Page 136 - City of Watauga FY22 Adopted Budget

BUDGET-OVERVIEW

department that handles that expense item. This was a reallocation and had no overall
impact on the budget. A City Attorney division was created this year and related
expenses were moved from non-departmental for transparency purposes.

There will be a utilization of fund balance in the amount of $125,525 for this year and the
projected ending fund balance for FY2021-2022 is $6,050,871, which equates to 41% of
operating expenditures in reserves. This is above the minimum target policy of twenty-
five percent (25%) by an amount of $2,381,502.

General Fund Debt Service Fund

As discussed in the General Fund section above, the City bases its ad valorem tax rate
on the certified appraisal roll provided by the Tarrant Appraisal District (TAD). A combined
tax rate is adopted each year by the City Council that funds 1) the use and support of the
general fund (maintenance and operations rate) and 2) to finance the City’s Debt Service
Fund (referred to as Interest and Sinking, or I&S rate) for payment of annual principal and
interest due on outstanding general indebtedness. This is the portion obligated for debt
service payments and is projected on payments as specified in debt obligations. The
fund receives a transfer-in from the Economic Development Corporation for their payment
of various economic development and parks projects within the City.

The City has existing long-term debt issued for the construction of capital facilities,
infrastructure, and vehicles and equipment. The debt service requirement for principal
and interest payments and fiscal agent charges for totals $3,143,658. This amount
includes debt service for the 2021 Certificates of Obligation debt issuance for projects
included in the General Capital Project Fund and listed below. The ending fund balance
is projected to be $703,556.

General Capital Projects Fund

The General Capital Projects Fund provides the basic resource for general government
projects such as streets, parks, public facilities, equipment, and other infrastructure
needs. Many of these projects are funded from debt issuance proceeds and the
remaining are funded by a transfer in from the General Fund. Other revenues include
interest income on investments, and proceeds of the sale of surplus property.

The following projects will be funded this year:

✓ This year the sidewalk program will be funded at $100,000.
✓ Engineering costs have been funded at $25,000 in anticipation of additional needs
throughout the City.
✓ Continuation of the Whitley Road street projects, parks projects are funded by the
2016, 2018, and 2020 Certificates of Obligation proceeds. These projects are
continued from prior years.

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