Page 71 - Watauga FY21 Budget

BUDGET OVERVIEW

The City’s calendar for preparing and adopting the FY2020-2021 Budget follows this
Budget Overview section.

FINANCIAL POLICY GUIDELINES

These policy statements were prepared to provide a framework for fiscal decision-
making to ensure that financial resources are available to meet the present and future
needs of the citizens of Watauga.

The benefits of a financial policy are:

ƒ Improve and expedite the decision-making process by allowing elected officials
and staff to consider approaches to financial management from a long-term
perspective.

ƒ Enhanced credibility with the public, investors, and bond-rating agencies.
ƒ Provide a sense of continuity as changes occur among elected officials and
staff.
x Provide a means for dealing with fiscal emergencies.

Financial policies should be reviewed periodically (at least annually) by the City Council
and revised and updated as necessary.

The following are the fiscal objectives of this policy:

x Revenues: Design, maintain, and administer revenues that will ensure reliable,
equitable, and sufficient amounts to support desired services.
¾ Balance and Diversify Revenue Sources: Maintain a balanced and diversified
revenue system to avoid adverse fluctuations in any one source due to
changes in economic conditions.
¾ Property Tax Revenues: Strive to reduce reliance on property tax revenues
by implementation of user fees, economic development, and revenue
diversification.

¾ User fees: Establish and collect fees to recover the costs for services that
benefit specific users. When feasible, the City shall recover full direct and
indirect costs. These fees should be reviewed on a regular basis to calculate
full-cost recovery levels, compare them with current structures, and
recommend adjustments when necessary.
¾ Utility/Enterprise Fund Service Fees: Utility rates shall be set at sufficient
levels to recover operating expenditures, meet debt obligations, provide
funding for capital improvements, and provide an adequate level of working
capital. The City should seek to eliminate all forms of subsidization to utility
funds from the General Fund.

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