AUSTIN, Texas — The city of Harker Heights continues to lose revenue from a law passed four years ago, which says only cities adjacent to military installations receive reimbursement from the state for tax exemptions 100 percent disabled veterans receive.
According to Harker Heights, it must forego about $1.6 million in ad valorem tax revenue this fiscal year, which is equal to eight percent of the city's total general fund revenues. Additionally, it's more than 18 percent of the city's total property tax revenue.
"It's an unattended consequence of the program," State Representative Brad Buckley (R-Salado), who authored House Bill 634 to help change the language of the reimbursement program, said. "The original legislation didn't contemplate that a community may not directly touch a military installation and have significant impact."
House Bill 634 would change the way the law is written to remove the adjacent requirement, making Harker Heights eligible to receive reimbursements under the terms of the law.
Harker Heights Mayor Spencer Smith said the financial shortfall impacts everyone in the city.
"The $1.6 million dollars we are losing are things that can be spent on infrastructure like roads, sewer, water and on public safety," Smith said. "It really impacts our Police, Fire and EMT."
According to the city, revenue losses have an average increase of 31 percent per year, while the financial losses pile up and possible budget cuts loom.
"Any time that you have such significant revenue loss, services are going to have to be cut," Buckley said. "Or the city will have to look at certain fees that I know they don't want to impose upon the citizens."
Fort Hood could be at risk of receiving a lower base rating, Heart of Texas Defense Alliance director Keith Sledd said.
"At some point those budget cuts, those could become severe enough that it impacts basic services and so, now you have a lower quality of life and should a future base realignment enclosure commission come up," Sledd said. "You could have a lower rating of the base because of the quality of life that surrounds it."
Smith said if the bill doesn't pass, budgeting will be difficult.
"The backup plan is, as we go into budgeting, you know if this continues we have to look at services and things that we have to do," he said. "In the out years, it's not a pretty picture."
Rep. Buckley said this is his top priority and made a promise to follow it through.
"We're going to get the bill passed, we feel like it's going to happen," he said. "I will continue to work with my colleagues so that they will see the importance of voting for this bill. I'll continue working with Senator Buckingham in the Senate so that we can make sure the Senate side knows the importance of the Bill. The Governor has recognized this issue. We feel like if we can get this through chambers, we can get the Governor to sign it."
Buckley also said that he had several members of the committee told him Monday afternoon they will support his bill.
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