Page 33 - Bedford-FY22-23 Budget

have opened and expanded the sales tax base.

The overall expenditures in the model are re ective of the increase in the municipal cost index on an annual
basis. The average municipal cost index is adjusted and applied to all expenditure line items to present
forecasted results. The average of all expense line items, excluding payroll-related expenditures, are forecasted
to increase 1% per year.

The model identi es a certain percentage of the expenditure categories that are dedicated to personnel and
factors annual compensation increases towards personnel costs in order to project what the total cost would
be over the next ve years. The model includes a 7% step adjustment for Public Safety Sworn employees and a
5% cost of living adjustment for all eligible general employees.

The City's largest General Fund cost increases over the next several years will come from actions implemented
by City Council in FY 2021 to improve the TMRS Retirement Bene ts. City Council approved two signi cant
enhancements to the bene t:

Added a “Restricted Prior Service Credit” to employees who are members of the system for service
previously performed for various other public entities for which they have not received credited service.
Added an “Updated Service Credits” bene t on an annual basis for service performed by qualifying
members who, at the effective date of the allowance, are members of the City of Bedford.

Both enhancements resulted in an increase in the pension expenditure from 9.02% to 16.25% of salaries and
wages that started in FY 2021 and continue through all years in the model.

Overall, fund balance exceeds the City’s targeted levels of 20% every year of the forecast.

PROJECTIONS
The above chart shows the revenue and expense projections by major category for the next ve years,
beginning with the budget for FY 2022-2023. This chart was nalized based upon the decision of the City
Council regarding the tax rate for the current scal year and requested changes to the proposed budget.

Utility Systems
The City of Bedford maintains Water, Wastewater, and Stormwater Utility systems for its residents. These
systems require funding for daily operational expenses and capital investment to maintain the infrastructure.
As part of the budget process, City staff work with consultants to review the rates charged for these services to
ensure that revenue is suf cient. This requires evaluating the future capital needs and funding plans, including
future debt issuances, to plan for expected rate increases. During the budget discussion, the City Council
evaluates the recommendations for rate changes based on the report from staff and the consultants.

The attachments below are the presentations given to the City Council during the last two rate reviews. The
water and wastewater rates were reviewed and updated in FY 23 due primarily to the increase from the Trinity
River Authority in the cost for water purchase and wastewater treatment. The stormwater rate was reviewed,
but no changes were proposed. The presentation below was given to the City Council for the FY 22 budget
process and includes forecasts for the next few years.

City of Bedford, TX | Adopted Budget FY 2023 Page 33