Page 464 - Microsoft Word - FY 2021 tax info sheet

GLOSSARY OF TERMS
ENCUMBRANCE. An obligation, usually in the FUND. A fiscal and accounting entity
form of a purchase order, contract, or salary established to record receipt and disbursement of
commitment, related to uncompleted contracts income from sources set aside to support specific
for goods or services. Used in budgeting, activities or to attain certain objectives. Each
encumbrances are not classified as expenditures fund is treated as a distinct fiscal entity where
or liabilities, but are shown as a reservation of assets equal liabilities plus fund balances.
fund balance. Upon payment, encumbrances are
recorded as expenditure and liquidated, thereby FUND BALANCE. Unless stated otherwise, the
releasing the reservation of fund balance. excess of a fund's current assets over its current
Outstanding or unliquidated encumbrances at liabilities; sometimes called working capital in
year-end are re-appropriated into the budget of enterprise funds. Negative fund balances are
the subsequent year. referred to as a deficit.

ENTERPRISE FUND. A fund established to −G−
account for operations that are financed and
operated in a manner similar to private business GENERAL FUND. The fund used to account for
enterprises, where the intent of the governing financial resources except those funds required
body is that the costs of providing goods or to be accounted for in another fund; the general
services to the general public on a continuing fund is tax supported and includes the operations
basis be financed or recovered primarily through of most City services, i.e., police, fire, streets,
user charges. parks and recreation, and administration.

ESTIMATED BUDGET. The City's estimated GENERAL OBLIGATION DEBT. Money owed
financial plan, using mid-year estimates, on interest and principal to holders of the City's
containing both the estimated revenues to be general obligation bonds. The debt is supported
received during the year and the proposed by revenues provided from real property that is
expenditures to be incurred to achieve stated assessed through the taxation power of the City.
objectives. The City uses the current year esti-
mate during the budget process in order to GOAL. A broad, general statement of each
determine the estimated beginning fund balances department's or division’s desired social or
for the next year. (Sometimes called Revised organizational outcomes.
Budget.)

EXPENDITURE. The outflow of funds paid or to −H−
be paid for assets obtained or goods and services
obtained regardless of when the expense is HOMESTEAD EXEMPTION. The exemption will
actually paid. An expenditure decreases fund remove part of the home's value from taxation for
balance. the home owner if it is their principal residence.
The percentage of exemption is considered by
−F− Council on an annual basis.

FISCAL YEAR. The time period designated by −I−
the City signifying the beginning and ending
period for the recording of financial transactions. IMPACT FEE. A fee imposed by the City on new
The City's fiscal year is October 1 through development. Impact fees are collected for
September 30. roadway, water and sewer improvements. Impact
fees may only be used for capital improvements
FRANCHISE FEES (TAXES). A fee (tax) paid by and/or expansion to the systems for which the
a public utility for the use of public property in impact fee originally was collected.
providing their services to the citizens of Keller.
The fee is typically calculated as a percentage of INFRASTRUCTURE. That portion of a City's
the utility's gross receipts. assets located at or below ground level, including
streets, water, and sewer systems.
FULL-TIME EQUIVALENT (FTE) POSITION. A
position for an employee working a 40-hour work
week for 52 weeks a year, i.e., 2,080 annual
hours (2,912 annual hours for firefighters).

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