Page 245 - City of Colleyville FY22 Adopted Budget

Hotel Occupancy Tax Fund 5-Year Forecast

HOTEL TAX FUND SUMMARY

BUDGET PROJECTED PROJECTED PROJECTED PROJECTED PROJECTED PROJECTED
FY 2021 FY 2021 FY 2022 FY 2023 FY 2024 FY 2025 FY 2026
BEGINNING FUND BALANCE - 10/1 399,005 399,005 172,984 177,662 181,361 186,539 192,763
FUND REVENUES
Hotel Taxes 235,000 100,000 250,000 255,000 265,000 275,000 285,000
Earned Interest 2,500 300 2,500 2,500 2,500 2,500 2,501
TOTAL REVENUES 237,500 100,300 252,500 257,500 267,500 277,500 287,501
FUND EXPENDITURES
Promotional Events/Arts Promotion 35,000 35,000 47,000 47,000 47,000 47,000 47,000
Colleyville Promotion/Advertising 82,592 83,196 96,499 100,063 104,419 109,013 112,239
Colleyville Center 209,584 208,126 104,323 106,738 110,903 115,263 118,291
TOTAL EXPENDITURES 327,176 326,321 247,822 253,801 262,322 271,276 277,529

ENDING FUND BALANCE - 9/30 309,329 172,984 177,662 181,361 186,539 192,763 202,734

The five-year forecast (shown above) was prepared and presented to the City Council to
guide decision making during the budget process and ensure that long-term implications
are considered. Shifting operating costs away from the General Fund and into the Hotel
Occupancy Tax Fund played a major part in maintaining the City’s low tax rate for FY
2021 and FY 2022.
Economic restrictions brought on by COVID-19 drastically affected revenues, as hotel
bookings throughout the spring and summer months waned. Staff anticipated the fund
earning less than half of its budgeted FY 2021 revenue, followed by a relatively quick
turnaround once COVID-related travel restrictions eased. This appears to be in process,
as the last two quarters’ worth of revenue have shown sharp increases, as has the month
of October 2021. Staff predicts a return to normal for FY22, with the remainder of the
forecast conservatively projecting 2% to 4% increases annually.

Costs in the Hotel Tax Fund for FY 2022 include personnel expenses dedicated to
marketing the City, non-recurring improvements at the City’s event center, marketing
materials, and special event funding. With hotel tax revenue having accumulated over
the past several years, staff is planning on drawing down this fund’s balance on eligible
projects as they arise. The fund is operationally balanced with revenues being sufficient
to support the ongoing operational costs contained here.

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