Page 83 - Haltom City FY20 Approved Budget

City of Haltom City Annual Budget, FY 2020

Debt Service Fund

Legal Debt Limit for General Obligation Debt

All taxable property within the City is subject to the assessment, levy and collection by
the City of a continuing, direct annual ad valorem tax sufficient to provide for the payment
of principal and interest on City issued General Obligation Bonds. Article XI, Section 5,
of the Texas Constitution is applicable to the City, and limits the maximum ad valorem tax
rate to $2.50 per $100 of assessed valuation (for all City purposes). Self-supporting debt
that will be repaid by revenues generated through the ongoing activities of enterprise
funds or other non-governmental funds are not subject to a legal debt limit. Limits for self-
supporting debt are instead set by the ability of the issuing entity to pay, charter
limitations, profit and loss considerations or other governing body limitations.

The chart below displays the relationship of the City’s adopted total tax rate of $0.66576
in relation to the legal limit of $2.50. The City’s current tax rate is 26.6% of the legal limit.

Tax Rate Current Available
Limit Tax Rate Tax Rate
$2.50 $0.665 $1.835

The Debt Management Policy of the City limits the total annual tax-supported debt service
to no more than 25% of General Fund spending. The adopted debt service budget of
$6,192,254 includes $4,471,476 of debt supported by property taxes. The property tax
supported debt is the equivalent of 14% of General Fund expenditures, well within the
current policy. For FY2020, the debt services portion of the tax rate is at $0.25203.

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