Page 12 - Saginaw FY19 Annual Budget

The City of Saginaw prepared for the growth projected in the 1990’s by constructing
infrastructure to meet the demand. As the City approaches build-out, the new plan focuses on
strengthening the infrastructure system and maintaining and rehabilitating existing
infrastructure. Because the City of Saginaw is a mature city with a stable political and financial
base, Council is able to prepare formal long range financial plans every five years with a review
of priorities on an annual basis that is translated into the annual budget by Staff. Each year the
planned projects are evaluated based on the projected needs and available funding.

The annual budget is developed within the context of the long-range plans adopted by
Council. These plans anticipate funding needs and available revenues and forecast methods
for matching future revenues and expenditures. Due to conservative planning on the part of
the City Council and Staff, the City has been able to absorb the impact of economic swings.
The City of Saginaw was fiscally conservative during the economic expansion from 1990 to 2005.
Fund balances built up during the economic expansion have been available for one time
expenditures during the economic downturn. One time expenditures include capital projects,
capital purchases and special requests that are not of a recurring nature. The City funded the
reconstruction of City Hall and park improvements using cash fund balance. General Fund
balance at the end of FY2018/2019 is projected to be $8.7 million. Ending fund balance includes
restricted resources, 25% of operating expenditures, and reserved resources for the possible
increased cost of the Bailey Boswell Overpass project, leaving $2.7 million in
unrestricted/unreserved resources. A long range financial forecast, along with the associated
assumptions, is included in the Policies, Resolutions, & Ordinances section of this budget
document. City Management is currently working on a more detailed long range financial plan
in preparation for a possible bond election in 2019.

The City continues to emerge from the economic downturn that was associated with the
national economic recession. There has been some growth in economic activity with sales tax
revenues expected to increase by 1% this next year and increase slowly over the next five years.
High demand and a tight housing inventory throughout the State of Texas has resulted in an
increase of over 12.9% in property tax values for the City of Saginaw in 2018. For the purposes
of calculating property tax revenue the State of Texas has limited the taxable valuation increase
on residential property to 10% per year. Residential building continues with 200 new home starts
projected in the coming year.

In connection with the Comprehensive Master Plan, the City has adopted the following
strategies to meet the challenges for the next five years.

 Maintain service and staffing levels
 Seek alternative sources of funding and use inter-local agreements to increase levels of
service or cost savings
 Maintain adequate reserve funds to operate the City in case of financial emergency
 Maintain and upgrade the City’s infrastructure to assure quality services

The following pages present the City’s goals, achievements and objectives within the framework
of the strategies developed through the City’s long range planning. Departmental goals,
achievements, and objectives and how those relate to the overall City long range planning are
included with each department’s budget. City Management is in the process of revising the
City’s Strategic Plan which will influence future year’s goals and objectives and action plans.
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