Page 63 - Southlake FY24 Budget

City Revenues and Resources

The City relies on many sources of revenues and the strategic use of reserves to fund services to the
community at a stable and sustainable level. The largest revenue categories are ad valorem (property) and
sales taxes, followed by franchise fees, charges for services, and usage fees.

Taxes
Taxes, both property and sales, imposed by a government for the purpose of raising revenue to support
governmental activities, are distinct from fees in that a tax does not need to be levied in proportion to the Budget Overview
specific benefit received by a person or property. The majority of the City’s tax revenues are received by
the General Fund, the primary general purpose fund of the City. Taxes account for nearly 86% of revenues
in the General Fund supporting many of the City’s most essential services such as police, fire, road
maintenance, library and parks. In addition to funding the General Fund, a portion of the sales tax goes to
funding the Crime Control Prevention District, Southlake Parks Development Corporation, and Community
Enhancement Development Corporation as allowed by state law. More about each of these funds can be
found in the Special Revenue Fund section of this book.

Fees
Service fees are another source of the revenue for the City. A diverse set of fees are charged to recover all
or a portion of the City’s costs for providing a service or access to public property, or for mitigating the
impacts of the fee payer’s activities on the community. Intended for cost recovery, a fee may not exceed
the estimated reasonable cost of providing the service or facility for which the fee is charged. Due to this
requirement and legal restrictions related to their expenditure, many of the City’s fees are accounted for
in separate funds. By far, the largest source of fee revenue comes from the provision of water, wastewater
and solid waste collection services. Other significant service fees include development related fees
and impact fees. Impact fees are especially volatile as they are driven by specific requirements from
development to mitigate the impact of new development on city infrastructure. As they are paid and
received by developments, they express volatility. This is not a year over year issue, however, as they are
restricted to the construction of new facilities or renovation and upgrade of existing facilities and not used
for ongoing expenditures.

OTHER REVENUE SOURCES
Figure 6 WATER SALES-COMMERCIAL - 3.8%
FRANCHISE FEES - 2.1%
All funds - INTEREST INCOME - 2.0%
SANITATION SALES - 1.9%
Revenue by HOTEL TAX - 1.5%
PERMITS/FEES - 1.1%
Source MISCELLANEOUS - 0.7%
SALES TAX FINES - 0.6%
STORM WATER-RESIDENTIAL - 0.6%
27.8% STORM WATER-COMMERCIAL - 0.5%
OTHER UTILITY CHARGES - 0.2%
RENTAL INCOME - 0.1%

WASTE WATER SALES
8.8%

TIF DISTRICT
6.7%
AD VALOREM TAXES
23.9% WATER SALES-RESIDENTIAL
13.3%

FY 2024 City of Southlake | Budget Book 63