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to ask any questions or raise any concerns they may have with the proposed tax rate
and budget. After the public hearings, the Council may adopt the proposed budget with
or without amendment. The City Charter requires the budget ordinance to be adopted
in accordance with state law. The City strives to adopt the budget within a timeline that
complies with state law and the City’s charter. The Council normally adopts the tax
rate ordinance at the same meeting as the budget ordinance.

THE BUDGET AMENDMENT PROCESS

The budget is normally reviewed in April and May of each year in order to determine if
revenues and expenditures are in line with original projections. In the event revenues
are below projections or expenditures appear to be exceeding projections due to
unforeseen events, then the budget may be amended. The City Charter provides for
amending the budget and altering appropriations.

A public hearing is held and the budget is amended by ordinance presented to the City
Council. A majority of the Council must approve the amendment ordinance. After
approval, the ordinance becomes an amendment to the original budget.

BUDGETARY BASIS OF ACCOUNTING

Budgets of general governmental fund types are prepared on a modified accrual basis.
Under the modified accrual basis of accounting, revenues are recognized when they are
measurable (the amount of revenue can be determined) and available (collectable
within the current period). Expenditures are recorded when they are incurred. The
following funds are governmental type funds and their budgets are prepared on that
basis: General Fund, Debt Service Fund, Capital Projects Fund, Crime Control and
Prevention District Fund, Street Maintenance Fund, Court Security Fund, Court
Technology Fund, Hotel/Motel Tax Fund, Municipal Development District Fund, and the
Cable PEG Fee Capital Projects Fund.

The enterprise funds are prepared on a full accrual basis. Under the full accrual basis
of accounting, revenues are recorded when earned and expenses are recorded at the
time they are incurred. The following funds are based on full accrual: Utility Fund,
Utility Capital Projects Fund, Golf Course Fund and Stormwater Utility Fund.

City of Azle FY 2022-2023 Budget 21