Page 110 - City of Watauga FY22 Adopted Budget

BUDGET OVERVIEW

➢ 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.
➢ Administrative Service Charges: A method should be established to
determine the annual administrative service charges due the General Fund
from Enterprise Funds for overhead and staff support. The Enterprise Fund
shall pay the General Fund for direct services rendered when appropriate.
➢ Revenue Estimates for Budgeting: A conservative, objective, and analytical
approach shall be used when preparing revenue estimates. This should
include an analysis of probable economic changes, historical collection rates,
and trends in revenues. This should maintain a stable level of services and
reduce the probability of actual revenues being short of budget estimates.

➢ Revenue Collection: The revenue system should be as simple as possible in
order to expedite payments. Since revenue should exceed the cost of
producing it, administrative costs should be controlled and reduced as much
as possible. The City shall pursue, to the full extent allowed by law, all
delinquent taxpayers, and others overdue in their payments to the City.

• Expenditures: Prioritize services, establish appropriate levels of service, and
administer the resources to ensure that fiscal stability is attained and
maintained, and that services are delivered in an effective, efficient manner.
➢ Current Funding Basis: Expenditures shall be budgeted and controlled to not
exceed current revenues plus the planned use of fund balance accumulated
through prior year saving. (Use of fund balance is discussed in another
section).

➢ Operating Deficits: Take immediate corrective action if expenditures are
projected to be greater than projected revenues at year-end. Corrective
actions could include, but are not limited to, expenditure reductions, fee
increases, or use of fund balances. Short-term loans, use of one-time
revenue sources, or expenditure deferral to the following fiscal year should be
avoided.
➢ Capital Asset Maintenance: As resources are available each year, capital
assets and infrastructure should be maintained at sufficient levels to minimize
future replacement and repair costs, to continue prescribed service levels,
and to protect the City’s investment in the assets.

➢ Program Reviews: Make periodic staff and third-party reviews of programs to
ensure efficiency and effectiveness. Consider privatization and contracting
with other governmental agencies as alternative approaches for service
delivery. Eliminate programs that are determined to be inefficient or

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