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PROPOSED BUDGET FY 2026-2027

(936) 825-6475 200 E. McAlpine Street Navasota, TX 77868

City of Navasota Fiscal Year 2026-2027 Budget Cover Page This budget will raise more revenue from property taxes than last year's budget by an amount of $262,989, which is a 6.16 percent increase from last year's budget. The property tax revenue to be raised from new property added to the tax roll this year is $130,267. The members of the governing body voted on the budget as follows: FOR: AGAINST: PRESENT and not voting: ABSENT:

Property Tax Rate Comparison Property Tax Rate: No-New-Revenue Tax Rate: No-New-Revenue Maintenance & Operations Tax Rate: Voter-Approval Tax Rate: Debt Rate:

2026-2027 $0.5078/100 $0.4832/100 $0.4413/100 $0.5343/100 $0.0734/100

2025-2026 $0.5078/100 $0.4832/100 $0.4382/100 $0.5155/100 $0.0528/100

Total debt obligation for City of Navasota secured by property taxes: $5,208,906

TABLE OF CONTENTS 1

INTRODUCTORY & ORGANIZATIONAL

GENERAL FUND

ENTERPRISE & SPECIAL REVENUE FUNDS

CIP FUNDS, DEBT SERVICE FUND, & RATES

Transmittal Letter Budget Highlights City Council & City Official Organizational Chart Core Values 2025 Focus Areas Consolidated Fund Summary

General Fund – Summary General Fund - Statement of Revenues General Fund - Summary of Department and Divisions

Utility Fund – Revenues & Expenditures Gas Fund – Revenues & Expenditures Wastewater Fund – Revenues & Expenditures TIRZ No. 1 Fund – Revenues & Expenditures Fire Service Board Fund – Revenues & Expenditures Cemetery Fund – Revenues & Expenditures Voluntary Donations Fund – Revenues & Expenditures Economic Development Fund – Revenues & Expenditures Hotel Fund – Revenues & Expenditures

Capital Improvements Fund – Revenues & Expenditures Utility CIP Fund – Revenues & Expenditures Debt Service Fund – Revenues & Expenditures Debt Schedules Compensation Plan FY2027

4 5 8 9 10 11 12

13 14 17

42 47 50 54 56 58 61 63 66

70 72 74 76 83

GLOSSARY OF TERMS Glossary of Terms

86 3

LETTER FROM CITY MANAGER To: Mayor and City Council From: Robert Hemminger, City Manager Date: August 24, 2026 Subject: Fiscal Year 2026-27 Proposed Budget and Tax Rate It is with great appreciation for the work of City staff and the guidance of the City Council that I present the proposed Fiscal Year 2026-2027 budget and tax rate. Last year's budget focused on stabilization, transparency, and a back-to-basics approach to living within our means. The proposed Fiscal Year 2026-2027 budget builds on that foundation by reallocating existing resources, balancing the General Fund and each of the City's utility enterprise funds, completing important employee compensation work, strengthening key one-person operations, and advancing targeted capital improvements and quality of life investments while maintaining the same property tax rate. The proposed tax rate remains unchanged at $0.5078 per $100 of valuation. This rate is above the no-new-revenue tax rate of $0.4832 and below the voter-approval tax rate of $0.5343, as calculated in the City's 2026 Tax Rate Calculation Worksheet. While the nominal rate remains the same, the proposed budget continues the City's effort to allocate revenues more transparently between maintenance and operations and debt service. The proposed budget will also be accompanied by a proposed amendment to the current fiscal year budget. That amendment would authorize a one-time transfer of up to $650,000 to the Vehicle Replacement Fund as the City continues its transition from a leased fleet to purchased and owned vehicles. The amendment would also transfer $500,000 in current-year funding designated for annual street repairs to the CIP Fund for the City Hall Amphitheater Project and appropriate $500,000 in unspent 2025 Certificates of Obligation proceeds for the Field, Trail, and Park Lighting Project. Both projects were highly ranked through the adopted CIP process and reflect a direct investment in parks, public gathering spaces, and quality of life. I am proud that this proposed budget demonstrates fiscal responsibility, transparency, and diligence in living within our means. The budget presents a balanced General Fund and balanced budgets for all three utility enterprise funds, which represents meaningful progress toward a more sustainable financial structure. Even after the proposed onetime transfers and current-year CIP allocations described above, current year-end estimates indicate the General Fund will still end the year with unspent funds that can be added to fund balance, helping restore funds used in recent years.

LETTER FROM CITY MANAGER The proposed budget also recognizes the need for continued improvement in the administration of special revenue funds, including Hotel Occupancy Tax funds. Following discussion during the budget workshop, staff will develop a proposed process for administering HOT funds directly through the City rather than through an outside administrative arrangement. This proposal will be brought back to the City Council for consideration before the end of the calendar year and will be intended to strengthen transparency, accountability, and alignment with Council priorities for tourism-related expenditures. Some of the other noteworthy points regarding this proposed budget are described below. Fiscal Responsibility and Fund Balance - The proposed budget reflects continued discipline in matching revenues and expenditures, improving transparency, and rebuilding financial flexibility. The General Fund and each of the three utility enterprise funds are balanced. Current year-end projections also reflect an increase of more than $200,000 to General Fund fund balance after the proposed one-time transfers and current-year CIP allocations. Personnel Structure and Organizational Capacity - The proposed budget reallocates existing personnel resources to the areas of greatest operational need. The Assistant City Manager position is removed, and those funds are redirected toward more urgent organizational priorities. The Assistant Public Works Director position has been converted to a City Engineer / Director of Public Works and Engineering position to strengthen in-house technical capacity, capital project delivery, and long-term infrastructure planning. Two new positions are proposed within the City family: a Deputy Court Clerk and an IT Specialist. Both Municipal Court and Information Technology have functioned as one-person operations while workloads, compliance demands, service expectations, and organizational reliance have continued to increase. These positions are intended to provide more manageable workloads, build redundancy and continuity, and reduce operational risk in areas that are critical to daily City operations. Employee Compensation and Benefits - The proposed budget completes the planned compensation implementation with a 5% across-the-board adjustment for employees. This adjustment includes a 2% CPI-based cost-of-living component, with the remaining portion continuing the City's effort to implement the salary survey and maintain a more consistent, competitive, and internally equitable pay structure. Employee health insurance continues to be a significant budget consideration. Working closely with the City's insurance agent and broker, staff was able to reduce the impact of an initial renewal quote of approximately 30% to a

LETTER FROM CITY MANAGER proposed 10.5% premium increase, with only minor coverage changes and no increase in most ancillary coverage products. Fleet Replacement Strategy - As the City continues transitioning from leased vehicles to purchased and owned fleet units, the proposed current-year budget amendment would transfer up to $650,000 to the Vehicle Replacement Fund. This one-time transfer allows the City to cash-fund needed vehicle acquisitions without placing both remaining lease obligations and new vehicle purchase costs entirely within the next fiscal year's General Fund budget. Capital Improvements and Debt Projects - The proposed budget moves forward with an anticipated 2026 Certificates of Obligation project totaling approximately $8 million, with approximately $6 million dedicated to General Fund street improvements and approximately $2 million dedicated to utility-related improvements. This project represents a significant reinvestment in the City's roadway system and related infrastructure needs and will fund a highly visible street maintenance project that will benefit residents throughout the community. The proposed current-year budget amendment would also advance two highly ranked quality of life projects from the adopted CIP. The amendment would allocate $500,000 to the City Hall Amphitheater Project identified in the Parks Master Plan and $500,000 in unspent 2025 Certificates of Obligation proceeds to the Field, Trail, and Park Lighting Project, the highest-ranked project on the adopted CIP list. These projects will enhance civic gathering spaces, parks, trails, and athletic facilities, while improving the experience for concerts, festivals, recreation programs, and everyday public use. The proposed budget also puts resident-designated voluntary utility bill donations to work for their intended purposes, including approximately $45,000 for the Fire Department to replace air packs. Park-designated donations will continue to be used consistently with resident intent and coordinated with the larger CIP improvements. Utility Rates and Enterprise Funds - Staff is continuing to finalize the utility rate study. The proposed rate structure is expected to be simpler, easier for residents to understand, and easier for staff to administer. Based on current expectations, most residential utility bills are anticipated to remain the same or decrease slightly, although final recommendations will be presented once the rate study is complete. This proposed budget also presents balanced budgets for the City's utility enterprise funds. This is an important step toward ensuring that each enterprise fund supports the services, operations, debt obligations, and infrastructure needs assigned to it.

LETTER FROM CITY MANAGER Continued Efficiency and Service Delivery - Staff continues to evaluate operations and implement ways to improve the efficiency with which the City serves the community. The proposed budget reflects a continued commitment to providing essential services, planning responsibly for future needs, and making careful use of the resources entrusted to the City. The proposed budget also supports continued efforts to modernize the tools our employees use to serve the community. The FundView ERP migration is an organization-wide improvement that will touch nearly every department and strengthen financial administration, reporting, internal coordination, and daily service delivery. It will also improve integration with Municipal Court and provide an online payment option that has not previously been available through the City’s existing platform. The MGO migration will continue improving permitting, development review, inspections, and related customer service functions within Development Services. Together, these improvements reflect the City’s ongoing effort to use technology wisely, improve efficiency, and better support both our employees and the residents we serve. This budget is a product of careful review, responsible reallocation, and the dedication of staff across the organization. It is also a meaningful example of priorities adopted by the Council being translated into action. The ability to balance the budget, strengthen the organization, and advance highly ranked quality of life and infrastructure projects is a testament to the dedicated service of the City Council, Directors, Finance staff, and employees who continue to help Navasota improve, mature, and prepare for the future. Preparing a municipal budget is ultimately an act of stewardship. The resources entrusted to the City belong to the people we serve, and it is our responsibility to manage them with care, honesty, discipline, and humility. I consider it a high honor to work alongside the City Council and the City’s exemplary staff, and I continue to pray for wisdom and discernment as we make decisions that strengthen our organization, serve our community, and help Navasota continue to THRIVE. I look forward to implementing this budget and continuing the City's progress together. Respectfully submitted,

CITY OF NAVASOTA, TEXAS

ORGANIZATIONAL CHART FY 2026-2027

RESIDENTS

MAYOR & CITY COUNCIL

BOARDS & COMMISSIONS

MAINTENANCE SERVICES Jay Chappell FACILITY MAINTENANCE

DEVELOPMENT SERVICES Lupe Diosdado BUILDING

(PERMITS & INSPECTIONS)

CITY MANAGER Robert Hemminger

MUNICIPAL JUDGE Pat Gruner

CITY ATTORNEY Cary Bovey

MARKETING & COMMUNICATIONS Taylor Hughes

ADMINISTRATIVE SERVICES Michael LaBelle

PUBLIC WORKS & ENGINEERING Scott Taylor

PARKS & RECREATION

MAIN STREET

FINANCE

STREETS

UTILITY OPERATIONS

EMERGENCY MANAGEMENT

DISPATCH

MUNICIPAL COURT

PUBLIC LIBRARY

TOURISM

ACCOUNTING

DRAINAGE

AIRPORT OPERATIONS

OPERATIONS

PATROL

OAKLAND CEMETERY

UTILITY BILLING

FIRE PREVENTION

PROPERTY & EVIDENCE

COMMUNITY SERVICES Tiffany Byers

UTILITIES Jennifer Reyna

FIRE DEPARTMENT Jason Katkoski

POLICE DEPARTMENT Mike Mize

PARK MAINTENANCE

ECONOMIC DEVELOPMENT

FLEET MAINTENANCE

CODE ENFORCEMENT

COMMUNITY OUTREACH

PAYROLL

SANITATION

INFORMATION TECHNOLOGY

SPECIAL EVENTS

GRANTS

CIP/PROJECT MANAGEMENT

RECORDS

HUMAN RESOURCES

SPECIAL PROJECTS

CID

CITY SECRETARY Susie Homeyer

ANIMAL SERVICES

Core Values

Teamwork & Collaboration

Honor & Integrity

Resilience & Adaptability

Inclusivity & Diversity

Vision & Progress

Empowerment & Engagement

We believe in the power of collective effort and cooperation. Foster a culture of collaboration among residents, businesses and government. Together we can achieve greater outcomes and overcome challenges.

Uphold honesty, transparency, and ethical conduct in all endeavors. Demonstrate integrity in decision-making and actions for the greater good. Earn and maintain the trust of our community through principled leadership.

Embrace change and remain agile in a constantly evolving world. Build resilience to face adversity and bounce back stronger. Learn from experiences to continuously improve and innovate.

Celebrate and embrace the richness of our diverse community. Promote inclusivity, ensuring that all voices are heard and valued. Create an environment where everyone feels welcome and respected.

Pursue a forward-thinking vision for the city’s growth and development. Encourage innovation and progressive ideas that benefit our residents. Strive to be a model city that sets new standards and inspires others.

Empower individuals to participate in shaping the city’s future. Encourage active citizenship and engagement in local decision-making. Support initiatives that enhance community involvement and civic pride.

Strategic Plan Focus Areas Our Mission is “To guide Navasota’s growth in a way that maintains our heritage, culture, and uniqueness, while maximizing our economic and social development.” Our Vision is: “Navasota 2027: What America wants to be — A beautiful, progressive, vibrant, service-oriented, close-knit community filled with historical charm and promise for people and business.”

Marketing & Communications The City of Navasota will proactively work to provide accurate, timely communications to the citizens.

Infrastructure The City of Navasota will provide excellent infrastructure and facilities that meets the needs of the citizens and businesses, and staff.

Buildings/Facilities The City of Navasota will provide adequate facilities and buildings for its city employees and citizens to ensure safe and adequate space for all.

Community & Economic Development The City of Navasota will promote a strong and diverse economy that strengthens the local sales tax and property tax base while also contributing to a high quality of life.

Organizational Excellence The City of Navasota will operate in a transparent, efficient, accountable and responsive manner by preparing the organization and the staff for the future, focusing on core services, attracting and retaining the best employees and wise stewardship of financial resources.

CONSOLIDATED SUMMARY OF ALL FUNDS

GENERAL FUND SUMMARY

GENERAL FUND STATEMENT OF REVENUES

FIRE SERVICES Summary: The Fire Department provides professional fire protection, suppression, and emergency management services to the City of Navasota. Combining skilled personnel with essential equipment, the department delivers fire prevention, public education, and prompt emergency response. It also coordinates preparedness and recovery efforts to enhance community safety and resilience.

Scope of Services: The Fire Department, under the direction of the Fire Chief, is responsible for the protection of life and property from fires, hazardous material incidents, and other emergencies that may arise.

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1716

POLICE Summary: The Police Department is dedicated to protecting life, property, and maintaining public order within the City of Navasota. The department is responsible for patrol, dispatch, records, criminal investigations, and the Animal Control Division, which is responsible for enforcing animal-related laws and promoting public safety.

Scope of Services: The Police Department is responsible for providing the community with public safety services. The Division's functions include: apprehending criminal offenders, protecting life and property, controlling automobile traffic and crowds, assisting in the event of a disaster, and enforcing the City's animal control regulations.

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ANIMAL SERVICES

Summary: The Animal Services Division promotes a safe and healthy community by addressing animal-related concerns and supporting responsible pet ownership. Through enforcement, education, outreach, and compassionate care, the Division works to protect residents while promoting the humane treatment and welfare of animals.

Scope of Services: The Animal Services Division is responsible for enforcing local and state animal-related laws and ordinances, responding to service calls and complaints, and promoting public health and safety. Animal Control Officers provide education on responsible pet ownership and coordinates with local shelters and veterinary services to support the humane treatment and care of animals.

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ADMINISTRATION Summary: The Administration Department provides essential leadership, support, and coordination for the City of Navasota’s municipal operations. It is responsible for overseeing a broad range of services that promote efficient governance, strategic planning, and community engagement.

The

department

includes

multiple

specialized

divisions

that

work

collaboratively to support the City’s mission, enhance public services, and foster economic growth.

Scope of Services: The Administration Department, under the direction of the City Manager as the Chief Executive Officer of the City, plans, organizes and directs the activities of all departments of the municipality. In carrying out these duties, he interprets and implements City Council policies; handles citizen inquiries, complaints and requests; coordinates departmental efforts; prepares management reports; recommends policy changes that appear necessary and desirable; represents the City in its relations with the public, the press and other governmental entities; and executes the policies and desires of the City Council through administrative directives.

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HUMAN RESOURCES Summary: Human Resources supports the City of Navasota by fostering an effective, professional, and engaged workforce. The Division promotes consistent personnel practices, supports employees and departments, and helps ensure City policies are administered fairly and effectively.

Scope of Services: Human Resources is responsible for administering the City’s personnel policies and practices in a consistent and equitable manner. The Division supports City departments and employees by promoting cooperation, efficiency, and a positive work environment throughout the organization.

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CITY COUNCIL

Summary: The City Council serves as the elected governing body of the City of Navasota, providing leadership and establishing policies that guide the City’s operations and future direction. Through strategic decision-making, fiscal oversight, and community representation, the Council works to advance the priorities of the community and promote the long-term well-being of Navasota.

Scope of Services: The City Council supports the legislative and policy-making functions of the City’s elected governing body. This division provides the resources necessary for Councilmembers to fulfill their roles as representatives of the community and stewards of the City’s strategic direction.

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MUNICIPAL COURT Summary: The Municipal Court provides fair, efficient, and professional administration of the City’s judicial responsibilities. The Division processes cases and maintains accurate court records while supporting the enforcement of state laws and City ordinances. Through timely case administration, required reporting, and service to the public, Municipal Court helps ensure accountability and access to the local judicial process.

Scope of Services: The Municipal Court is responsible for processing and keeping accurate records of citations, including all traffic violations and other Class C Misdemeanor or criminal charges filed by the Navasota Police Department, City of Navasota, and any complaints filed by individual citizens. Services include preparation of complaints, administration of oaths to persons filing complaints, and preparation of necessary summons, arrest warrants, and subpoenas. Municipal Court reports all moving traffic convictions to the Texas Department of Public Safety and compiles statistical reports for the Comptroller of Public Accounts, Office of Court Administration, and for all governmental units as required by law.

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INFORMATION TECHNOLOGY

Summary: Information Technology provides and maintains the technology infrastructure necessary to support efficient and reliable City operations. The Division manages computer systems, networks, hardware, software, and technical support while assisting departments with technology needs and solutions. Through ongoing maintenance, coordination, and support, Information Technology helps ensure City staff have secure and dependable technology resources to effectively serve the community.

Scope of Services: Information Technology utilizes a combination of personal computers, file servers, and other critical components to maintain data files for City operations. These are interconnected through secure networks. The Division maintains all data processing equipment for the City. They also provide continuing software support for Microsoft products and Windows operating systems. They assist departments in the selection, installation, implementation, and maintenance of computer hardware and software. This division also coordinates all authorized software applications being used in the City.

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DEVELOPMENT SERVICES Summary: Development Services supports the orderly growth, development, and maintenance of the City of Navasota through planning, zoning, building permitting, code enforcement, and development coordination. The Division works with residents, property owners, developers, contractors, businesses, and appointed boards to guide development and property maintenance in accordance with the City’s adopted plans, codes, and regulations. Through long-range planning, development review, permitting and inspections, and proactive code enforcement efforts, the Division helps promote responsible growth, safe and compliant development, property upkeep, and a well-planned community.

Scope of Services: Development Services manages development-related programs and activities, including comprehensive planning, zoning, private-sector development guidance, building permits and inspections, and code enforcement. Staff reviews proposed development and construction for compliance with applicable City regulations, coordinates the permitting and inspection process, and works with property owners and businesses to address code compliance and property maintenance concerns. Additionally, Planning staff serves as advisors to the Planning and Zoning Commission and the Zoning Board of Adjustment.

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ECONOMIC DEVELOPMENT Summary: The Economic Development Division promotes economic growth and investment in the City of Navasota by supporting business development, retention, and expansion. The Division works with local and regional partners to strengthen the business community, attract new opportunities, support workforce development, and enhance quality of life. Through coordination, marketing, and direct assistance to businesses, the Division helps foster a strong and sustainable local economy.

Scope of Services: The Economic Development Division works with the Navasota Economic Development Corporation Board to establish direction and Policies related to economic development projects in the City. The division continues to work with our regional economic development partners on business retention and expansion programs, small business development, marketing efforts, workforce initiatives, transportation issues and quality of life issues.

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MARKETING & COMMUNICATIONS

Summary: The Marketing & Communications Department connects the City of Navasota with residents, businesses, and visitors through timely, accurate, and engaging communication. The Department manages the City’s brand, public information, digital presence, and community outreach while promoting transparency and awareness of City programs and services.

Scope of Services: Marketing & Communications is responsible for developing and executing clear, consistent, and strategic communications that inform, engage, and connect residents, businesses, and visitors. Under the leadership of the Marketing & Communications Director, the Division manages the municipality’s brand, messaging, public relations, and digital presence, ensuring transparency and promoting civic pride.

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TOURISM

Summary: Tourism promotes Navasota as a welcoming destination while supporting economic vitality, cultural heritage, and a thriving community. Through destination marketing, events, partnerships, and visitor engagement, the Division works to attract visitors and enhance their experience in Navasota. The Division also supports the continued revitalization and promotion of historic downtown as a destination for commerce, culture, and tourism.

Scope of Services: Tourism supports local economic vitality and cultural preservation by promoting tourism, enhancing the visitor experience, and managing destination development. Through strategic marketing, community partnerships, and event coordination, the Division attracts visitors while supporting the quality of life for residents.

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FINANCIAL SERVICES

Summary: The Finance Department manages the City of Navasota’s comprehensive financial operations, ensuring accuracy, compliance, and transparency in all fiscal activities. The department’s core responsibilities include accounting and financial reporting, budget development and monitoring, payroll administration, purchasing and procurement, and audit coordination. Through these functions, the department supports sound financial management and effective delivery of City services.

Scope of Services: Financial Services is responsible for the financial integrity, accountability, and day-to-day fiscal operations of the City of Navasota. This division manages a broad range of internal and external financial functions, including payroll, accounting, purchasing, and financial reporting.

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UTILITY BILLING Summary: Utility Billing manages utility accounts, billing, and payment services for residents and businesses throughout the City of Navasota. The division provides accurate and timely customer service while supporting utility operations for the City’s water, wastewater, and natural gas systems.

Scope of Services: Utility Billing oversees utility account management, billing, payment processing, payment collection, and customer assistance related to City utility services. The division supports accurate account records, timely billing, customer communication, and coordination with utility operations staff.

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PUBLIC WORKS ADMINISTRATION Summary: The Public Works Administration Department provides administrative oversight, budget support, coordination, and project management for personnel and operations within the Public Works and Utilities areas. The division supports planning, procurement, compliance, capital project coordination, work order management, interdepartmental communication, and implementation of projects related to streets, drainage, sanitation, water, wastewater, natural gas, airport operations, and other public infrastructure needs. Scope of Services: Public Works Administration is responsible for planning, organizing, coordinating, and supporting projects and services involving streets, drainage, sanitation, water, wastewater, natural gas, airport operations, capital improvements, and special projects. The division also supports infrastructure development through project coordination, inspections, regulatory compliance, facility and utility planning, and administrative support for groundwater-based water production and distribution operations. Expenditures by Category:

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SANITATION

Summary: The Sanitation Division provides reliable and environmentally responsible solid waste services for Navasota residents and businesses. Services include refuse collection, recycling, and bulk and brush pickup through contracted services and City coordination.

Scope of Services: The Sanitation Division is responsible for coordinating timely, efficient, and environmentally responsible solid waste services for residents and businesses. The division oversees refuse collection, recycling programs, bulk and brush pickup, customer service coordination, contract administration, and related service response.

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STREETS Summary: The Streets Division maintains the City of Navasota’s street and right-of-way infrastructure. Services include street repairs, drainage improvements, reconstruction, patching, seal coating, overlays, crack sealing, sidewalk maintenance and improvements, and related curb and gutter work. The division supports safe mobility, neighborhood access, and longterm maintenance of public infrastructure throughout the community.

Scope of Services: The Streets Division is responsible for maintaining City streets and related right-of-way infrastructure. The division performs and coordinates street and drainage repairs, reconstruction, patching, seal coating, overlays, crack sealing, sidewalk maintenance and improvements, and related curb and gutter work. These services help preserve public infrastructure, improve accessibility, support safe travel, and maintain reliable connections throughout the City.

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AIRPORT

Summary: The Airport Division operates and maintains the Navasota Municipal Airport, providing safe and reliable aviation facilities that support private, business, and community aviation needs.

Scope of Services: The Airport Division is responsible for the maintenance and operation of the Navasota Municipal Airport. Services include facility and grounds maintenance coordination, operational support, regulatory coordination, customer assistance, and maintenance of aviation facilities for private and business use.

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PARKS & RECREATION Summary: The Parks & Recreation Division enhances quality of life in Navasota by providing recreational opportunities, community programs, and welcoming public spaces for residents and visitors. Through the development of facilities, activities, and events, the Division encourages active lifestyles, community connection, and enjoyment of the City’s recreational resources. Parks and Recreation also oversees and manages the rental of City facilities, parks, fields, and other community spaces, ensuring that these resources are accessible, well-maintained, and available for community events, programs, gatherings, and private use.

Scope of Services: Parks & Recreation is responsible for planning, organizing, and implementing all projects involving recreation facilities, programs, and events in the City.

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LIBRARY

Summary: The Library Division provides accessible resources, programs, and services that support lifelong learning, literacy, and community engagement in Navasota. Through welcoming spaces, educational opportunities, and library resources, the Division serves residents of all ages and helps foster learning, connection, and enrichment throughout the community. The Division also oversees and manages the Navasota Farmers Market, supporting local vendors, promoting community commerce, and providing residents with opportunities to connect with local farmers, producers, and artisans.

Scope of Services: The Library is responsible for planning, organizing, and implementing all projects involving Library operations, maintenance, and programs.

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SWIMMING POOL

Summary: The Swimming Pool Division provides a safe, welcoming, and affordable recreational environment for residents and visitors during the summer season. Through recreational swimming, water safety programs, and family-friendly activities, the Division promotes active lifestyles, water safety, and opportunities for community enjoyment.

Scope of Services: The Swimming Pool Division oversees the operation of the City’s public swimming pool. Responsibilities include lifeguard staffing, water safety programming, facility maintenance, and seasonal recreational swimming activities. The division plays an important role in promoting water safety and providing affordable, family-friendly summer activities.

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KEEP NAVASOTA BEAUTIFUL

Summary: The Keep Navasota Beautiful Division promotes a clean, attractive, and sustainable community through beautification, environmental stewardship, and public engagement. By encouraging volunteerism, education, and community pride, the Division brings residents and community partners together to enhance Navasota’s appearance and preserve its environment for future generations.

Scope of Services: The Keep Navasota Beautiful (KNB) Division focuses on environmental stewardship, beautification, and community pride through initiatives such as litter abatement, public education, community cleanups, and landscaping projects. KNB works to engage residents, schools, and volunteers in efforts that enhance the visual appeal and sustainability of the City.

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FACILITY MAINTENANCE

Summary: The Facility Maintenance Division supports City operations by ensuring City-owned buildings and facilities are safe, reliable, and welcoming for employees and the public. Through ongoing care and maintenance of these spaces, the Division helps preserve City assets, extend their useful life, and provide functional environments for the delivery of City services.

Scope of Services: Facility Maintenance is responsible for the general upkeep, repair, and operations of all City-owned buildings and structures. The division provides custodial, HVAC, plumbing, electrical, and general building maintenance services to ensure safe and functional workspaces for City staff and welcoming environments for the public.

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PARK MAINTENANCE

Summary: The Park Maintenance Division supports a welcoming and enjoyable community by preserving the City’s parks, recreational areas, and green spaces. Through ongoing care of these public spaces, the Division helps protect City assets and provides safe, attractive, and accessible outdoor environments for residents and visitors to enjoy.

Scope of Services: Park Maintenance is responsible for the care and upkeep of the City’s parks, athletic fields, trails, playgrounds, and green spaces. The division ensures that outdoor public areas are safe, clean, and visually appealing for residents and visitors.

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FLEET MAINTENANCE

Summary: The Fleet Maintenance Division supports reliable and efficient City operations by ensuring municipal vehicles and equipment remain safe, dependable, and ready for service. Through proactive maintenance and repair, the Division helps extend the life of City assets, reduce operational disruptions, and provide departments with the vehicles and equipment needed to effectively serve the community.

Scope of Services: Fleet Maintenance oversees the repair, service, and preventative maintenance of the City’s vehicle and equipment inventory. This includes police vehicles, utility trucks, heavy equipment, and other departmental assets critical to day-to-day operations.

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UTILITY FUND SUMMARY

UTILITY FUND STATEMENT OF REVENUES

WATER PRODUCTION Summary: The Water Production Division provides safe, high-quality drinking water from groundwater sources for residential and commercial use. The division maintains adequate water reserves and system pressure for daily use and fire protection, monitors water quality, and performs routine and emergency maintenance on water production equipment.

Scope of Services: The Water Production Division is responsible for producing water that meets state and federal standards for residential and commercial use. The division operates and maintains groundwater wells, treatment facilities, storage facilities, pumps, controls, and related equipment; provides adequate water reserves and pressure for fire protection; monitors water quality; and performs routine and emergency repairs.

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WATER DISTRIBUTION Summary: The

Water

Distribution

Division

provides

reliable

water

service

residential

and

commercial customers throughout the City of Navasota. The division maintains and repairs the water distribution system, including mains, service lines, fire hydrants, valves, and meters,

while

responding

customer

service

needs

and

supporting

affordable,

dependable water delivery.

Scope of Services: The Water Distribution Division is responsible for distributing water to residential and commercial customers and responding to customer service concerns related to the water system. Additional responsibilities include maintaining, repairing, and reconstructing water mains, service lines, fire hydrants, valves, and meters while providing an acceptable level of service at an affordable rate.

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ENTERPRISE FUND

Summary: The Enterprise Funds manage the City of Navasota’s essential utility services, including natural gas distribution and wastewater collection and treatment. These services support public health, safety, environmental stewardship, and reliable utility service for residents and businesses. The funds focus on critical infrastructure maintenance, regulatory compliance, emergency response, and quality service delivery.

Scope of Services Summary The Enterprise Funds support the City of Navasota’s natural gas and wastewater services. Services include natural gas distribution, wastewater collection and treatment, infrastructure maintenance, utility system improvements, regulatory compliance, customer service response, and the safe and reliable delivery of essential utility services to residents and businesses.

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GAS FUND SUMMARY

GAS FUND STATEMENT OF REVENUES

GAS DISTRIBUTION Summary: The Gas Distribution Division provides safe, reliable, and efficient natural gas service to residential, commercial, and industrial customers throughout Navasota. The division maintains and improves the City’s gas system while prioritizing safety, regulatory compliance, emergency response, and responsive customer service.

Scope of Services: The Gas Distribution Division operates and maintains the City’s natural gas distribution system. Services include infrastructure maintenance and upgrades, safety and regulatory compliance, leak response, service requests, gas usage records, emergency response, and on-call support for system maintenance and gas-related emergencies.

Expenditures by Category:

Personnel Position Roster:

WASTEWATER FUND SUMMARY

WASTEWATER FUND STATEMENT OF REVENUES

WASTEWATER TREATMENT PLANT

Summary: The Wastewater Treatment Division manages the treatment and safe discharge of wastewater for the City of Navasota. The division oversees treatment processes, monitors industrial waste discharges, and maintains essential equipment to ensure reliable operations and compliance with environmental and water quality standards.

Scope of Services: The Wastewater Treatment Division is responsible for wastewater treatment process control, discharge quality, monitoring industrial waste discharges, regulatory compliance, and maintaining and repairing pumps, motors, controls, and other equipment related to treatment operations.

Expenditures by Category:

Personnel Position Roster

WASTEWATER COLLECTION

Summary: The Wastewater Collection Division manages the collection and transportation of wastewater for treatment throughout the City of Navasota. The division maintains and repairs sewer lines and lift station equipment while responding to customer concerns and system emergencies to ensure reliable wastewater service.

Scope of Services: The Wastewater Collection Division is responsible for collecting wastewater for treatment, maintaining and repairing collection system lines and lift station equipment, responding to customer complaints and system problems, supporting emergency repairs, and helping reduce service disruptions through maintenance and system monitoring.

Expenditures by Category:

Personnel Position Roster

TIRZ FUND SUMMARY

TIRZ FUND STATEMENT OF REVENUES

FIRE SERVICE BOARD FUND SUMMARY

FIRE SERVICE BOARD FUND STATEMENT OF REVENUES

CEMETERY FUND SUMMARY

CEMETERY FUND STATEMENT OF REVENUES

CEMETERY Summary: The Cemetery Division manages the care, maintenance, and administration of the City of Navasota’s municipal cemetery. The division coordinates burial services, maintains cemetery grounds and records, manages plot sales, and assists families, funeral homes, and monument companies with professional and compassionate service.

Scope of Services: The Cemetery Division is responsible for the care, maintenance, and administration of the municipal cemetery in Navasota. The Division ensures respectful, timely, and professional interment services while preserving the dignity and historical significance of the cemetery grounds. Services are provided in accordance with municipal policy, state law, and community expectations for compassionate service delivery.

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VOLUNTARY DONATIONS FUND SUMMARY

VOLUNTARY DONATIONS FUND STATEMENT OF REVENUES

ECONOMIC DEVELOPMENT CORPORATION FUND SUMMARY

ECONOMIC DEVELOPMENT FUND STATEMENT OF REVENUES

ECONOMIC DEVELOPMENT CORPORATION Summary: The Economic Development Division supports business growth, investment, and economic opportunities in Navasota. The division works with the Navasota Economic Development Corporation Board, City leadership, and regional partners on business retention and expansion, small business development, marketing, workforce initiatives, transportation issues, and quality of life efforts. The division also assists new and existing businesses with navigating City planning, zoning, permitting, and development processes.

Scope of Services: The Economic Development Corporation works with the Economic Development Division to establish direction and policies related to economic development projects in the City. The division supports business retention and expansion programs, small business development, marketing efforts, workforce initiatives, transportation coordination, quality of life initiatives, and serves as a business ombudsman for new and existing businesses navigating City processes.

Expenditures by Category:

HOTEL/MOTEL FUND SUMMARY

HOTEL/MOTEL FUND STATEMENT OF REVENUES

HOTEL/MOTEL

Summary: The Hotel/Motel Fund supports tourism and promotes the hotel and convention industry within the City of Navasota. The fund provides support for eligible projects, programs, events, marketing, and tourism-related initiatives that attract visitors, encourage overnight stays, and contribute to the local tourism economy.

Scope of Services: The Hotel/Motel Fund is used to directly enhance and promote tourism and the convention and hotel industry within the City of Navasota. Funds support eligible projects, programs, events, marketing, and other tourism-related activities designed to attract visitors to the area and strengthen the local visitor economy.

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VEHICLE REPLACEMENT FUND SUMMARY

CAPITAL IMPROVEMENTS FUND SUMMARY

CAPITAL IMPROVEMENTS (CIP) FUND STATEMENT OF REVENUES

UTILITY CIP FUND SUMMARY

UTILITY CIP FUND STATEMENT OF REVENUES

DEBT SERVICE FUND SUMMARY

DEBT SERVICE FUND STATEMENT OF REVENUES

City of Navasota Certificates of Obligation, Series 2026 $7,640,000

City of Navasota Government Capital Corporation $1,033,020.60

City of Navasota 2022 Tax & Rev Certificates of Obligation Bonds $6,755,000

City of Navasota 2020 Certificates of Obligation Bonds $9,865,000

On December 9, 2020, the City issued Combination Tax and Limited Surplus Revenue Certificates of Obligation, Series 2020, in the amount of $9,865,000. The CO's were issued for the purpose of constructing and improving streets and roads, including related drainage, signalization, landscaping, sidewalks, lighting, utility relocation and replacement, bridges, signage, and streetscape improvements. The CO's were also issued for acquiring, constructing, installing, and equipping additions, improvements, extensions, and equipment. The CO's have an interest rate of 4% and mature on September 30, 2041. Payments of the CO's will be made from levying ad valorem taxes and also utility system revenues.

City of Navasota Capital One Public Funding $3,660,222.70

On August 29, 2019, the City entered into a financing agreement with Capital One Funding LLC for the purpose of financing Water Meters, Gas Meters, work on the Recreation Center, work on the Public Library, work on the Sewer Plant Building, Vehicle Maintenance, and work on City Hall. Financing includes various payments until the year 2040. Interest rate is 3.25%.

City of Navasota 2017 General Obligation Refunding Bonds $8,145,000

City of Navasota 2016 Tax & Rev Certificates of Obligation Bonds $3,240,000

PROPOSED PAY SCHEDULE

GLOSSARY OF TERMS A Account: A term used to identify an individual asset, liability, expenditure control, revenue control, encumbrance, or fund balance. Accrual Accounting: A basis of accounting under which transactions are recognized, regardless of the timing of related cash flows; for example, in accrual accounting, revenue that was earned between April 1st and June 30th but for which payment was not received until July 10th is recorded as being received on June 30th rather than July 10th. Amortization: The process of paying the principal amount of debt in periodic payments. Appropriation: The legal authorization to make expenditures or enter into obligations for specific purposes. Assessed Valuation: A valuation set upon real property or other property by a government as a basis for levying taxes. Assessed value of property is determined by the Grimes County Appraisal District, typically at market value. Arbitrage: The practice of investing proceeds from a tax-exempt instrument in higheryielding investments. Assets: Property owned by the city government that has monetary value. Audit: An independent, objective evaluation of an organization’s financial reports and reporting processes. The primary purpose of an audit is to give citizens, Council members, regulators, investors, directors, and managers reasonable assurance that financial statements are accurate and complete. Financial audits for the City of Navasota are conducted by an independent and professional auditing firm.

B Balanced Budget: A budget in which current revenues equal current expenditures. Budgets may be balanced after expenditures have been prepared by adjusting taxes and fees to generate total current revenues by drawing down fund balances accumulated from prior years or by short-term borrowing to make up the difference between revenues and taxes and other income and current expenditures. Bond: Bonds or municipal bonds are debt issued by local governments for the financing of government activities, such as capital projects. Bonds are loans that investors make to local governments and that local governments agree to pay back over time with interest. Bond Premium: Bond premium is the difference between the bond’s current price (or carrying value) and the bond’s face value; it is the excess price (premium) paid for a bond. Budget Amendment: A revision of the adopted budget that replaces the original provision when approved by the council. Budget amendments frequently occur throughout the fiscal year as spending priorities shift.

GLOSSARY OF TERMS Budget Calendar: The schedule of dates used as a guide to complete the various steps of the budget preparation and adoption process. Budget Message: A general discussion of the proposed budget, as presented in writing by the City Manager, addressed to the Mayor, City Council, and citizens. Budget Ordinance: The official enactment by the City Council establishing the legal authority for officials to obligate and expend resources.

C Capital Assets: Assets of significant value (over $5,000) having a useful life of several years, also called fixed assets. Capital Budget: A plan of proposed capital outlays and the means for financing them. Usually enacted as part of the complete annual budget. Capital Improvements: landfills.

Projects which are long term assets such as roads, buildings, and

Cash Basis: A type of accounting in which transactions are recognized typically when cash changes hands. Chart of Accounts: various funds.

The classification system used by a city to organize the accounting for

Certificate of Obligation: A bond issued by a city without voter approval for construction of any public work, purchase of items related to the bond, and/or payment of contractual obligations for professional services.

D Debt Service: Payments of principal and interest on bonds and other debt instruments according to a pre-determined schedule. Debt Service Fund: A fund established to finance and account for the accumulation of resources for, and the payments of, general long-term debt principal and interest. Also called a sinking fund. Department: An organizational unit responsible for providing programs, activities, and functions in a related field. Depreciation 1. Expiration in the service life of capital assets, attributable to wear and tear through use and lapse of time, obsolescence, inadequacy, or other physical or functional cause. 2. The portion of the cost of a capital asset charged as an expense during a particular period.

GLOSSARY OF TERMS E Encumbrance: Obligations in the form of purchase orders, contracts, or salary commitments which are chargeable to an appropriation and for which a part of the appropriation is reserved. They cease to be encumbrances when paid or when the actual liability is set up. Enterprise Fund: A proprietary fund type established to finance and account for an operation that is financed and operated in a manner similar to private business enterprises - whereby the intent is that the costs (expenses, including depreciation) of providing goods or services to external customers on a continuing basis be financed or recovered primarily through user charges. Examples of enterprise funds are those for water and wastewater services. Expenditures: If the accounts are kept on an accrual basis, this term designates total charges incurred, whether paid or unpaid, including expenses, provision for retirement of debt not reported as a liability of the fund from which retired, and capital outlays. Note: Encumbrances are not considered expenditures. Extraterritorial Jurisdiction (ETJ): The land bordering a city’s limits that the city has limited control over but does not furnish city services to nor collect ad valorem taxes from. This is an area outside of city limits that may be subject to annexation.

F Fiscal Year (FY): A twelve-month period to which the annual budget applies and at the end of which a city determines its financial position and results of operations. The City of Navasota fiscal year begins each October 1 and ends the following September 30. Fixed Assets: Assets of long-term character that are intended to continue to be held or used, such as land, buildings, machinery, furniture, and other equipment. Franchise Fee: A charge by the city for a special privilege granted by the city permitting the continued use of public right-of-way, usually involving elements of monopoly and regulations (e.g., Comcast, CenterPoint). Full-Time Equivalent (FTE): A measure of authorized personnel calculated by dividing hours of work per year by the number of hours worked per year by a full-time employee. Fund: A fiscal and accounting entity with a self-balancing set of accounts recording cash and other financial resources, together with all related liabilities and residual equities or balances, and changes therein, which are segregated for the purpose of carrying on specific activities or attaining certain objectives in accordance with special regulations, restrictions, or limitations. Fund Balance: carryover.

The difference between the assets of a fund over its liabilities, reserves and

GLOSSARY OF TERMS G Generally Accepted Accounting Principles (GAAP): Generally Accepted Accounting Principles, these are the uniform minimum standards for financial recording and reporting and are established by the accounting profession through such independent entities as the Government Accounting Standards Board (GASB). Governmental Accounting Standards Board (GASB): A governing board set up to establish and improve standards of state and local governmental accounting and financial reporting that will result in useful information for users of financial reports and guide and educate the public, including issuers, auditors, and users of those financial reports. General Fund: The fund used to account for all financial resources except those required to be accounted for in another fund. The General Fund is tax supported and includes most of the basic operating services, i.e. police, streets, parks and recreation, and administration. General Obligation Bonds: Bonds for whose payments the full faith and credit for the issuing body are pledged. More commonly, but not necessarily, general obligation bonds are those payable from taxes and other general revenues. Governmental Fund: The broadest category of fund types which includes those funds that are used to account for tax-supported (governmental activities). Grant: A contribution by one governmental unit to another. The contribution is usually made to aid in the support of a specified function. Grimes Central Appraisal District: within the district.

Entity that is responsible for the appraisal of all property

H Homestead Exemption: Designed to protect the value of the residents from property taxes, creditors, and circumstances arising from the death of the homeowner’s spouse.

I Interfund Transfers: entity.

The movement of monies between funds of the same governmental

Intergovernmental Revenue: Funds received from federal, state and other local government sources in the form of grants, shared revenues and payments in lieu of taxes. Internal Control: A plan of organization for purchasing, accounting, other financial activities which, among other things, provides that: the duties of employees are subdivided so that no single employee handles a financial action from beginning to end; proper authorizations from specific responsible officials are obtained before key steps in the processing of transactions are completed; and records and procedures are arranged appropriately to facilitate effective control.

GLOSSARY OF TERMS Internal Service Fund: A proprietary fund type that may be used to report any activity that provides goods or services to other funds, departments, or agencies of the primary government and its component units. Investments: Securities and real estate held for the production of income in the form of interest, dividends, rentals, or lease payments. The term does not include fixed assets used in the city operations.

L Levy: To impose taxes for the support of government activities. Liability: Probable future sacrifices of economic benefits, arising from present obligations of a particular entity to transfer assets or provide service to other entities in the future as a result of past transactions or events.

M Maturities: The dates on which the principal and stated values of investments or debt obligations mature and may be reclaimed. Modified Accrual, Basis of Accounting: An accounting theory whereby a) revenues are recognized in the accounting period in which they become available and measurable and b) expenditures are recognized in the accounting period in which the liability is incurred, if measurable. This differs from the full accrual basis, which recognizes the financial effect of transactions when they occur, regardless of the timing of related cash flows. Both differ from the cash basis of accounting that recognizes transactions when related cash amounts are received or disbursed.

N No New Revenue Tax Rate: Formerly the Effective Tax Rate, when compared to the same property, the tax that produces the same amount of the total amount of taxes as compared to the prior year, based on the value of properties taxed in both years.

O Operating Expense: As used in the accounts of governmental enterprises of a business character, the term means such costs as are necessary to the maintenance of the enterprise, the rendering of services for which operated, the sale of merchandise, the production and disposition of commodities produced, and the collection of the revenues. Ordinance: A formal legislative enactment of the city carrying the full force and effect of a law within the city. An ordinance has more legal formality than a resolution, which has lower legal status. Enactment of ordinances is often specified or implied by the City Charter. Revenue – raising measures or assessment of fees and fines are normally established by ordinance.

GLOSSARY OF TERMS P Property Tax: Taxes levied on all real and personal items according to the property’s valuation and the tax rate, in compliance with the State Property Tax Code. Proprietary Fund: A fund used in governmental accounting to account for activities that involve business-like interactions, either within the government or outside of it. Types of proprietary funds include enterprise funds and internal service funds. Public Funds Investment Act: A law that governs the investment of government funds in Texas. Under this law, specific parameters are set for Texas cities, requiring them to adopt an investment policy and to designate an investment officer who is required to attend an approved training course. The act, first adopted in 1995 and most recently amended in 2003, also limits the types of investments that can be made and requires quarterly reporting of investment activity to the governing body. Public Improvement District: A defined geographical area established to provide specific types of improvements or maintenance within site, financed by assessments against the property owners within the region. Chapter 372 of the Texas Local Government Code authorizes the creation of PIDs by cities. Purchase Order: A document that authorizes the delivery of specified merchandise or the rendering of certain services and the making of a charge for them.

R Reserve: An account used to indicate that a portion of fund equity is legally restricted for a specific purpose or not available for appropriation and spending. Retained Earnings: An ownership account reflecting the accumulated earnings of a proprietary-type fund. Revenue: The yield of taxes and other sources of income that the city collects and receives into the treasury for public use. For those revenues that are recorded on the accrual basis, this term designates additions to assets that: (a) do not increase any liability; (b) do not represent the recovery of an expenditure; (c) do not represent the cancellation of certain liabilities without a corresponding increase in other liabilities or a decrease in assets; and (d) do not represent contributions of fund capital in enterprise and internal service funds.

S Sales Tax: A general “sales tax” is levied on persons and businesses selling merchandise or services in the city limits on a retail basis. The categories for taxation are defined by state law. Money collected under the authorization of this tax is for the use and benefit of the City of Navasota.

GLOSSARY OF TERMS T Tax Rate: The amount of tax levied for each $100 of taxable valuation. The tax rate multiplied by the taxable valuation equals the tax levy. Truth in Taxation: A concept embodied in the Texas Constitution that requires local taxing units to make taxpayers aware of tax rate proposals and to afford taxpayers the opportunity to limit tax increases.

(936) 825-6475 200 E. McAlpine Street Navasota, TX 77868

Proposed Budget Book FY2026-2027