The Conroe City Council adopted its $389.9 million budget last week, which includes a $4.3 million deficit, after allocating reserve funds for several capital improvement projects.

The council approved the budget in a 4-2 vote Sept. 10.

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The budget is a slight increase over the 2026 budget of $381 million. The budget also includes $11.3 million in contingency funds.

The city's tax rate of 42.72 cents per $100 of property valuation will remain the same.

"We really aren't short money; we are just allocating reserves for things we need," Councilman David Hairel said. "It's a very good thing; we are paying cash rather than going into debt."

In total, the city will use about $26 million in reserves to fund several water wells, a water plant and street rehabilitation.

According to the budget posted on the city's website, $1.1 million is allocated for its step pay program for police officers, $2.8 million in flat raises for sworn police personnel, and $1.7 million for a 3.5% raise for all other personnel, including firefighters. The budget also includes $628,000 for additional part-time and full-time staff.

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The budget also includes about $130,000 to fund the city's 2027 contract with Flock Safety Inc. for 53 automated license plate readers. The council approved the new contract a month after rejecting a proposal to ask voters in November whether the city should continue using the Flock system.

Hairel and Councilwoman Shana Arthur were the two to vote no on the budget because of the contract funding with Flock. The city has contracted with Flock since 2019 and is entering the second year of a five-year contract.

Hairel called the cameras "a surveillance system that raises unresolved constitutional questions" and asked the council to pause funding for the city's Flock program and for a review of how the technology is used.

However, fellow council members did not support pausing the contract.

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This article originally published at Conroe approves $389M budget with deficit to fund capital improvement projects with cash reserves.