Page 70 - Hurst Budget FY21

BUDGETARY
FINANCIAL POLICY GUIDELINES

Numerous financial policy guidelines are followed for the fiscal management of the City and enable the City to
maintain financial stability. They are reviewed annually. The policies are long standing and provide guidelines for
current decision-making processes and future plans. Some of the most significant guidelines pertaining to the
budget are as follows:

OPERATING BUDGET POLICIES

Balanced Budget

The Budget should be balanced with revenues being equal to or greater than current expenditures/expenses using
the following strategies in order of priority: improve productivity, shift the service or payment burden away from the
city, improve revenues, create new service fees or raise existing fees based on the cost of services, reduce or
eliminate programs, use fund balances, if available, increase property taxes, and lastly, reduce or eliminate
services.

The 2020-2021 budget was balanced primarily due to conservative expenditure budgeting combined with growth in
both property tax revenues. The following revenue sources are major contributors to balancing the budget and will
provide savings to the General Fund in associated expenses.

x Community Services Half Cent Sales Tax Fund will provide savings of $2,965,984
x Anti-Crime Half Cent Sales Tax Fund will provide a savings of $5,566,615

These sources are examples of a "service or payment burden being shifted away from the City" since an estimated
75% of the half percent sales tax revenues are collected from consumers who shop in Hurst but live outside the
City. Expenditures continue to be conservatively estimated with every dollar backed by written justification.

General and Administrative Charges

The General Fund is compensated by the Enterprise Fund, Fleet Service Fund, Anti-Crime Fund, Half Cent Sales
Tax Fund, Storm Water Management Fund, Hurst Conference Center Fund and Commercial Vehicle Inspection
Fund for the general and administrative services provided such as management, finance and personnel, as well as
the use of City streets by Enterprise Operations. The following intragovernmental revenue transfers for 2020-2021
are budgeted:

x Enterprise Fund will contribute $3,751,359
x Fleet Service Fund will contribute $246,376
x Community Services Half Cent Sales Tax Fund will contribute $345,560
x Anti-Crime Half Cent Sales Tax Fund will contribute $812,154
x Other Indirect costs will contribute $238,779

General Fund Reserves

The General Fund balance should be adequate to handle unexpected decreases in revenues plus a reasonable
level for extraordinary unbudgeted expenditures. The minimum fund balance should be 90 days computed
separately from designated components of the fund balance. A surplus typically exists in the General Fund each
year and is transferred to a Special Projects Capital Fund after 90 days fund balance allowance is considered.

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