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Processes and Policies

Water and Sewer 25.00%

Enterprise Funds: (Days Cash on Hand-Minimum)
Municipal Airport 100 Days
Municipal Parking 100 Days
Solid Waste 100 Days
Stormwater 100 Days
Water and Sewer 100 Days

Internal Service Funds: (Working Capital)
Capital Projects Service 10.00%
Fleet and Equipment Service 10.00%
Group Health Insurance 25.00%
Risk Financing 25.00%

When it is appropriate for fund balance to be assigned, the City Council delegates authority to the city manager.

Revenue
The City shall diversify its revenue sources to the extent possible to reduce reliance on property tax. Periodically,
the City will review specific programs and services that are identified to be potential areas for funding through
user fees. The City Council will determine the level of cost recovery for the program or service. For example, fire
inspection fees will be set at a level sufficient to recover the full cost of services and solid waste fees shall be set
at a level sufficient to recover the full cost of solid waste enterprise operations. Sound cash management practices
shall augment revenues available to the City.

Capital Improvements
The City adopts a five-year Capital Improvement Program (CIP) to be revised and approved annually. Currently,
the City appropriates all funds for capital projects with a capital budget ordinance per the City charter.

Debt Policies
The City debt policy establishes guidelines for debt financing that will provide needed capital equipment and
infrastructure improvements while minimizing the impact of debt payments on current revenues.

As a municipal government, the City issues both tax-exempt and taxable securities in the form of general
obligation and revenue bonds as part of its ongoing goal to create the most livable and best-managed city in the
country. The proceeds from these debt transactions are utilized to fund the City’s comprehensive Capital
Improvement Program for multiple sectors of its operation. It is considered best practice for the City, as part of
the issuance of tax-exempt obligations, to adopt written procedures outlining how the City will maintain
compliance with federal guidelines.

Debt Planning Guidelines

Debt financing, to include general obligation bonds, revenue bonds, certificates of obligation, certificates of
participation, commercial paper, tax notes, lease/purchase agreements, and other obligations permitted to be
issued or incurred under Texas law, shall only be used to purchase capital assets and equipment that cannot be
prudently acquired from either current revenues, assigned fund balance, or net position, and to fund

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