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Base Budget: Ongoing expense for personnel, contractual ser vices, and the replacement of supplies and equipment
required to maintain ser vice levels previously authorized by the City Council.

Basis of Accounting: The method used to determine when revenues and expenditures are recognized in the accounts
and repor ted in the {nancial statements. For example, the modi{ed accrual basis is used for governmental funds.

Betterments (Special Assessments): Whenever a speci{c area of a community receives bene{t from a public
improvement (e.g., water, sewer, sidewalk , etc .), special proper ty taxes may be assessed to reimburse the governmental
entity for all or par t of the costs it incurred. Each parcel receiving bene{t from the improvement is assessed for its
propor tionate share of the cost of such improvements. The propor tionate share may be paid in full or the proper ty owner
may request that the assessors appor tion the betterment over 20 years. Over the life of the betterment , one year ’s
appor tionment along with one year ’s committed interest computed from October 1 to October 1 is added to the tax bill
until the betterment has been paid.

Bond: A means to raise money through the issuance of debt . A bond issuer/borrower promises in writing to repay a
speci{ed sum of money, alternately referred to as face value, par value or bond principal, to the buyer of the bond on a
speci{ed future date (maturity date), together with periodic interest at a speci{ed rate. The term of a bond is always
greater than one year. (See Note)

Bond and Interest Record: (Bond Register) – The permanent and complete record maintained by a treasurer for each
bond issue. It shows the amount of interest and principal coming due each date and all other per tinent information
concerning the bond issue.

Bonds Authorized and Unissued: Balance of a bond authorization not yet sold. Upon completion or abandonment of a
project , any remaining balance of authorized and unissued bonds may not be used for other purposes, but must be
rescinded by the community's legislative body to be removed from the community's books.

Bond Issue: Generally, the sale of a cer tain number of bonds at one time by a governmental unit .

Bond Rating (Municipal): A credit rating assigned to a municipality to help investors assess the future ability, legal
obligation, and willingness of the municipality (bond issuer) to make timely debt ser vice payments. Stated other wise, a
rating helps prospective investors determine the level of risk associated with a given {xed-income investment . Rating
agencies, such as Moody's and Standard and Poors, use rating systems, which designate a letter or a combination of
letters and numerals where AAA is the highest rating and C 1 is a very low rating.

Budget: A plan for allocating resources to suppor t par ticular ser vices, purposes and functions over a speci{ed period of
time. (See Performance Budget , Program Budget)

Capital Assets: All real and tangible proper ty used in the operations of government , which is not easily conver ted into
cash, and has an initial useful live extending beyond a single {nancial repor ting period. Capital assets include land and
land improvements; infrastructure such as roads, bridges, water and sewer lines; easements; buildings and building
improvements; vehicles, machinery and equipment . Communities typically de{ne capital assets in terms of a minimum
useful life and a minimum initial cost . (See Fixed Assets)

Capital Budget: An appropriation or spending plan that uses borrowing or direct outlay for capital or {xed asset
improvements. Among other information, a capital budget should identify the method of {nancing each recommended
expenditure, i.e., tax levy or rates, and identify those items that were not recommended. (See Capital Assets, Fixed Assets)

Capital Expenditures: Capital expenditures refer to funds used by the City to acquire, maintain, or improve long- term
assets such as infrastructure, buildings, equipment , or vehicles. These expenditures typically involve signi{cant , one - time
outlays for items that have a useful life of {ve years or more and a minimum investment threshold (e.g., $50,000). Capital
expenditures are intended to create future bene{ts and are crucial for maintaining and enhancing the City's infrastructure
and operational capabilities. Examples include road improvements, facility construction, and major equipment purchases.

FY 2025-2026 Annual Budget | Colleyville Page 189