Page 44 - Mansfieldr FY20 Approved Budget

Service Fund, sales tax for the MPFDC and MEDC Debt Service Funds, and user fees for the Water &
Sewer Fund and Drainage and Environmental Services Fund.

Capital Projects Funds

The Capital Projects Funds account for the financial resources to be used for the acquisition of capital
facilities other than those recorded in Proprietary Funds. The Capital Projects Funds are used to account
for the acquisitions of capital facilities financed from general obligation bond proceeds or certificate of
obligation proceeds, or transfers from other funds. The City's Capital Projects Funds consist of the
following funds: Street Improvements, Utility Improvements, Drainage Improvements, Building
Construction, MPFDC Construction, MEDC Construction, and Equipment Replacement.

TIRZ (Tax Increment Reinvestment Zone)

The Tax Increment Reinvestment Zone is a specific fund designated to capture the tax increment in a
defined geographic zone. The tax increment is to pay for the public improvements specific to the zone or
area defined by ordinance. Any increase in value or property value increment may be used to pay for the
debt for these public improvements or be used to reimburse the developer for the public improvements
paid for by the developer on behalf of the City.

PROPRIETARY FUND TYPES:

Enterprise Funds

The Enterprise Funds are used to account for operations that are financed and operated in a manner
similar to private business enterprises where the costs (expenses, including depreciation) of providing
goods or services to the general public on a continuing basis are financed through user charges. The
City's Enterprise Funds are the Water & Sewer Fund, Environmental Services Fund and the Law
Enforcement Center Fund. These funds are accounted for on a full accrual basis of accounting.

BUDGET CONTROL

As set forth in the City Charter, the City Council adopts an annual budget prepared in accordance with
Generally Accepted Accounting Principles. The City Manager may transfer part or all of any
unencumbered appropriation balance among programs within a department. The City Council may
require their approval of these transfers if the transfers exceed the adopted budget for each fund.

All unused appropriations, except appropriations for capital expenditures, lapse at the close of the fiscal
year to the extent they have not been expended or encumbered. An appropriation for a capital
expenditure shall continue in force until the purpose for which it was made has been accomplished or
abandoned. The purpose of any such appropriation shall be deemed abandoned if three years pass without
any disbursement from or encumbrance of the appropriation.

BASIS OF ACCOUNTING

The accounting and financial reporting treatment applied to a fund is determined by its measurement
focus. All governmental funds are accounted for using a current financial resources measurement focus.
All proprietary funds are accounted for on a flow of economic resources measurement focus utilizing a
Modified Accrual basis of accounting.

44