Page 8 - City of Arlington FY19 Adopted Operating Budget

Manager’s Message

INTRODUCTION

We are fortunate to live in a state, and specifically the DFW metroplex, that continues to grow and prosper economically. The
housing market and business investment remain strong and unemployment is at an all-time low. Growth is obvious throughout
the City. Cranes dot our cityscape, reminding us how much investment energy there is in the city. Economic Development will
remain a priority in order to capitalize on development throughout the region.

Arlington once again saw growth in assessed valuation, resulting in a modest tax rate reduction in FY 2019 – the third year in a
row with a lowered tax rate.

The highest priority for the City is the delivery of core services. Managed savings, restructuring, and ongoing efficiency initiatives
have enabled staff to deliver the same high level of service at the lowest possible cost. In FY 2019, we will see savings as a
result of a reorganization that I have recently implemented. The reorganization allows two departments vital to the successful
growth of our city, Public Works and Transportation and Community Development and Planning, to focus on their core business.
Enterprise functions, such as asset management and strategic initiatives, once housed within their departments have been
broken out and report directly to the new Assistant City Manager of Shared Services.

Another core service area of significant investment in the FY 2019 Budget is public safety. The Police Department is adding 13
new positions, 8 police officers, 1 police sergeant, and 4 civilian investigators. Four of the police officers and a sergeant are to
enhance the AISD School Resource Officer program and another two police officers are for additional security at our recently
opened Downtown Library and Central Plaza. We are extremely proud of our new facilities and want to ensure they’re safe for
all to enjoy. The final three police officers are the result of the culmination of the 2015 COPS Grant, which offset the initial costs
of adding officers to our ranks. The Fire Department is also adding three new positions, one per each shift, to increase staffing
at Station 17. Other public safety investments include funding for several police technology enhancements and for the planned
replacement of heavy fire apparatus.

For the past two fiscal years, employee compensation has been an area of significant investment; in FY 2019 it remains a
priority. FY 2019 is the 3 year of implementation of a three-year plan to bring employee salaries in line with the market,
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ensuring we are able to hire and retain the most qualified and skilled workers. The total General Fund investment in employee
compensation is $4.7million, $4 million for pay raises and a 4% increase in health insurance costs for both the City and the
employee. Health insurance cost increases are mitigated by plan changes that include the addition of a tobacco surcharge, an
increase in deductibles, and moving from Compass to the United Healthcare Consumer Tool to assist employees in navigating
their healthcare decisions.

Arlington is able to reinvest in priority services, while still reducing the tax rate because we provide an elevated level of service
at the lowest cost possible. Each year, staff makes efforts to reengineer, innovate, and manage savings to meet the challenge
of closing the structural gap between revenues and expenditures. One area of savings in FY 2019 is the realization of the final
three months of the lower electricity rates negotiated in 2016; $689,000 in savings budgeted city-wide. Another area of savings
are adjustments made to our health insurance plans resulting in $932,000. Maximizing the usage of volunteers where possible
and the successful application/award of grant funding is just another way stretch our resources.

We are continuously looking for new ways to innovate, to save, and to provide the highest value to our residents. The table on
the next page shows positions added and eliminated from the FY 2019 Adopted Budget.

2019 Adopted Budget and Business Plan iii City of Arlington, Texas