Page 23 - Hurst FY19 Approved Budget

Valley View Branch sewer line. Water and sewer revenues will support the
an-nual debt service obligations for this project.

The city’s FY 2018-2019 debt service obligations have a marginal decrease of less
than $1,000 when compared to FY 2017-2018. Debt service will edge up slightly
over the next few years until a decrease in debt service occurs in 2022. The drop in
debt service will likely be utilized to support future debt issues. The ladder truck
funded in 2017 was structured with maximum flexibility to allow the city to retire
the debt early without penalty. As the city works through our debt management
program, additional debt is anticipated in order to maintain our high quality
roads and facilities, including funds for a much needed animal services center.
The city has been in the planning stages for these projects for over two years. The
city recently completed a full engineering study of our roadways and developed
a capital improvement plan based upon its results. City Council and staff have
also spent considerable effort evaluating various sites and developing schematic
designs for a new animal services and adoption center with the possibility of co-
locating a dog park. The Council anticipates holding a bond election in May 2019
for the animal services and adoption center.

Community Services Half-Cent Sales Tax Fund

The Community Services Half-Cent Sales Tax Fund historically has seen large
variances from year to year based upon debt funded projects and other pay-
as-you go capital and infrastructure maintenance programs. The number and
scope of pay-go projects varies from year-to-year, which typically creates large
“budget swings” within this fund. A detailed listing of pay-as-you go projects
can be found in the other funds section of this document. This fund maintains
a reserve to overcome losses in sales tax revenue. Unlike the General Fund, this
fund relies primarily on sales tax revenue. Other revenue sources such as grants
and investment income are unable to stabilize the market driven swings in sales
tax revenue.

The adopted budget for the Community Services Half-Cent Sales Tax Fund includes
the previously discussed 2.5% salary adjustment and routine replacement of
equipment for the parks and recreation divisions. In addition to typical operational
and maintenance costs, this fund will also support investments in the Smith
Barfield Park, Green Ribbon Grant program, and tennis center renovations in FY
2018-2019. Total capital outlays for 2018-2019 are budgeted at $1,007,674

New debt is only issued as current debt is paid off and pay-as-you-go programming
is scaled back. As such, debt funded projects and debt capacity will continue to
be closely monitored as sales tax revenue growth continues to at a slower pace
than in recent years. Sales tax revenue is conservatively budgeted to remain flat

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