Page 72 - Ord 866 Adopting a revised Fiscal Year 17-18 and new proposed Fiscal Year 18-19 budget

Section 2 Financial Analysis
Budget 101 Overview

The Visitors Association Fund receives its primary funding from a 7% hotel occupancy
tax adopted by the Town of Westlake in FY 1999/ 2000. Proceeds from the hotel
occupancy tax are required to be used in accordance with statutory parameters
including the promotion of travel and tourism in the Town of Westlake. Additionally,
because Westlake has broader statutory authority under State law than most cities to
spend hotel/ motel occupancy tax funds for any municipal purpose, the Town has used
these funds to cover costs of various municipal operational costs and capital projects
an example would be payment of a portion of the debt service for Westlake
Academy related bonds).

The Public Improvement District Fund (Local) accounts for monies received from bond
proceeds, inspection fees and payments related to the Solana Public Improvement
District. The District was created by ordinance in February 2014 to finance the
construction of public infrastructure ( such as water lines and streets) in the Entrada
subdivision. Revenues deposited into the PID Fund are used to cover engineering,
consulting, legal, and advertising costs attributable to Entrada development and
construction.

The Lone Star Public Facilities Corporation was founded in 1996 and was designed “ to
provide for the acquisition, construction, rehabilitation, repair, equipping, furnishing
and placement in service of public facilities in an orderly, planned manner and at the
lowest possible borrowing costs.” The idea was to “acquire, through the issuance of
installment sale obligations, office buildings located within the State of Texas but
outside the boundaries of Westlake, whose tenants will be limited to those entities
which are qualifying tenants under applicable federal income tax law so that the
interest payable with respect to the installment sale obligations will be exempt from
federal income taxation.” There has been no activity in the fund for several years.

The 4B Economic Development Corporation Fund is a local option established under
the Texas local government code. 4B funds are generated from a ½ cent sales tax
levy and proceeds are used for debt service.

The Economic Development Fund was set up to maintain all receipts and
disbursements of agreements between the Town and various corporations for
economic development. There was confusion regarding the additional revenues
being recorded in the General Fund and offset by expenditures. These balances offset
to zero but skewed the analysis of each. This fund is used to create more transparency
to the public regarding these receipts and payments.

4. DEBT SERVICE FUNDS
These funds were established to account for, and the payment of, general long-term debt
principal and interest. This fund provides a clearer accounting of ongoing debt obligations
compared to operating budgets. The Debt Service Fund is used to make scheduled
payments for all bond issuances.

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