Fulshear homeowners will pay about $5.74 more per month in city property taxes under a new tax rate approved by City Council, as parks debt comes due and the city's once-rapid growth begins to slow.

COMING SOON: New bowling venue, Sam's Club and more businesses planned across Fort Bend County

Council voted 5-2 Sept. 1 to adopt a tax rate of $0.19 per $100 of taxable value as part of the city's fiscal year 2027 budget. The increase amounts to about 13.5% over last year for a home with the city's median taxable value of $527,823, according to Mariah Liendro, Fulshear's communications manager.

Fulshear's finances are shifting as development-related revenue declines while the city takes on debt-service costs from its $13.5 million voter-approved parks bond program.

The adopted rate came in below the $0.1931 rate initially proposed by the city after council members spent much of the meeting working through individual projects and debating which should be included in the budget.

The final package included $65,000 for Redbird Lane easement acquisition, $70,000 for shade structures at Eagle Landing Park, $100,000 for repairs to city hall and the police building, $200,000 for downtown land purchases, $40,000 for a backup generator at a lift station and $30,000 for backup lift pumps, according to city documents.

The higher tax rate comes as some of the revenue streams that benefited Fulshear during years of rapid development are beginning to decline.

Permit and license revenue is projected to fall from about $2.66 million to $2.11 million, a decline of nearly $549,000, or about 21%, city records show. Service revenue, including fees related to development, is projected to fall from about $1.19 million to $871,000, a decline of about $322,000, or 27%.

Transfers from the utility fund to the general fund are also expected to decline by roughly $589,000. During the meeting, Council Member Abhijeet Utturkar calculated the combined revenue reduction at about $1.46 million, equivalent to roughly 2.75 cents on the city's property tax rate. Staff agreed with his calculation.

Liendro confirmed the declines in permit, service and utility-transfer revenues are tied to Fulshear's slowing growth.

Staff stressed during the meeting, however, that the declining revenue wasn't the primary reason for the higher tax rate.

Other revenue changes and cost controls largely offset the losses, leaving the city's overall revenue gap little changed. The largest pressure on the tax rate came from debt service on voter-approved parks bonds.

Liendro confirmed the parks debt was the primary upward pressure on the rate. The city sold the bonds in 2025, increasing the interest and sinking portion of its property tax rate used to pay debt.

Council Member Kimberly Bow emphasized that the city is obligated to make the bond payments.

"It's not discretionary," Bow said. "The council can't say, 'We don't want to pay those.'"

Never miss a Katy and Fort Bend story with our bi-weekly newsletter

During public comments, resident Bill Clifford told council that Fulshear had benefited for years from increases in its property tax base, allowing the city to lower its tax rate. That trend, he said, could not continue indefinitely as growth slows and expenses rise.

"I think we're doing the right thing, raising the taxes," Clifford said. "Expenses are going to go up, there's inflation."

Despite the increase, City Manager Zach Goodlander said Fulshear residents still pay comparatively little in city property taxes.

"Fulshear is still the lowest municipal tax rate in Fort Bend County, and for residents within the City of Fulshear the City's portion of their tax bill is still less than half of what they pay to Fort Bend County, and less than they pay to their MUD, and school district," Goodlander said.

There's more to Houston with the Chronicle. Subscribe today for just 25¢.

This article originally published at Fulshear built for rapid growth. Now its budget is adjusting to a slowdown.