Page 60 - CityofGrapevineFY25AdoptedBudget

Key Expenditure Drivers and Assumptions

Personnel costs are based upon the assumption of full employment, with no addition of
permanent personnel during the next three years. The FY24 budget included market and merit
increases for general and public safety employees and the addition of seven FTEs which led to
$2.1 million (3%) in increased personnel expenses from FY23 to FY24. In future year, expenses
are expected to increase 4% each year.

Supplies, Maintenance, and Services are projected to increase at a rate of 3-5% per year. Costs
increased 11% between FY24 and FY25.

Capital / Street Maintenance costs are derived from the five-year plan submitted by the
facilities, parks maintenance, streets and traffic divisions. The plan consists of a detailed
program of activities for each piece of capital infrastructure within the city.

Insurance costs include property and casualty coverage as well as employee medical, dental,
vision and life insurance coverage which increased 33% between F23 and FY24. Insurance costs
are highly volatile and an increase between 3-5% is expected.

Debt Service costs will vary, as it is dependent upon several factors. As debt has been
restructured to take advantage of lower interest rates, the amount of property tax required to
support debt obligations (the I&S portion of the tax rate) will fall correspondingly as existing
debt is paid off. As the I&S portion of the debt rate decreases, the ability to generate additional
revenue for the General fund (the M&O portion of the tax rate) is limited due to rollback
provisions. Projections assume the city will maintain the tax rate at the current level of
$0.241165 or the No New Revenue Rate.

Transfers out include payments to the Capital Equipment Replacement fund for the acquisition
of new and/or replacement capital equipment, vehicles, heavy machinery, and technology items.
Transfers out also include funds earmarked for the Quality of Life CIP (QOL) fund and Crime
Control & Prevention District (CCPD) fund. The FY25 budget has a total of $20 million in cash
transfers.

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