Page 262 - ArlingtonFY24AdoptedBudget

Appendices

FINANCIAL POLICIES (CONTINUED)

2. The funding status of all self-insurance funds will be reported annually.

In Compliance: Yes Comments: Included in most recent Annual Comprehensive Financial Report footnotes.

3. Full-time employee retirement funds will be administered by Texas Municipal Retirement System (TMRS). Contributions
will be made, at a minimum, in the amount determined by TMRS.

In Compliance: Yes Comments: Reviewed at least annually; contributions updated in system for most recent fiscal
year based on TMRS correspondence.

Fund Balance and Reserves

1. The City will maintain general fund reserves equivalent to 15% of recurring annual general fund expenditures. Reserves
will be calculated and presented as combined, with the source footnoted.

In Compliance: Yes Comments: For FY 2023, the City’s reserves total 20.0% of recurring General Fund expenditures,
which is $14.9 million in excess of the 15% requirement.

2. The Business Continuity Reserve for budget stabilization shall be maintained to provide financial stability for the General
Fund during an economic downturn, separate from General Fund reserves.

In Compliance: Yes Comments: The current balance Business Continuity Reserve is $4,062,075.

3. The City will maintain reserves in the Water Utilities Fund, Storm Water Utility Fund and Street Maintenance Fund equal to
a minimum of 60 days of operating and maintenance expenses (excluding debt).

In Compliance: Yes Comments: For FY 2023, the Water Utilities Fund’s reserves will total 60 days of operating and
maintenance expenses (excluding debt and capital purchases). Operating reserves in the Street
Maintenance Fund and Storm Water Utility fund will also represent 60 days of expenses in those
funds excluding debt and one-time expenses.

4. The City will maintain a Rate Stabilization Fund to assist in offsetting temporary increases to the budget and increases from
mid-year settle-ups from Trinity River Authority (TRA) and Tarrant Regional Water District (TRWD). The fund shall not
exceed 5% of the total Water Utilities expenditure budget. Use of this Fund will be authorized as part of the annual operating
budget.

In Compliance: Yes Comments: For FY 2023, the Rate Stabilization Fund balance will be 5% of the total Water Utilities
expenditure budget.

5. The City’s general fund unassigned ending balance may only be used for one-time purchases like capital equipment.

In Compliance: Yes Comments: Prior year balance in the amount of $891,361 was used in the FY 2023 budget for
one-time purchases.

6. All governmental and proprietary funds will have positive cash balances.

In Compliance: Yes Comments: All funds reported positive cash balances as of 9/30/22.

FY 2024 Adopted Budget and Business Plan 253 City of Arlington, Texas