The URL can be used to link to this page

Item 6O-6RFY 2016 Proposed BudgetItems 6O – 6R September 1, 2015 Sharen: Thank Council for opportunity to present Taking the next step required for the formal adoption of the FY 2016 proposed budget 1 Council Action Requested Sharen: Four items requiring action the agenda this evening Items shown on the screen One presentation L:Budget/FY2011/Presentations/Overview FY2011 Budget Presentation.pptx 2 FY 2016 Revenue Sources Sharen Overall budget is comprised of many different funds Have their own revenue source Expenditures often restricted for certain uses All work together to fund service delivery Largest is the General Fund (most city operations) Second largest is Utility Fund (enterprise fund for water, sewer, garbage) 3 FY 2016 Planned Expenses $86,972,982 Sharen: Slide shows the proposed expenditures for each of the funds As shown on this slide, the total budget for FY 2016 is about $86.9 million Comparing the FY 2015 Adopted Budget to the FY 2016 Proposed Budget, expenses are increasing 0.3% I want to note that the “other” category depicted on the slide includes the following funds: Reforestation: $70,000 Park Dedication: $80,000 Parks/Rec (Sponsorship Fund): $81,000 Library Donation Fund: $10,000 Vehicle Replacement Fund: $538,000 Court Security: $85,504 Court Technology: $81,500 Red Light Camera: $380,160 Public Art: $135,500 Commercial Vehicle Enforcement: $123,201 4 Tax Information Sharen: Any discussion of the budget begins with tax information The property tax gets the most interest, so we’ll begin with information about it 5 FY 2016 BudgetProperty Tax At A Glance Tax Rate Sharen: The first thing to note is that no tax rate increase is proposed for this year. The tax rate of .462 per $100 valuation is proposed, the same tax rate that has been in place for 13 years. The tax rate is split between an allocation for operations and an allocation for debt service. Currently 34 cents ops/12 cents for debt service The debt service tax rate for FY 2016 will be reduced to $0.10, two cents less than the rate adopted for FY 2015. This reflects the reallocation of these tax rate pennies to the operating fund which is now at $0.36. This will allow us to proceed with projects without having to issue additional debt. Staff analysis has shown this tax rate to be sufficient for covering existing General Fund debt. This year’s budget also increases the homestead exemption, changing it from 10% to 12%. 6 FY 2016 BudgetTax Rate *This analysis assumes that other taxing entities make no changes to their tax rates for FY 2016. Sharen: Ours is only one portion of overall tax bill COS constitutes 17% of total taxpayer bill 7 City Property Tax Bill for Average Home FY 2016 BudgetTax Impact Sharen: This chart shows the city property tax bill for an average valued home in Southlake, based on the current tax rate and including the 12% FY 2016 exemption. 8 Homestead Exemption $66,900 (average priced home) FY 2016 Budget Property Tax At A Glance Sharen: CC has approved an increased exemption. For an average priced home ($557,693) in Southlake, this equates to about a $66,900 exemption or a FIVE AND ONE-HALF cent tax rate reduction. This exemption will save the homeowner OF AN AVERAGE VALUED HOME $309 a year IN TAXES. The impact to the City’s budget is a revenue reduction of over $3 MILLION, which is inclusive of both the general fund operation portion of the tax rate, as well as the debt service portion. 9 Capital Projects and Debt Sharen: At the last CC meeting we discussed the strategic investments planned with the proposed FY 2016 budget We noted that no debt would be issued for CIP projects this year, with the exception of the funds needed for The Marq Phase 2 10 FY 2016 CIP Projects By Type Sharen: Being asked to approve CIP The FY 2016 portion is a $48 million plan Slide shows the break down of the uses, with most of the dollars going to The Marq this year General Fund $6,500,000 Utility Fund $ 850,000 Roadway Impact Fee $ 200,000 Water Impact Fee $2,350,000 Sanitary Sewer Impact Fee $2,000,000 Storm Water Utility System Fund $1,470,000 Crime Control $1,200,000 Hotel Occupancy Tax Fund $ 200,000 CEDC $30,291,000 SPDC $3,000,000 Grand Total All Funds: $48,061,000 11 FY 2016 CIP Projects By Funding Source Sharen: This slide shows the various funding sources for CIP Many of these sources are dedicated – that is, they can only be used for certain purposes General Fund $6,820,000 Utility Fund $3,400,000 Water Impact Fee $550,000 Sanitary Sewer Impact Fee $350,000 Storm Water Utility System Fund $1,235,000 Red Light Camera Fund $200,000 Hotel Occupancy Tax Fund $200,000 Park Dedication Fee Fund $235,000 SPDC $1,000,000 Grand Total All Funds: $13,990,000 12 FY 2016 General Fund Budget Sharen: Transferring dollars over the City’s optimum fund balance to the Strategic Initiative Fund provides cash funding for capital projects addressing the City’s master plans. For FY 2016, $6.5 million dollars in cash will be available for use in funding the General Fund CIP. That is sufficient to cover the cost of ALL OF the FY 2016 general fund capital budget and provides that no bonds will need to be issued for this purpose. Note: Also – We are cash funding all CIP projects this year… The only bonds we plan to issue are those required for the voter-approved Marq. 13 FY 2016 Debt Service HighlightsProperty Tax Supported Debt 85% 10 years Sharen: The City has over the years issued certificates of obligation to fund many of its capital improvement programs. It is important to note that about 85% of the City’s overall existing property tax supported debt will be retired within the next ten years. This reflects aggressive amortization schedules and the City’s efforts over the past decade to use cash funding for certain projects. No debt for this year’s capital budget means that we will not be adding to the debt load that is supported by property taxes. 14 Debt Reduction Trend Sharen: Chart shows two things: First, overall property-tax supported debt is declining Second, debt as a percent of assessed value has declined significantly This is a measure used by bond rating agencies, financial advisors Balance: debt to build infrastructure versus underinvestment OR intergenerational equity issues Industry warning signals for this measure – overall PTS debt exceeding 10 percent of assessed value (we are at 0.92%) Since 2002, the City’s has reduced its property tax supported debt as a percentage of assessed value by almost 75% Since 2003, the City’s has reduced its total outstanding property tax supported debt by 38%. (or over 1/3) 15 Crime Control & Prevention DistrictFY 2016 Budget Sharen: State law requires you to specifically approve the CCPD budget and hold a public hearing Highlights of the fund are shown on the slide Decrease of 74.7% in revenue from the FY 2015 Adopted Budget, reflecting the reallocation of three-eighths cent sales tax to Community Enhancement and Development Corporation (CEDC). Operating expenses: SRO program - $556,702; NETCO (joint dispatch) equipment - $62,414; Police body worn cameras - $27,210; Police Dash cameras - $167,770; and radio bidirectional amplifiers - $60,000 Debt service transfer = $2.6 million; CIP transfer of $1.2 million (DPS West Reconfiguration); Indirect charge of $66,720 Budget approved by CCPD Board of Directors in July 16 Budget Information cityofsouthlake.com/FY2016 Sharen: As a reminder – there is quite a bit of information related to the budget We’ve put the budget materials on our website for ease of review Encourage people to visit and take a look at it 17 www.cityofsouthlake.com/FY2016 Questions? The proposed budget is a sound budget It is structurally balanced It provides taxpayer relief, while enhancing services I’ll be happy to entertain any questions you may have at this time. 18