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2025 Sustainability PlanCity Council Winter Workshop – January 30, 2025 Economic & Fiscal Wellness Element Update Sustainability Master Plan Background Integrates Sustainability Aspects into City Policy Protects and Enhances Quality of Life for Residents Helps Promote Responsible Financial Management Considerations for Policy Refinement Review & Update Fiscal Sustainability Goals & Objectives Policy Considerations Review & Update Financial Management Principals Review & Update Implementati on Metrics Ensure Financial Sustainability Goals tie into 2035 VGO and updated SMS Staff Level Evaluation and Citywide Expenditure Analysis Data Point Considerations Tax Base Evaluation & Sales Tax Analysis by Sector and Business Capital Expense Analysis (CIP, Equipment, etc.) Debt Capacity & Fund Balance Preservation Analysis Slowing Revenue Growth State Legislation Project Demand Labor Market Sustainability Plan Policy Update: Data Analysis 10 years back 20 years forward Revenue •Property Values •Sales Taxes •Other Funds •Charges for Service Infrastructure •Maintenance & Repair •Replacement •New projects Service Demands •Customer Needs •Service Levels •Compensation & Benefits Debt Service •Funding Type •Capacity Revenue Analysis Comprehensive Analysis: •Property Values •Sales tax •Population •CPI Trends •Inflation - 2,000,000,000 4,000,000,000 6,000,000,000 8,000,000,000 10,000,000,000 12,000,000,000 14,000,000,000 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 Property Taxable Value (Residential/Commercial) Residential Taxable Value Commercial (Non-residential) 0 200 400 600 800 1,000 1,200 1,400 1,600 1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019 2021 2023 2025 2027 2029RESIDENTS PER SQUARE MILE Infrastructure Analysis Mobility Parks Water Wastewater Stormwater 200+ MILES OF ROAD $655.5M IN GOV’T ASSETS CAMERAS SOFTWARE MAINT. STORAGE CYBER SECURITY 100+ MILES OF STORMWATER INFRASTRUCTURE 880,000 SQ FT OF FACILITIES STREETS INFRASTRUCTURE TECHNOLOGY STORMWATER FACILITIES Infrastructure Analysis Infrastructure Analysis Comprehensive Analysis: •Value of Physical assets •Age of development with trend of aging infrastructure • Replacement schedules - 50,000,000 100,000,000 150,000,000 200,000,000 250,000,000 300,000,000 Mobility (Roads and Pathways) Park Improvements Facilities Public Art Water System Wastewater System DrainageInfrastructure Value Service Level Demands Analysis - 10,000,000 20,000,000 30,000,000 40,000,000 50,000,000 60,000,000 Personnel Expenditures - 1,000,000 2,000,000 3,000,000 4,000,000 5,000,000 6,000,000 7,000,000 8,000,000 Medical Insurance Expenditures Comprehensive Analysis: •Compensation Philosophy •Benefits Philosophy •Service Industry CPI impact Debt Service Analysis Comprehensive Analysis: •Debt capacity with growth •Cash vs debt (Truth-in-Taxation) •Time value of money (2,000,000.00) (1,000,000.00) 0.00 1,000,000.00 2,000,000.00 3,000,000.00 4,000,000.00 5,000,000.00 6,000,000.00 7,000,000.00 8,000,000.00 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045 Existing Debt/Future Funding Capacity Annual Debt Service Debt Capacity P LAN D EVELOPMENT & P OLICY C ONSIDERATIONS Sustainability Plan Outline REVENUE GENERATION & DIVERSIFICATION EXPENDITURE MANAGEMENT & E FFICIENCY DEBT MANAGEMENT C APITAL IMPROVEMENT & INFRASTRUCTURE P LANNING RESERVE FUNDS & FINANCIAL RESERVES LONG-TERM FINANCIAL PLANNING & FORECASTING WORKFORCE AND COMPENSATION RISK MANAGEMENT Revenue Generation & Diversification EXISTING POLICIES / GUIDANCE POLICY CONSIDERATIONS Financial Guiding Principles Bond Rating – Strong Financial Management Criteria Tarrant Appraisal District Reappraisal Plan Cost Recovery Policy Diversification Strategies Alternative Funding Sources Sales Tax Uses & Future Scenarios Cost Recovery Model Performanc e Metrics Expenditure Management & Efficiency EXISTING POLICIES / GUIDANCE POLICY CONSIDERATIONS City Charter Statement of Financial Principles Financial Guiding Principles CPI Alignment Practice SIF Expenditure Guidelines Technology Fund Goals TIRZ Project & Financing Plan/TIRZ Expenditure Guidelines EDIF Expenditure Guidelines HOT Expenditure Guidelines Expenditure Management Growth Expenditure Alignment with Prioritization of Strategic Goals and Service Demands True Cost Program Analysis Enhanced Efficiency Through Technology & Innovation Investments Performance Metrics Debt Management EXISTING POLICIES / GUIDANCE POLICY CONSIDERATIONS City Charter Statement of Financial Principles Bond Rating – Strong Financial Management Criteria Financial Guiding Principles Enhanced Guidelines & Policy Statements Credit Rating Management Strategy Debt vs. Pay- As-You -Go Criteria Performance Metrics Capital Improvement & Infrastructure Planning EXISTING POLICIES / GUIDANCE POLICY CONSIDERATIONS City Charter Cash Funding Balanced with Debt – Financial Guiding Principles CIP Guiding Principles Southlake Comprehensive Plans Operating & Maintenance Replacement Schedules Asset & Infrastructure Management Goals Asset Lifecycle / Service Levels Technology as Infrastructure Class Maintenance & Replacement Policy Guidance Performance Metrics Reserve Funds & Financial Reserves EXISTING POLICIES / GUIDANCE POLICY CONSIDERATIONS City of Southlake Statement of Financial Principles City of Southlake Fund Balance Policy Strategic Initiative Fund Policy Vehicle Replacement Fund Reserve Goal Facility Maintenance Fund Reserve Goal Fiscal Resiliency Evaluation of Existing Thresholds and Guidelines Reserve Fund Goals Performance Metrics Long-Term Financial Planning & Forecasting EXISTING POLICIES / GUIDANCE POLICY CONSIDERATIONS City Charter City of Southlake Statement of Financial Principles Bond Rating – Strong Financial Management Criteria Financial Guiding Principles Multi-Year Forecast Establish Cadence for Updating Adopted Financial Plans New Expenditure Requests / Service Demands Resiliency Goals & “Warning” Trends Performance Metrics Workforce and Compensation EXISTING POLICIES / GUIDANCE POLICY CONSIDERATIONS City of Southlake Compensation Philosophy City of Southlake Strategy Goal – Employer of Choice Financial Guiding Principles TMRS - Contribution Rate and Amortization Benefits Philosophy TMRS Considerations Staffing Alignment to Prioritized Service Demands Performance Metrics Risk Management EXISTING POLICIES / GUIDANCE POLICY CONSIDERATIONS City Charter Audit Practices Fraud Prevention Strategies & Internal Controls Risk Environment Analysis Establishing Policy Guiding Cadence and Goals Mitigation Strategies Insurance Strategies Performance Metrics P LAN D EVELOPMENT S CHEDULE & M ILESTONES Plan Development FUTURE WORK SESSION DATE : TBD SUMMER WORKSHOP DISCUSSION ADOPTION: SEPTEMBER 2025