Page 295 - Southlake FY22 Budget

STrATEGIC InITIATIVE FUnD

City to move forward with capital projects without compromising the City’s fund balance, raising taxes, or increasing
the City’s debt load.
The City’s budget is sustainable and healthy, and able to withstand the effects of unforeseeable economic impacts.
This is due, in part, to the City’s use of innovative financial practices, such as the SIF.

raTing agenCy assessmenT and PersPeCTives
Recent reports from the City’s rating agencies complimented the City’s financial management.

S&P’s rating report notes:
“The rating reflects our view of the City’s:
• Very strong economy, with access to a broad and diverse metropolitan statistical area (MSA);
• Very strong management, with “strong” financial policies;
• Very strong budgetary performance, with operating surpluses in the general fund and at the total governmental
fund level;
• Very strong budget flexibility;
• Very strong liquidity;
• Weak debt and contingent liabilities; and
• Strong institutional framework score.”

Fitch reported:
“The city’s deliberate financial management has allowed it to maintain strong reserves, while cash funding capital
and street improvements despite moderate exposure to economically sensitive sales tax revenues. Dedicated funding
sources, including citizen-approved sales taxes, mitigate pressure on the budget and contribute to a moderately low
ad valorem tax rate.”

TECHNOLOGY
CurrenT COnsideraTiOns 13.9%
The use of the SIF as a budget technique for
future years depends on several factors:
• The City’s ability to meet its operational CAPITAL ACQUISITION
expenses with a structurally balanced 10.3%
FACILITY PROJECTS
budget for the current budget year and 0.3%
in a multi-year context; CIP TRANSFER FACILITY RESERVES
• The City’s ability to maintain a fund 61.1% 10.8%
balance within policy parameters;
• The City’s capital needs and its ability URBAN DESIGN/MASTER PLAN
SUPPORT
to fund those in a timely manner 1.1%
to ensure infrastructure needs are PUBLIC ART
0.1%
addressed appropriately; and,
COMMUNITY ENHANCEMENT
• Tax rate management. 2.4%

summary sTraTegiC iniTiaTive fund exPendiTures By TyPe, fy 2006 - 2022
The SIF is an innovative budgeting technique that provides funding for one-time, high impact projects. Since the
City began using the concept in 2006, more than 61% of the funds have been directed to the CIP for cash funding
of infrastructure needs. The fund has also been used for equipment purchases and to build a facility maintenance
reserve fund, among other things.

294 FY 2022 City of Southlake | BUDGET BOOK
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