Page 273 - Southlake FY20 Budget

Strategic Initiative Fund

Rating Agency Assessment and Perspectives

Recent reports from the City’s rating agencies complimented the City’s financial management.

S&P’s rating report notes:
“The rating reflects our view of the City’s:
• Very strong economy, with access to a broad and diverse metropolitan statistical area (MSA);
• Very strong management, with “strong” financial policies;
• Very strong budgetary performance, with operating surpluses in the general fund and at the total governmental
fund level;
• Very strong budget flexibility;
• Very strong liquidity;
• Weak debt and contingent liabilities; and
• Strong institutional framework score.”

Fitch reported:
“The city’s deliberate financial management has allowed it to maintain strong reserves, while cash funding capital
and street improvements despite moderate exposure to economically sensitive sales tax revenues. Dedicated funding
sources, including citizen-approved sales taxes, mitigate pressure on the budget and contribute to a moderately low
ad valorem tax rate.”

Current Considerations
The use of the SIF as a budget technique for future years depends on several factors:
• The City’s ability to meet its operational expenses with a structurally balanced budget for the current budget
year and in a multi-year context;
• The City’s ability to maintain a fund balance within policy parameters;
• The City’s capital needs and its ability to fund those in a timely manner to ensure infrastructure needs are
addressed appropriately; and,
• Tax rate management.
Technology
14.8%
Summary
The SIF is an innovative budgeting technique
that provides funding for one-time, high
impact projects. Since the City began using Capital Acquisition
the concept in 2006, almost 64% of the 11.8%
funds have been directed to the CIP for cash Facility Projects
funding of infrastructure needs. The fund CIP Transfer Facility Reserves 0.4%
has also been used for equipment purchases 63.9% 6.7%
and to build a facility maintenance reserve Urban Design/Master Plan
Support
fund, among other things. 0.9%
Public Art
0.1%
Community Enhancement
1.4%

Strategic Initiative Fund Expenditures by Type, FY 2006 - 2020

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