Page 27 - Southlake FY23 Budget

TRAnSmITTAL LETTER

Expenditure highlights.

Personnel. The Utility Fund includes resources needed to manage and operate the City’s utility system. As noted in
the General Fund section of this letter, the budget proposes compensation increases and provides funding for benefit
cost increases. Additionally, the budget provides the resources needed to implement a Public Works Department
reorganization plan, designed to improve efficiency and promote stronger performance.

Other highlights. Funding has been requested for equipment and facility improvements. A few highlights of
supplemental requests for the Utility Fund are shown in the table and are specifically related to providing water,
sewer, and/or garbage service.

Total expenditures in the Utility Fund are proposed at $27,437,191, a 3.4% increase from the FY 2022 adopted
budget.

Indirect charge/transfers. We have budgeted a transfer of $1,365,808 from the Utility Fund to the General Fund to
cover indirect expenses and for payment of a franchise fee. A transfer of $9,755,000 to the Capital Improvements
Program is also budgeted.

Fund balance. The FY 2023 Utility Fund budget provides 159 days of working capital, or $11,940,428. This exceeds
the City’s fund balance policy, which states that the “…goal shall be to maintain a fund balance of 60 days of working
capital in the Utility Fund…with the optimum goal of 90 days of working capital.” This reserve fund will support
anticipated infrastructure maintenance and replacement for aging significant, high-value assets.

Most of the items included in the FY 2023 Proposed Utility Fund Budget address the
focus area of Infrastructure.

Vehicle replAcement Fund
Vehicle Replacement Fund expenditure highlights
highlight item expenditure
The Vehicle Replacement Fund accounts for the Fleet replacement
resources needed to manage the purchase of vehicles Equipment per schedule $4,957,000*
and heavy equipment for the City’s fleet.
*Includes FY 2022 vehicles that have not been received due to supply chain issues and have
been re-budgeted.
Revenue and transfer highlights. For FY 2023, we are
estimating revenue of $118,000 and a transfer of $3,000,000
from the General Fund to the Vehicle Replacement Fund southlAke 2030
sustAinABilitY
Expenditure highlights. Expenditures are estimated at
$4,957,000 to replace aging vehicles and heavy equipment mAster plAn
coming off-line. NOTE: Supply chain issues have affected
the city’s ability to acquire vehicles on a timely schedule. As
such, many vehicles slated for replacement during FY 2022
have not been received. Funds have been re-budgeted as EFW3: Fund and adopt annual City
needed to ensure availability of dollars as we are able to operating budget, capital projects and
receive the vehicles. equipment through sound financial policies.
“The Vehicle Replacement Fund should
Fund balance. The projected ending fund balance is
$6,344,763 which provides adequate reserves for the maintain three years of reserves as
program. identified in the replacement schedule.”

The FY 2023 budget proposes a transfer
from the General Fund of $3,000,000
towards this goal.
26 FY 2023 City of Southlake | BUDGET BOOK
WWW.CITYOFSOUTHLAKE.COM