Page 56 - Southlake FY20 Budget

Budget 101

Multi-year Planning
Multiyear planning is a key component of Southlake’s financial principles (see
Figure 1 at right). In fact, without proper planning in this area, the remaining
financial principles would be unattainable. To ensure multiyear sustainability, Financial Principles
Structural Balance
the Southlake City Council worked with staff to adopt a Sustainability Plan as
an element of the Southlake 2030 Comprehensive Plan. This element includes Taxpayer Relief
a section related to “Economic/Fiscal Wellness” that identifies three priorities
(Figure 2 below; also see Appendix to read plan).
Strong Net Revenues
With these priorities in mind, the City approaches multiyear planning from Optimum Fund Balances
two perspectives: revenue and expenditures. First, as it relates to revenue,
effective economic analysis is essential to accurate forecasting. Various data Limited Expenditure
on local economic information is used when projecting revenues for the
budget. This data includes economic indicators such as interest rates, wages, Growth
health care costs, consumer spending, and housing and commercial growth.
The data gathered from these sources are “shocked” to develop best, medium Multiyear Sustainability
and worst-case financial scenarios for stronger current budget decisions.
AAA Bond Rating

On the expenditures side, the operational impact of projects and programs have Maintenance
been identified and incorporated into the budget and a multi-year analysis has
been completed to confirm the sustainability of the budget over time. The City Cash Funding / Strategic
also utilizes a financial trend monitoring system that focuses on key financial Management of Debt
health indicators that are not only reviewed as a part of the budget process but
are also used to determine if budget decisions positively or negatively affect the Figure 1: Financial Principles
City’s financial position. One of the goals for the budget is to anticipate and
make deliberate decisions to reach financial and service goals. These trends are
graphed and provided as a part of this budget’s support materials to provide a
deeper understanding of the City’s overall financial condition. To read more, see
the City Profile section.

Southlake 2030 Sustainability Plan - Economic/Fiscal Wellness Priorities

EFW1: Apply sound financial
policies to the City’s budget by
maintaining structural balance, EFW2: Apply debt management EFW3: Fund and adopt annual
strong reserves, conservative strategies to the City’s City operating budget, capital
budgeting, effective economic budgeting projects and equipment
analysis and understanding the through sound financial
true cost of doing business policies

Figure 2: Economic / Fiscal Wellness Priorities identified in the Southlake 2030 Sustainability Plan

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