Page 12 - Saginaw FY20 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 City of Saginaw has also developed a long range financial plan to set parameters for
operating budgets and plan for a bond election. The plan extends to 2033. Key assumptions
include: the tax base will grow by 2% annually, the population will grow by 525 per year, the tax
rate will remain the same with 40% for Debt Service Fund and 60% for the General Fund. Given
these assumptions, the City has a capacity to issue approximately $40 million in new debt and
maintain funding for 6.8 full time equivalent positions per capita each year.

In connection with the Comprehensive Master Plan and the Multi-year Financial Plan, the City
has adopted a Strategic Plan with the following goals for the next five years.

 Maintain a financially sound city providing superior services
 Improve mobility and traffic flow
 More beautiful, livable community
 Develop vibrant activity centers/major corridors
 Expand community quality of life amenities

The annual budget is developed within the context of these three plans. These plans anticipate
funding needs and available revenues and forecast methods for matching future revenues and
expenditures. General Fund balance at the end of FY2019/2020 is projected to be $9.3 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 and an
economic development agreement, leaving $1.4million in unrestricted/unreserved resources.

The City continues to emerge from the economic downturn that was associated with the
national economic recession. There continues to be growth in the tax base and sales tax
revenues are expected to increase by 2% next year. High demand and a tight housing inventory
throughout the State of Texas has resulted in an increase of 15% in property tax values for the
City of Saginaw in 2019. 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.

The following pages present the City’s goals, achievements and objectives within the framework
of the strategies developed through the City’s planning, described above. Departmental goals,
achievements, and objectives and how those relate to the overall City long range and strategic
planning are included with each department’s budget.

12