Rollingwood homeowners will pay more in city property taxes this year even though the City Council just lowered the tax rate. The average taxable homestead value climbed to $2,642,165, up from $2,507,067 the year before, pushing the average annual city tax bill to $5,187 — a $122 jump from $5,065 in the prior fiscal year.
Council Approves Lower Rate, But Values Keep Climbing
According to Community Impact, the Rollingwood City Council approved the fiscal year 2026-27 budget and tax rate, setting the no-new-revenue rate at $0.196327 per $100 of assessed valuation, down from $0.202039 the year before. Some homeowners may still end up paying more in property taxes than last year simply because the average homestead taxable value rose so sharply, the outlet reports. City officials anticipate property taxes will contribute over $1.8 million to the budget, an increase of $69,000 from the prior year.
Mayor Gavin Massingill said the city has a responsible baseline budget that funds essentials and forward-looking improvements, per the same report. The council's approval of the municipal budget followed public hearings that opened September 2, though no public testimony was recorded during that session, according to Citizen Portal.
General Fund Faces $1.2 Million Shortfall
The numbers behind the new budget reveal a tighter picture than the tax-rate cut might suggest. Rollingwood's fiscal year 2026-27 general fund includes $3.98 million in total revenue against $5.22 million in expenditures, leaving a projected shortfall of more than $1.2 million, the article notes. Administration revenues make up over 82% of general fund revenues and increased 3% compared with the previous fiscal year.
Police department spending helped offset some of that gap. The Rollingwood Police Department received $1.89 million in fiscal year 2026-27 expenditures, a decrease of nearly $1 million from $2.87 million the prior year, per the same account. Of that total, over $1.45 million is allocated for salaries, with the remainder covering equipment, dispatch and other contractual services. The budget and new tax rate take effect October 1, 2026.
How the Rate Is Calculated Under Texas Law
Rollingwood's no-new-revenue rate reflects a standard mechanism under Texas Truth-in-Taxation statutes, which allow property owners to evaluate year-over-year tax changes by calculating the rate needed to raise the exact same total property tax revenue from existing properties as the prior year, according to the Texas Comptroller. Texas Tax Code Section 26.04 separately requires taxing units to compute a voter-approval tax rate, which caps how much a municipality can raise rates without triggering a mandatory election, as outlined by FindLaw.
The pattern isn't new for Rollingwood. For fiscal year 2025-26, the city adopted a voter-approval rate of $0.202039 per $100 valuation, a 1.8% reduction from $0.2058 the year before, which still generated $103,453 in additional property tax revenue year-over-year, Community Impact reported at the time. Two fiscal years earlier, the city's adopted rate of $0.1917 per $100 valuation raised $361,669 more in revenue than the year before it, a 13.96% single-year increase, according to city budget records from the City of Rollingwood.
Regional Comparison and the Bigger Tax Picture
Rollingwood isn't alone in navigating this dynamic. Neighboring West Lake Hills adopted an FY 2026-27 no-new-revenue tax rate of $0.174896 per $100 valuation, which actually reduced its average annual municipal tax bill by over $40 to $3,918.36 on an average appraised residence of nearly $2.49 million, as Hoodline previously reported.
Rollingwood homeowners also answer to the Eanes Independent School District, which approved a total tax rate of $0.8254 per $100 valuation for fiscal year 2026-27 — split between $0.7054 for maintenance and operations and $0.12 for debt service — down from $0.8322 the year before, per Community Impact's education coverage. That means the school district still levies a far larger share of the typical Rollingwood tax bill than the city itself.
The city's tax base is unusually concentrated in high-value homes. U.S. Census Bureau data compiled for 2024 shows Rollingwood has a population of 1,316 residents, a median household income of $240,114, a median property value of $2 million, and a homeownership rate of 91.1%, according to Data USA. Separately, the council has also explored non-tax revenue options: in May 2026, it evaluated regulations, permitting requirements, and fee structures for commercial film and television productions after an inquiry from a Fortune 100 corporation, Community Impact reported at the time. How the city plans to close the roughly $1.2 million general fund gap over the fiscal year that begins October 1 remains an open question.
