Page 63 - FY 2020-21 Budget Cover.pub

This planned drawdown on General Fund reserves will result in a reduction in the unreserved
fund balance of approximately 25.1%. However, the reduction is not expected to have a
significant impact on General Fund operations as the unreserved fund balance will remain
above the City’s stated goal of an unreserved fund balance equal to four (4) months of operating
expenditures. After all expenditures and transfers, the FY 2019-20 General Fund ending
unreserved fund balance is projected to be $4,707,056 or 34.7% of annual General Fund
expenditures.

OTHER ITEMS OF INTEREST

During the budget workshop for the FY 2019-20 budget, Staff was directed by the City Council
to prepare the FY 2020-21 budget with the assumption of adopting the de minimis rate.
Therefore, the tax rate proposed in the City Manager’s recommended budget was the de
minimis rate of $0.677788. This proposed rate was also the maximum rate the City Council
could adopt without triggering an election for voter approval. However, because of the
economic difficulties some of the City’s residents and businesses are experiencing as a result of
the COVID-19 pandemic, both the City Council and Staff hoped to adopt a rate less than the
rate originally proposed. After careful consideration of the City’s finances, it was determined
that readopting the lower 2019 tax rate of $0.657204 would produce revenue sufficient to fund
the coming year’s operations.

City of Azle 2020-2021 Budget 52