Page 61 - Honorable Mayor and Members of the City Council

BASIC FINANCIAL GOALS

Due to Benbrook's dependence on property taxes as the primary source of General Fund and Debt Service Fund
revenue, the City has not been as adversely affected by the slowdown of the economy as experienced by many Texas
municipalities since September 2001. In fact, Benbrook has proven to be an exception to this trend. In 2010 a Wal-Mart
opened in Benbrook and is serving as an anchor to secure new commercial development. Benbrook initially
experienced an increase in sales tax revenue from Wal-Mart and other businesses. However, a slight decrease in sales
tax revenue occurred from 2012 through 2016 as a result of the closing of other retailers within Benbrook. This project
resulted in a reduction in the number of shoppers along this corridor due to the inconveniences created by the
construction. With the completion of this project in 2017-18, Benbrook’s revenue from sales tax is projected to increase.

In years past, Benbrook was vulnerable to a loss of residential property tax revenue. In March 2004, the City Council
approved an ordinance establishing an ad valorem tax limitation on residential homesteads of the disabled and
persons sixty-five years of age or older and their spouses, as authorized and defined by the Texas Constitution, Article
VII, Section 1-b and Texas Tax Code Section 11.261. When the over-sixty-five limitation was enacted, Benbrook’s
property tax exemptions for senior citizens increased, but not as exponentially as projected.

Over the past years, the City Council exercised caution in determining the annual property tax rate. The decline of the
housing market that impacted portions of the United States is not yet evident in Benbrook. The home foreclosure rate
in Benbrook has been well below national, state, and local trends. The 2018-19 Budget reflects the maintenance of the
property tax rate at the 2017-18 rate of $0.6400 per $100 valuation. The City’s tax rate is still at a level to generate
sufficient property tax revenue should these economically-negative trends invade Benbrook in the near future.

The 2018-19 Budget insures that Operating Fund reserves are maintained at a minimum of $8,000,000. The 2018-19
Budget is designed to finance basic operating services at a high-level of service to Benbrook’s residents and to retain
dedicated and valued employees. The Budget includes limited capital purchases, new programs, and enhancements.

The 2018-19 Budget continues implementation of the City's financial policies and goals. The 2018-19 Budget is a
balanced budget in that no funds have to be borrowed to provide the proposed level of services. The 2018-19 Budget
includes the anticipated utilization of the City's unrestricted reserves. The projected year ending fund balance for the
General Fund and Debt Service Fund in the amount of $8,404,938 is more than adequate to provide for any normal
emergency. The projected reserves at year-end are sufficient to maintain the City's current bond ratings by both
Moody's Municipal Services and Standards and Poor’s Investor Service.

CITY OF BENBROOK 2018-19 ANNUAL BUDGET
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