Page 109 - Honorable Mayor and Members of the City Council

6) The long-range financial forecast can help the general public understand the long-term costs associated with
current and proposed City activities and issues that may affect the municipal government of Benbrook.

PREPARATION OF THE CURRENT FORECAST

A forecast is only one of the many components in a financial planning system. The financial forecast does not attempt
to replace any of the other financial monitoring systems. The forecast also does not provide precise expenditure and
revenue projections over the term of the forecast. Due to the nature of economic and political systems, and the inability
of local or national officials to significantly influence the global economic and political system, the raw numbers this
forecast generates may easily become inaccurate even during the course of the next few days. The importance of the
forecast lies not in the mass of numbers produced but in the discussion it encourages and stimulates of both current
and future policies and practices.

This long-range financial forecast, as any other, contains many underlying assumptions. Each projection contains a
series of assumptions that may or may not hold true during the tenure of the forecast period. Each section details the
assumptions used in projecting revenues and expenditures and in some cases identifies policy changes that may cause
the assumptions to be incorrect.

FORECASTING METHODOLOGY

A wide variety of basic techniques are used by cities to forecast revenues and expenditures. The City of Benbrook uses
three basic techniques to forecast revenues: (1) expert judgment, (2) trend analysis, and (3) application of per capita
data to projected future increases. Expenditure forecasts are derived through the use of the same techniques and
methodologies.

REVENUE METHODOLOGY

The expert judgment of revenue forecasting, also known as the "best guess" approach, is used to project some revenue
sources. This method relies on a variety of experts on the City Staff as well as outside sources. The Staff considers
different viewpoints to provide a "middle of the road" approach in projecting most of the City's revenue sources. A
variety of opinions are solicited to lessen the possibility of skewing or slanting the approach toward either overly
optimistic or pessimistic conclusions.

CITY OF BENBROOK 2018-19 ANNUAL BUDGET
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