INTELLIGENCE REPORT: KILLEEN, TEXAS – 2026 OUTLOOK

TO: Stakeholders and Residents of Killeen, Texas

FROM: VeteranJaime – CTX Private Intelligence Network

DATE: January 2, 2026

SUBJECT: City Council Strategic Initiatives and Community Concerns for FY 2026

1. EXECUTIVE SUMMARY

As Killeen enters 2026, the city is navigating a period of significant transition characterized by rapid population growth, fiscal restructuring, and political reform. While the City Council has outlined a robust calendar of community events and infrastructure projects, underlying concerns regarding tax increases, public safety staffing, and electoral changes remain central to public discourse. This report details the key findings from the 2026 strategic outlook and assesses the impact of these developments on the local population.

2. KEY FINDINGS & POTENTIAL CONCERNS

A. Fiscal Pressure and Property Tax Increases

Finding: The FY 2026 budget introduces a tax rate of 68.30 cents per $100 valuation, an increase from the previous year’s 65.73 cents. This is largely driven by the “Interest & Sinking” (I&S) portion to fund debt obligations.
The Concern: Despite a slight decrease in the Maintenance & Operations rate, the overall tax burden is rising. A critical factor is the Disabled Veterans Exemption, which has grown to over $2.4 billion in exempt value. The state currently only reimburses the city for approximately 5.69% of this lost revenue.
Why It Matters: As the city’s population nears 165,000, the shrinking tax base places a heavier financial burden on non-exempt residents and businesses to maintain essential services like road repair and public safety.

B. Major Electoral Reform (SB 1494)

Finding: In late 2025, the City Council voted to move municipal general elections from May to November of odd-numbered years, beginning in 2027. A general election will still be held in May 2026 to elect the Mayor and at-large council members.
The Concern: This shift eliminates staggered terms and will result in the entire council being elected at once in the future.
Why It Matters: Moving to November typically increases voter turnout due to alignment with state/federal cycles, but electing the entire council simultaneously could lead to a complete lack of institutional continuity if a “clean sweep” occurs during a period of political unrest.

C. Public Safety and Infrastructure Reinvestment

Finding: The 2026 budget prioritizes a new Crime Scene Unit (4 positions) and operations for a Real-Time Crime Center. It also funds infrastructure designs for Zephyr and Rancier Roads.
The Concern: Killeen continues to face high demand for services, with over $5.6 million in “unfunded decision packages” (requests that could not be fit into the budget).
Why It Matters: While the city is investing in technology (Axon equipment, cardiac monitors), the gap between service demand and available funding could lead to slower emergency response times or further degradation of older infrastructure in high-traffic corridors.

D. Utility Rate Adjustments

Finding: Residents will see a $0.50 increase to the base water rate and updates to volumetric rates. This is part of a multi-year plan to stabilize the Water and Sewer Fund.
The Concern: Cumulative increases in utilities, paired with property tax hikes, may impact the cost of living for low-to-moderate-income families.
Why It Matters: Financial stability in the utility fund is required for critical sewer line upgrades, but the immediate impact is a higher monthly “entry cost” for basic necessities.

3. STRATEGIC OUTLOOK

The City of Killeen is attempting to balance its “hometown feel” with the realities of being a major Texas urban center. Residents should remain engaged with the Five-Year Strategic Plan town halls, as these meetings will dictate how the city prioritizes digital library services, population growth management, and future investment.

Potential Flashpoints in 2026:

May 2026 General Election: Likely to be a referendum on the recent tax increases and the Council’s handling of the state’s veteran exemption shortfall.
Water Infrastructure: Ongoing boil water notices (seen in late 2025) suggest that the system remains under stress during repairs and upgrades.