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Financial Policies

The City of Colleyville's {nancial policies are designed to establish and maintain effective long- term management of the
City's {nancial resources. These policies aim to ensure a sound {nancial condition, preser ve the City ’s creditwor thiness,
and balance the needs of the community with their ability to pay. Below is a summary of the key {nancial policies that
guide Colleyville’s {nancial management:

Summary of Financial Policies

Maintain a Balanced Budget: The City adopts a balanced budget each year, where current resources (revenues and
appropriated reser ves) equal or exceed budgeted expenditures. Long- term debt is not used to {nance current
operations, and non-recurring resources are used only for non-recurring expenditures.
Prudent Tax Rate Management: The City seeks to set the lowest tax rate possible while ensuring that it continues to
provide the high level of ser vice residents expect . A tax rate increase will only be requested when necessary, and will
not be pursued if it is not needed.
Budgetary Control and Financial Repor ting: The City exercises strong budgetary control with monthly repor ts
provided to the City Council, comparing budget versus actual performance, prior year actuals, and total annual
actuals.
Rate Stability and User Fees: The City seeks to avoid signi{cant increases in taxes and user fees by anticipating and
phasing in any necessary changes. User fees are charged to cover the cost of ser vices where appropriate, reducing
the reliance on proper ty taxes.
Maintain Adequate Reser ves: The City maintains reser ves equivalent to three months of operating expenditures for
the General Fund and Utility Fund. These reser ves provide a buffer for unforeseen contingencies and future capital
needs.
Debt Management: Debt is issued only when necessary and is structured to ensure that repayments do not exceed
the useful life of the {nanced assets. The City adheres to a pay-as-you- go philosophy where feasible, with long- term
debt reser ved for major capital projects.
Capital Planning and Investment: The City utilizes a rolling 5-year Capital Improvement Plan (CIP) to guide capital
acquisitions and improvements. Projects are prioritized based on their community impact , strategic alignment , and
risk management considerations.
Accounting and Auditing: The City follows GA AP and GASB principles, undergoes annual audits by an independent
CPA {rm, and maintains internal controls to safeguard assets and ensure {nancial accuracy.

Balanced Budget

The City ensures a balanced budget for all funds subject to appropriation, with current revenues and reser ves meeting
budgeted expenditures. Long- term debt is never used to {nance operating expenses, and non-recurring revenues are
allocated exclusively to one - time expenditures to maintain {nancial sustainability.

Tax Rate

Colleyville aims to set the lowest tax rate possible while maintaining high- quality ser vices. Tax rate increases are
considered only when necessary to sustain ser vice levels. This {scally responsible approach ensures careful stewardship of
taxpayer funds.

Annual Budget and Budgetary Control

The City prepares an annual budget , detailing sources and uses of funds, with public hearings for transparency. Monthly
{nancial repor ts compare budgeted versus actual performance, prior year results, and total annual actuals, ensuring close
monitoring. Year- end surpluses not required for reser ves are allocated to capital projects to meet long- term infrastructure
goals.

FY 2025-2026 Annual Budget | Colleyville Page 25