Budget season is upon us, and just like local school districts and Lubbock County, the Lubbock City Council must decide what the city’s 2026 budget will look like.
Controlling the budget for several city departments and staff — including Lubbock Fire Rescue and police — the council and mayor must work out what objectives, initiatives, and projects will be funded next year and which will be axed.
Check back daily to this story to see quick takeaways and talking points, and budget talks for the City of Lubbock start to heat up in Citizens Tower.
Day 4: A ‘clear as mud’ clarification given to the accuracy of LCAD numbers
After city leaders canceled Wednesday’s meeting, City Manager Jarrett Atkinson provided the council with an explanation of Tuesday’s LCAD tax rates and a bleak outlook for Lubbock’s sales taxes revenue.
As Councilman David Glasheen best summed up Atkinson’s assessment, the reason for the $2 million decrease in revenue this year from last year is due to “a change in state law, where the baseline that we use to calculate the new no-new-revenue rate is retroactively lowered.”
In short, under state law, adjustments are made to a city’s taxable values due to various tax freezes and exemptions, which are then applied to the new year. However, due to recent changes from the Texas Legislature, those adjustments now also act retroactively by one year.
“The net result of that is that mathematically what you did last year is no longer based on $23.232 billion (of net taxable value); rather, it is based on $23.0 billion — it’s a $205 million reduction in values that applies both now backwards and forwards,” Atkinson said.
This reduction directly impacts FY26’s No New Revenue (NNR) Tax Rate, meaning that LCAD went back and recalculated what the city’s levy should have been and its maintenance and operation (M&O) rate.
“When they did that, this spreadsheet will now tell you that your Fiscal Year 2025 M&O levy was $81.1 million, not the $83 million that (the council) voted on, ordered and received,” Atkinson said. “So that is a reduction of just right at $1.9 million that’s on paper.”
However, Atkinson said that while the paper is showing a reduction, the city did actually receive the $83 million — a point of contention he has with the new numbers.
So with the new LCAD recalculations, if the council were to adopt the FY 2026 NRR at $0.461938 with the understanding that the new M&O NNR is equal to $0.345378 times the new value, it would produce $81 million, a $1.9 million total reduction in revenue.
Here’s the kicker — the city staff has already crafted and presented a budget based on the assumption that the city’s NNR would have generated $83 million. As Atkison noted, he has never seen a disparity between the number the city assumes and what it receives from LCAD, and Lubbock isn’t the only city affected by this change in state law.
Now, the city has two options, as it is still working on a deadline — either cut an already bare-bones budget even more, or figure out how to get the now $81 million in revenue to the $83 million they expected.
And to only add salt to the wound, Lubbock’s sales taxes aren’t doing too hot — and it’s also a big revenue generator for the city’s general fund.
“June is usually one of your bigger sales tax months, and it was not,” Atkison said.
If the sales tax trends stay on par with what the city is expecting, the city is looking at collecting $100.2 million in sales tax revenue this fiscal year — $5.4 million behind what the council budgeted during the last budget cycle.
“I’ve still got those remaining three (months) to finish out this fiscal year,” Atkinson said. “We will stay where we are with the changes that we have put into place — the freezes and so forth.”
But overall, Atkison said he is still OK with the $100.3 million of sales tax revenue budgeted in the FY26 budget.
Day 3: City of Lubbock Budget talks canceled
After Tuesday’s major setback from LCAD’s calculations on the city’s No‐New‐Revenue Tax Rate and the Voter Approval Tax Rate, Wednesday’s meeting has been canceled.
It is yet to be seen if day four of the city’s budget session occurs or if the city council will pick up its budget talks on Aug. 12.
Day 2: City budget torpeadoed by LCAD numbers, stalls talks on Wednesday
On Tuesday, after hours of discussion about various enterprise funds in the city budget, City Manager Jarrett Atkinson announced a major setback in the budget talks, which caused the council to cancel Wednesday’s meeting.
Vital pieces of the budget come from the Lubbock Central Appraisal District — an independent tax entity set up by state law — which sends the city its preliminary and certified tax values.
Atkinson also said LCAD sends the city its calculations that form the No‐New‐Revenue Tax Rate and the Voter Approval Tax Rate. However, when the city received the calculations worksheet from LCAD on Monday evening, Atkinson said city staff took issue with it.
The issue is that the calculations are based on last year’s levy, not the new year’s levy, with Atkinson saying that maintenance and operations drop from $83 million to $81 million.
“What it means, if this ends up being right, in essence, the first $2 million of new revenue is just getting you to zero so that is a fundamental change to where we were,” Atkinson said. “The short version, if you adopt a no new revenue tax rate this year, you’ll have $2 million less than you did the year before, you get the $1.5 million off the new (revenue), so you’re $500,000 in the hole.”
For context, this means that the $1.5 million in new revenue from growth is not enough to offset the $2 million loss from the miscalculated base levy, meaning the city would $500,000 in the red.
Putting all of the projected miscalculations from LCAD into terms for the city budget and context, here’s what we get:
This disputed miscalculation comes at a time when the city is working against an action item scheduled on Aug. 12 — propose a maximum tax rate for FY 26.
“This is, I don’t know how to describe it,” Atkinson said. “I’ve never seen anything like this. Your calculated numbers versus your worksheet numbers are usually within tenths of a percent on the total, and they are not.”
While there were murmurs from the city council that they were ready to debate and give guidance to the city manager on how to move forward with the budget on Wednesday, the council decided to cancel Wednesday’s scheduled meeting to allow city staff to work on the issue.
Thursday’s meeting is still up in the air as city staff works with LCAD to verify its tax rate calculations, but is still scheduled to take place as of 5 p.m. Thursday.
Day 1: Setting the stage for the rest of the week.
Monday was all about presenting the staff-created budgets and the overall big picture budget. Here are the quick takeaways and a breakdown of each departmental budget.
City Manager Jarrett Atkinson told the council that the significant economic drivers for FY26 will be the recent drop in sales tax revenue — which he hopes to see increase in the future — and value of new property.
Taking everything into account, Atkinson used the example of an average $222,300 single-family residential house that saw a 1% increase in taxable values and, impacted by the tax rate, would see a $31.45 increase next year.
What are each of the City of Lubbock’s departments’ budgets for FY26?
Here’s what each city department is asking for and whether that is an increase or decrease from FY 2025’s budget.
When will the Lubbock City Council meet to talk about the budget?
The council is set to convene the following days at 2 p.m. in Citizens Tower — 1314 Ave. K:
For those who can not attend in person, the proceedings will be streamed at https://ci.lubbock.tx.us/pages/video-on-demand.
How can I watch, participate during Lubbock’s budget workshops?
The workshops are open to the public; however, public participation is not allowed at this time as this is an opportunity for the city council to hear from heads of departments on their budget requests.
The finalized budget will be brought forward at a later date, with opportunities for public comment.
Mateo Rosiles is the Government & Public Policy reporter for the Lubbock Avalanche-Journal. Got a news tip for him? Email him: mrosiles@lubbockonline.com.
This article originally appeared on Lubbock Avalanche-Journal: What’s the 2026 City of Lubbock budget? Here’s what to know as council talks are underway
Reporting by Mateo Rosiles, Lubbock Avalanche-Journal / Lubbock Avalanche-Journal
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