Page 56 - Southlake FY24 Budget

What follows is an explanation of the funds themselves and how they contribute to the overall budget.

General Fund.
The City’s principal operating fund, which is supported by taxes, fees, and other revenues that may be
used for any lawful purpose. This fund accounts for all activity not specifically accounted for in other
funds. It includes such operations as police, fire, engineering, planning, finance and administration. It
is City policy to maintain an undesignated fund balance (reserves) for emergencies or unforeseen
circumstances equivalent to 15-25% of planned expenses.

Strategic Initiative Fund.
This fund was created in 2006 for the purpose of taking General Fund balance reserves in excess of the
City identified optimal fund balance level and using them for one-time expenditures for high-impact
projects such as infrastructure maintenance, community enhancement, technology and capital acquisition.
Budget Overview
Economic Development Investment Fund.
The Southlake 2035 Economic Development & Tourism Strategic Plan includes the following as
recommendation 4.3: “Southlake should establish a fund to use to attract and retain employers, as well as
to help retain and expand existing businesses.” This fund was created in 2013 for that purpose and its use
is governed by a City Council-proposed policy.

Facility Maintenance Reserve.
The purpose of this fund is to build capacity for future maintenance projects as we will have many
needs to address as our facilities age. The Strategic Initiative Fund (SIF) has provided regular transfers
for this fund, an important element of our budget given the size and complexity of the City’s facility
infrastructure. For the upcoming fiscal year, we will continue our practice of transferring SIF money into
this fund, but we are also budgeting expenses in the operating budget for facility projects.

Technology Infrastructure & Security Fund.
The Technology Infrastructure & Security Fund was created in 2017 to build capacity for current and
future technology needs. Expenditures in this fund are used to maintain, enhance and replace technology
infrastructure and enterprise software to ensure the City receives the most reliable and best value with
technology investments. In order to keep up with the increasing number and complexity of security
threats, this fund also supports technology security projects and programs.

Utility Fund.
The Utility Fund is an enterprise or business fund. This means that the direct beneficiaries of the
“business” pay for all costs through fees or rates. Water, sewer service, and solid waste service revenues
generated through our rates, as well as the expenses for providing these services are accounted for in
the Utility Fund. As with the General Fund, prudent financial management and bond requirements make
it necessary to have healthy reserves. Rather than stating the reserves as a percentage of operating
expenses, it is stated as days of working capital. It is our goal to have no less than 60 to 90 days of
working capital on hand.

Vehicle Replacement Fund.
This fund accounts for the resources needed to manage the purchase of vehicles for the City’s fleet. The
establishment and funding of the vehicle replacement program was designed to even out expenses for
the City’s fleet from year to year and provide a logical method for purchasing and retiring vehicles.

56 FY 2024 City of Southlake | Budget Book