed rate, and staff noted a web tool is available for residents to calculate their individual impact.
During public comment, resident Dallas Kennedy supported the action and called the change a "tax correction" rather than a hike, saying the increase helps sustain employee pay and services. "This is not a tax hike. This is a tax correction," Kennedy said. He urged the council to plan for recurring costs when using one-time federal funds and to focus on essential services.
No formal amendments to the budget were made at the meeting. The council adopted the maximum rate and opened the formal public hearing on the FY2026 budget; the two required votes on the tax rate will occur on the dates staff announced.
The council will return for the Sept. 17 and Sept. 23 votes to adopt a final tax rate and approve the FY2026 budget after required public notices and hearings are completed.
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