City officials say specialized expenses—such as emergency vehicles, road materials and public-safety facilities—are increasing much faster than tax and fee collections

Lubbock officials are preparing for a difficult 2026-27 budget process as modest revenue growth collides with rapidly increasing costs for vehicles, construction materials, employee compensation and other municipal needs.

City Manager Jarrett Atkinson and members of the Lubbock City Council discussed the developing financial picture during a July 9 planning session. The meeting was preliminary: Council members did not vote on a tax rate, spending plan or service reductions, and the city has not released a complete proposed budget for the fiscal year beginning Oct. 1.

The city’s official meeting agenda described the session as an opportunity to establish goals and budget priorities across numerous departments. The agenda expressly stated that no action would be taken.

The central problem is that revenue from taxes and municipal fees is expected to increase by only about 1%, Councilman Tim Collins said, while many of the products and services purchased by the city are rising much faster.

Atkinson described the trend as a form of municipal inflation that is not adequately captured by the consumer price indexes commonly used to measure household expenses. Cities must purchase specialized equipment—including fire engines, police vehicles, garbage trucks and road materials—that can experience much steeper price increases.

A fire truck, for example, is expected to cost approximately 15% more than it did a year ago, according to figures discussed during the meeting. Hot-mix asphalt used for street work has nearly doubled in price over four years.

Police vehicles present another challenge. The cost of a basic police unit has increased by about 58%, with the vehicle alone now costing more than $84,000. Once outfitted with emergency lights, communications equipment and other law-enforcement technology, a patrol vehicle can cost approximately $110,000.

That means hiring nine additional police officers could require close to $1 million just to provide their vehicles, before accounting for salaries, benefits, training or other equipment. Those figures were first detailed in Lubbock Lights’ coverage of the city’s budget discussion.

Revenue is growing, but not quickly enough

Lubbock is not necessarily experiencing a collapse in revenue. Instead, officials are concerned that its growth is too slow to absorb the city’s higher operating and capital costs.

General-fund revenue increased by nearly 8% during fiscal 2022-23, but its annual growth had fallen to approximately 1.6% by the most recently completed fiscal year.

Sales-tax collections have also been volatile. A slowdown during fiscal 2024-25 contributed to a roughly $5 million shortfall and prompted the city to impose spending reductions and a hiring freeze. Collections during the opening months of fiscal 2025-26 subsequently came in about 6% above the city’s deliberately conservative forecast, according to KCBD’s February report.

The stronger early results offer some relief, but they do not eliminate the longer-term mismatch between revenue and specialized municipal costs. Property-tax growth has also slowed, while Council members remain under political pressure to avoid substantial tax-rate increases.

The city entered the current fiscal year with a property-tax rate of 47.2191 cents per $100 of taxable value. The Council adopted that rate in September 2025 as part of the 2025-26 budget. A rate for 2026-27 has not yet been proposed or approved.

Public safety and infrastructure remain priorities

Officials identified several significant needs that could compete for general-fund resources during the coming budget year. They include a police driver-training facility, a combined police and fire training facility, another fire station and an additional service center with fuel capacity.

Atkinson said the city currently lacks a municipal fuel station west of Avenue P. As a result, some employees and vehicles must travel from western areas to facilities at Municipal Hill or near 84th Street and Avenue P, consuming both fuel and staff time.

Employee compensation will also affect the budget. The city must account for step-pay obligations and negotiations with police and fire employee associations. At the same time, Lubbock’s municipal workforce has not grown as quickly as its population. The number of city employees per 1,000 residents reportedly declined from 6.35 to 6.1 over four years.

Council members must therefore decide how to balance staffing, public safety, road maintenance, facilities and other services without committing to recurring expenses that projected revenue cannot reliably support.

A strategic discussion conducted during the July meeting identified Lubbock’s management, employees and public-safety services as strengths. Participants also cited unequal conditions between newer and older areas of the city as a weakness, aging infrastructure as a threat and downtown redevelopment—including potential Civic Center improvements—as an opportunity.

Those priorities could create difficult choices. Increasing taxes or fees would generate more money but place additional costs on residents and businesses. Holding revenue flat could require projects to be delayed, vacancies to remain unfilled or service levels to be reconsidered.

No such decisions were made during the July work session, and officials did not present a finalized dollar amount for a projected shortfall. The city’s budget workshop page currently provides documents for the existing 2025-26 fiscal year rather than a completed 2026-27 proposal.

A formal spending plan and proposed tax rate are expected later in the summer, followed by the required public review and Council action. Lubbock must approve its next budget before the current fiscal year ends Sept. 30.