Conroe is considering its first-ever bond referendum for the May election ballot, but historically low voter turnout could be an issue for the bond’s success.
The city’s bond discussion comes after City Council approved more than $5 million for operations that was not budgeted ahead of the May 25 opening of the $107 million Hyatt Regency hotel and convention center
“We are obviously in a tough budget cycle this year,” Councilman Howard Wood said.
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Conroe officials are considering a $314.7 million budget for the upcoming fiscal year they hope will create a more sustainable spending pattern.
“This year we have a unique budgetary situation,” City Administrator Gary Scott said. “Let me be clear the city is not broke but we need to tighten our belts to ensure our future sustainability.”
The proposed budget, Scott said, does not include any cost of living or market raises for employees and does not include any new staff.
The proposed budget is a 2.8 percent increase over the current year’s budget of $306.2 million. The current tax rate of 42.72 cents per $100 property valuation is proposed to stay the same.
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Council has until Feb. 16 to call a bond election. Election Day is May 4.
Conroe’s population in 2020 was 94,400, according to the U.S. Census Bureau. Of those residents, 49,155 were registered to vote. In Conroe’s last election in May 2022, only about 3,000 people voted, according to information from Montgomery County Election Central.
The city’s financial advisor John Robuck with BOK Financial spoke to the council during a July meeting and said getting residents registered to vote is critical for the election.
“The most important thing is getting people out there to vote,” Robuck said. “Voter apathy is the biggest reason bond elections fail.”
Robuck said 90.2 percent of city bond elections in Texas have been approved by voters, since 2006. May is the month most city bond elections are successful, he said.
“The May election cycle has a 94 percent passage rate and November has 81 percent,” Robuck said. “So, May (bond referendums) have had better luck with voters.”
Robuck said if the bond election fails, the city is prohibited from issuing certificates of obligation, which do not need voter approval, for those projects for three years.
However, if a bond fails in May, the city can place the bond on the November ballot.
During a July 20 budget workshop, several council members said November would not be the right time for a bond election.
“I don’t want to compete with a $2 billion bond election with Conroe ISD,” said Councilman Harry Hardman.
CISD trustees will discuss a possible $1.9 billion bond package later this month to put to voters in November.
Collin Boothe, assistant city administrator and director of finance, said if the voters approve a bond election for capital improvement projects, it does authorize the city to increase the tax rate.
The last time the city has a tax rate increase, Boothe said, was in 2019 to 43.75 cents per $100 property valuation. The city decreased the tax rate for the current year to 42.72 cents.
While the council has not indicated support for or against a bond, they did discuss several projects that could be funded with the proceeds, including three new fire stations, a police driving training track, a senior center and a performing arts center.
Boothe said the city has $575.2 million in capital project needs, the budget proposes to only fund about $214.7 million, according to information provided by the city.
“A lot was left on the table,” Boothe said.
The city will approve its fiscal year 2023-24 budget and tax rate Sept. 14.
