AND BUSINESS PLAN OVERVIEW City Value Proposition FY 2019 Proposed - - PowerPoint PPT Presentation

2019 PROPOSED BUDGET AND BUSINESS PLAN

City of Arlington, Texas

OVERVIEW

• City Value Proposition
• FY 2019 Proposed Budget
• FY 2019 Priorities and Core Services
• August 14th Meeting
• Budget Calendar

BUDGET DEVELOPMENT PROCESS

• Comprehensive Financial Forecast
• Department reviews with CMO
• All items considered included in Budget

Document (Other Budget Information)

• Reconciliation of Positions (adds, deletes,

reorganizations)

BUDGET STRATEGY

• Balanced and in accordance with City’s

Financial Principles

• Advance Priorities while maintaining Core

Services

• Addresses employee compensation

(three-year plan)& insurance adjustments

• Distribute Oversight and Workload
• Maintain Favorable Tax Policy

FY 2019 BUDGET

• Targeted investments in new technology

& public safety

• Tax rate of $0.6348, a half-cent reduction

in the tax rate

• Electricity savings
• Strategic use of one-time funding
• Fee adjustments
• Capital expenses planned in CIP
• Volunteer program (124,000 Hours)
• Grants ($13.3M)

BEST PRACTICES

CITY CONTRIBUTIONS TO THE STATE

• Sales Tax Service Fee - $2.2M
• Court Fines - $3.8M
• Payments to Other Agencies - $796k
• Total = $6.8M
• 2.6 cents on tax rate

FIRE ISO & NFIP RATING

• Fire ISO 1 rating effective March 1, 2018
• 1% of US communities achieve ISO 1
• Rating used by most insurance companies to predict

risk when assessing premiums

• Rating upgrade means reduced costs for businesses
• Public Works achieved upgraded National Flood

Insurance Community Rating on May 1, 2018

• Upgrade based on capital improvement project

planning, building standards, infrastructure maintenance, storm water education & outreach

• Upgraded rating may provide average annual flood

insurance premium savings ranging from $83 to $217 depending location of the property to the floodplain

FAVORABLE TAX POLICY

General Homestead Over 65 Disabled Person Tax Ceiling for Over 65 Vet1 Vet2 Vet3 Vet4

Minimums and Maximums Authorized Up to 20% of appraised value, must be worth at least $5,000 At least $3,000; no max established At least $3,000; no max established

Local Officials Authorized or Not Authorized 5,000 7,500 10,000 12,000

Arlington 20% $60,000 $60,000 Authorized

5,000 7,500 10,000 12,000

Minimums and Maximums Authorized Arlington

Mandated Veteran Exemptions Local Option Exemptions Authorized Business Exemptions

RESIDENTIAL COMMERCIAL

Freeport Abatements

Authorized Authorized

Local Officials Authorized or Not Authorized Local Officials Authorized or Not Authorized

AMOUNT OF EXEMPTIONS

Current No Ceilings or Homestead Exemption

M&O 0.4428 0.3859 I&S 0.1920 0.1675 Total Tax Rate 0.6348 0.5534 0.0814 Total AV Value $25,753,273,388 $29,549,318,686 Exemption/Ceiling $3,796,045,298 Avg Taxable Home Value $140,455 Avg Appraised Home Value $181,444 Cost to Average Home Owner $891.61 $1,004.11

TAX BILL COMPARISON

Tax Rate Homestead Tax Bill El Paso 0.8034 0% 1,425.95 Mansfield 0.7100 0% 1,260.18 Mesquite 0.6870 0% 1,219.36 Fort Worth 0.8050 20% 1,143.04 Grand Prairie 0.6700 > 1% or $10,000 1,117.83 Richardson 0.6252 0% 1,109.67 Dallas 0.7804 20% 1,108.11 Corpus Christi 0.6063 10% 968.51 Lubbock 0.5380 0% 954.90 Arlington 0.6398 20% 908.46 Carrollton 0.5997 20% 851.53 Irving 0.5941 20% 843.57 Austin 0.4448 > 8% or $5,000 726.32 Plano 0.4686 20% 665.37 Southlake 0.4620 20% 656.00 Grapevine 0.2892 20% 410.64 Using $177,490 as Average Home Value

TAX BILL COMPARISON

TAX BILL COMPARISON

TAX BILL COMPARISON

Exemptions 2017 Valuation 2018 Tax Bill House 1 None $121,121 $768.88 House 1 HS $121,121 $615.10 House 2 HS $124,267 $631.08 House 2 HS, OV65 – No Freeze $124,267 $250.20 House 2 HS, OV65 w/Freeze $124,267 $167.53

• Homeowner 1 Savings:
• HS – $153.78
• Homeowner 2 Savings:
• Over 65 Tax Freeze – $82.67
• Over 65 Exemption/Tax Freeze – $463.55

CITY COMPARISONS

OTHER CITY COMPARISONS

$47 $49 $55 $60 $60 $78 $85 $88 $99 $103 $135 $140 $146 $157 $244

$- $50 $100 $150 $200 $250

Mesquite El Paso Lubbock Fort Worth Arlington Corpus Christi Mansfield Dallas Carrollton Irving Richardson Plano Austin Grapevine Southlake

FY 2018 Assessed Value per Capita (in $1,000's)

Average: $103 63.5 66.3 77.9 78.5 80.7 80.8 82.7 91.0 92.0 97.3 98.5 115.7 137.5 138.2 146.9

• 20

40 60 80 100 120 140 160

Carrollton Arlington Mesquite Mansfield Irving Fort Worth Plano El Paso Lubbock Corpus Christi Richardson Dallas Grapevine Southlake Austin

FY 2018 Employees per 10,000 Citizens

Average: 96.5

Populations: 2018 Survey of Texas Cities

OTHER CITY COMPARISONS

$584 $621 $735 $754 $777 $797 $819 $836 $972 $991 $1,076 $1,086 $1,227 $1,299 $1,312

$- $200 $400 $600 $800 $1,000 $1,200 $1,400

El Paso Arlington Corpus Christi Carrollton Fort Worth Mesquite Mansfield Lubbock Dallas Irving Austin Plano Richardson Southlake Grapevine

FY 2018 General Fund Expenditures per Capita

Average: $926 $298 $323 $382 $397 $455 $476 $481 $596 $603 $614 $649 $654 $689 $842 $1,127 $0 $200 $400 $600 $800 $1,000 $1,200 Lubbock Mesquite Arlington El Paso Grapevine Corpus Christi Fort Worth Carrollton Mansfield Irving Austin Plano Dallas Richardson Southlake

FY 2018 Tax Levy Per Capita

Average: $572

OTHER CITY COMPARISONS

$0.2892 $0.4448 $0.4620 $0.4686 $0.5941 $0.8050 $0.5380 $0.6398 $0.6870 $0.7100 $0.6252 $0.6063 $0.7804 $0.5997 $0.8034 $- $0.20 $0.40 $0.60 $0.80 $1.00 Grapevine Austin Southlake Plano Lubbock Irving Carrollton Corpus Christi Richardson Arlington Mesquite Mansfield Dallas El Paso Fort Worth

FY 2018 Ad Valorem Tax Rates

General Fund Rate Debt Rate

Average: $0.6036

0% 0% 0% 0% 0% 1% 8% 10% 20% 20% 20% 20% 20% 20% 20% 20% 0% 5% 10% 15% 20% 25% El Paso Lubbock Mansfield Mesquite Richardson Grand Prairie Austin Corpus Christi Carrollton Dallas Fort Worth Grapevine Irving Plano Southlake Arlington

FY 2018 General Homestead Exemption

State Limit

Average: 11.2% Greater of 1% or $10,000 Greater of 8% or $5,000

OTHER CITY COMPARISONS, SWORN STAFF

PER 10,000 POPULATION

*Adopted Crime Tax

OTHER CITY COMPARISONS, SWORN STAFF

PER 10,000 POPULATION

0.92 1.04 1.08 1.09 1.19 1.19 1.22 1.29 1.38 1.43 1.52 1.53

• 0.5

1.0 1.5 2.0

Fire

OTHER CITY COMPARISONS,

STAFF PER 10,000 POPULATION

OTHER CITY COMPARISONS,

STAFF PER 10,000 POPULATION

OTHER CITY COMPARISONS,

STAFF PER 10,000 POPULATION

BUDGET AND BUSINESS PLAN HIGHLIGHTS

RESULTS

• Turnaround time for commercial

construction plans within 12 business days: 88% in FY 2017, 98% estimated for FY 2018

• Requests for pothole repair completed

within 3 working days of request: 93% in FY 2017, 95% estimated for FY 2018

• Participation in Parks programs and classes:

40,124 in FY 2017, 42,000 estimated for FY 2018

• Citizen satisfaction with overall library

services: 89% in FY 2017, 92% in FY 2018

PLANNED ITEMS FOR 2019 CIP DEBT ISSUANCE

• Fire Heavy Fleet replacement ($2,692,336)
• Tierra Verde HVAC ($750,000)
• Infrastructure Maintenance/City Facilities

($1,000,000)

• Playground Replacement Program ($1,140,000)
• River Legacy Parking lot renovations ($350,000)

Total: $5.9M

FY 2019 BUDGET

ALL FUNDS – OPERATING POSITIONS

CITY REVENUES BY FUND

CITY EXPENDITURES BY FUND

SUMMARY OF EXPENDITURE CHANGES

GENERAL FUND BUDGET BY DEPARTMENT

GENERAL FUND EXPENDITURES

GENERAL FUND POSITIONS

• 200

400 600 800 1,000 1,200 1,400

Police vs. Other General Fund Staffing FY 2001 - FY 2019

Police Other General Fund

GENERAL FUND REVENUE CHANGES

• Ad Valorem revenue increase of 9.3%
• Reduction in rate
• Increase in General Fund revenue of $9.1M in FY 2019

budget

• Anticipates September bill valuation change and
• ngoing impact of tax litigation settlements
• Sales Tax Revenue
• FY 2019 General Fund sales tax revenue is projected to

be $64.5M, which is $1.7M above the FY 2018 budget

• 3.1% growth over FY 2018 estimate
• Other Revenues
• Ballpark lease reallocate $750k (moved to one-time)
• Municipal Court down $575k
• Franchise Fees down $376k
• Interest income growth of $322k

GENERAL FUND REVENUES

PROPERTY TAX BASE

PROPERTY TAX RATES

SALES TAX REVENUE TRENDS

Through May, sales tax revenue in the General Fund is $419,483 (1.0%) under the weighted monthly budget amount for the year to date. Receipts are up from the prior year in eight of the last 12

• months. Through May, receipts

are 3.3% above what the City received last year.

8.0%

• 3.0%

6.5% 2.3%

• 0.6%

1.9% 9.8%

• 0.2%

0.1% 14.1% 3.1% 2.5%

• 0.8%
• 15%
• 10%
• 5%

0% 5% 10% 15% 20% May 17 June 17 July 17 Aug 17 Sept 17 Oct 17 Nov 17 Dec 17 Jan 18 Feb 18 Mar 18 Apr 18 May 18

Monthly Sales Tax Revenues Percent Change from Same Month in Prior Year

$4.6 $9.0 $15.5 $20.4 $24.5 $30.5 $35.9 $41.0 $46.9 $51.8 $56.8 $62.8 $4.5 $9.0 $15.3 $20.1 $24.5 $30.5 $35.6 $40.6

$0 $10 $20 $30 $40 $50 $60 $70

Oct Nov Dec Jan Feb Mar April May June July Aug Sept

FY 2018 Budget to Actual Comparison

In Millions

FY 2018 Budget FY 2018 Actual

• 1. The FY 2019 proposed revenue budget for the Court is $10.1 million, which is $3.94 million (28.1%) lower than the high point of $14.0 million in 2011.
• 2. If citations decline in 2019 by the same percentage as in 2018, the estimate for 2019 is 92,079 citations, which is 63,405 (40.8%) fewer citations

than the 155,484 citations filed in 2009.

60,000 80,000 100,000 120,000 140,000 160,000 180,000 FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 Estim. FY 2019 Prop.

Municipal Court Revenues and Citations FY 2006 - FY 2019 Proposed Budget

Revenues, in $ hundreds Citations

COMPENSATION & BENEFITS

COMPENSATION PLAN YEAR 3

Proposed compensation increase for all funds = $4.4M

Job Family Year 3 Increase Engineering 2.5% Information Technology 2.5% Admin/Clerical 2.5% Management Professional 2.5% Technical/Craft 2.5% Crime Scene 2.5% Job Family Year 3 Increase Police Officer 4.6% Police Sgt 5.7% Police LT 5.0% Firefighter 5.3% Fire LT 5.1% Fire Captain 4.3% Deputy Chief/Battalion Chief 4.3% Apparatus Operator 5.3% Fire Prevention 5.3% General Fund Total $3,996,400

SWORN STEP PLAN MAINTAINED

• Police - $442,000
• Fire - $620,000

Compensation Summary

Police & Fire FY 2019 Market Average Distance FY18 FY19 Police (all steps/ranks) 2.55% above 4.7% above Fire (all steps/ranks) 2.53% above 4.33% above Civilian Employees FY 2019 Market Average FY18 FY19 Civilian (all job families) 2% above 4% above

Health Insurance Highlights

• 4% Employee Rate Increase: (increase of $.53 - $6.96/pay period)
• HDHP $13.69 individual - $81.29 family
• EPO $30.44 individual - $180.34 family
• Retiree Subsidy: No Change
• Tobacco Use Surcharge: $25/pay period
• Annual Deductible Increase: $250 individual/$500 family
• Continue Wellness Program Participation Premium Differential

$20/pay period

• Terminate Compass contract; Promote UHC programs – myHealthcare

Cost Estimator, Nurseline, Check.Choose.Go

• Continued growth of Employee Health Center utilization
• First 4 months: 925 Visits, 293 Personal Health Assessments

TMRS

• Funded full $105,787 increase, not

phased in

• Rate increase from 15.94% to 15.96%
• Amortization Period from 19.6 years

to 18.6 years

• Increased funded ratio 86.6% to

87.2%

TMRS CONTRIBUTION RATES

TMRS NET PENSION LIABILITY

$97 $102 $113 $124 $221 $234 $247 $144 $132 $117 $161 $145 $147 $152 $153

$0 $50 $100 $150 $200 $250 $300 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

Net Pension Liability

(in $ millions)

OPEB

CIVIL SERVICE UPDATE

FY 2018 Personnel Budget $294,200 HR Civil Service Coordinator (11/6/17) Human Resource Assistant (11/20/17) Senior Attorney (2/26/18) Paralegal (2/26/18) FY 2018 Personnel Savings $68,030 FY 2018 Operating Expenses Budget $35,300 FY 2018 Operating Expenses Estimate $151,246 FY 2018 Projected Variance ($47,916)

COUNCIL PRIORITIES

RECURRING FUNDING SUMMARY GENERAL FUND

Category Amount Mandates & Contractual Increases $871K Compensation & Benefits $5.3M Public Safety $2.2M Priorities & Needs $365K IT Projects $514K Total $9.2M

DEFERRED/DECLINED REQUESTS

No. FTEs Amount General Fund Total 78 55 19,424,681 $ Other Funds Total 24 5 9,193,094 $ City Total 102 60 28,617,775 $ Requests

COUNCIL PRIORITIES – HIGHLIGHTS

Champion Great Neighborhoods

• Neighborhood Matching Grant Program

($150,000)

• Code Short Term Rental Enforcement

($112,952)

• Interstate Mowing ($100,200)
• Green Screen ($100,000 current year)
• Home Improvement Incentive Program

($84,000)

COUNCIL PRIORITIES – HIGHLIGHTS

Enhance Regional Mobility

• Transportation Services ($667,601)
• Autonomous Vehicle Program ($250,000)
• Street Maintenance Fund Balance ($3.8M)

COUNCIL PRIORITIES – HIGHLIGHTS

COUNCIL PRIORITIES – HIGHLIGHTS

Invest in Our Economy

• Hotel & Convention Center ($125,000)
• ACVB $870,000
• Convention and Event Services Investments

($950,000)

• Commercial Dishwasher
• Airwall Track Repair
• Internet Bandwidth and Wi-Fi System Upgrade
• Technology Maintenance & Upgrades
• Removable carpet, install labor & equipment
• Concession Equipment

COUNCIL PRIORITIES – HIGHLIGHTS

Put Technology to Work

• Software Maintenance ($130,000)
• Department Technology Projects ($1.3M)
• Police Digital Video Systems
• Laserfiche Upgrade
• Inspection Scheduling
• Ap.com Enhancements
• Police Staffing Solution
• Court Software Enhancements
• ERP System Assessment/Plan Development

($200,000)

• Video Magistration ($15,000)

COUNCIL PRIORITIES – HIGHLIGHTS

Support our Youth and Families

• AISD School Resource Officers ($84,762

net recurring plus vehicle)

• Restore Library Funding ($95,265)
• New Parks Development O&M

($122,895)

• Playground Equipment Replacement

($400,000)

• Reopen Texas Rangers Golf Couse

($508,504 in Park Performance Fund)

CORE SERVICES – HIGHLIGHTS

Public Safety

• COPS Grant Transition ($1.1 M)
• Fire Prevention Staffing ($104,141)
• Security Contract Increase ($61,106)
• Fire Utility Increases ($51,785)
• Civilian Investigators ($268,788)
• Fire Station 17 Staffing ($247,597)

CORE SERVICES – HIGHLIGHTS

Financial / Economic Development

• Property/Casualty Insurance

Premiums ($70,886)

• TAD/Tarrant County Increases

($98,086)

• Payroll Staff Accountant ($77,540)
• Janitorial Contract Increases

($201,709)

CORE SERVICES – HIGHLIGHTS

Infrastructure

• Storm Water Graduate Engineer

($105,731)

• Fleet Property Site Mitigation

($525,000)

OTHER FUNDS

CONVENTION & EVENT SERVICES PROGRAM CHANGES

• Revenues are $321k higher than FY 2018
• Hotel Occupancy Tax up $482K
• Convention Center Revenues down $161K
• FY 2019 Expenditures
• New Recurring Expenses $525K
• Funding for ACVB $400K
• Internet, WiFI & Technology Maintenance $125k
• One-time Expenses $1.295M
• ACVB $470,000
• Commercial Dishwasher $175k
• Airwall Track Repair $200k
• Internet Bandwidth upgrade $150k
• HVAC, Concession equipment, carpet $300,000

PARK PERFORMANCE FUND PROGRAM CHANGES

• Revenues are $509k higher than FY 2018
• Golf revenue is up $560k due to Texas Rangers Golf

Club re-opening

• Recreation and Field revenues are down $50,425

from FY 2018

• FY 2019 expenditures are $897k higher than FY 2018
• Golf expenditures are up $781k
• Recreation expenditures are up $113k
• Field expenditures are up $3,036
• Transfer in from Parks ATF until TRGC clubhouse fully
• perational - $1.8M

COMMUNICATION SERVICES PROGRAM CHANGES

• FY 2019 Revenues and Expenditures
• Mid-year compensation alignment impact on FY

2019 ($577k)

• 9-1-1 PBX ($100k) paid from beginning fund balance
• $1.73M of expenditures for CAD and radio

maintenance moved to this fund, paid from CES non-HOT revenues

IT SUPPORT FUND PROGRAM CHANGES

• One-time project expenses $779,910
• City Website Rebuild Phase II $43,400
• Network Intrusion Detection $100,000
• Supplementary Resources for Enterprise IT Projects

$156,510

• Enterprise IT Projects $435,000
• New Recurring expenses $518,700
• City Website Rebuild Phase II $33,700
• Network Intrusion Detection $100,000
• Software Maintenance $130,000
• Enterprise IT Projects $255,000

STORM WATER UTILITY FUND

STREET MAINTENANCE FUND

• Sales tax increase of almost $500k over

current year estimate

• $3.8M in additional contracted street

maintenance

WATER UTILITIES

WATER FIXED MONTHLY CHARGE

WATER CONSERVATION RATES RESIDENTIAL BLOCK STRUCTURE

COST OF SERVICE COMMERCIAL VOLUME RATE BLOCK STRUCTURE

WATER CONSERVATION RATES CONSTRUCTION METER RATES

SEWER FIXED MONTHLY CHARGE

COST OF SERVICE SEWER RATE

CUSTOMER IMPACT

RESIDENTIAL WATER RATES FOR 10,000 GALLONS

$36.66 $38.56 $38.98 $39.05 $41.51 $43.58 $43.60 $46.70 $47.01 $48.89 $50.67 $56.13 $57.50 $57.60 $58.10 $59.45 $64.40 $64.68 $69.73 $69.94 $82.34 $- $10 $20 $30 $40 $50 $60 $70 $80 $90 Arlington *Arlington… Carrollton Dallas Lewisville Irving Plano Fort Worth Frisco Mansfield Allen Euless Denton Bedford Cedar Hill McKinney Richardson Flower Mound Mesquite North Richland… Garland Source Data: Texas Town & City, May 2018 and City Websites

*Arlington’s proposed increase compared to other cities prior to their increase

COMMERCIAL WATER RATES FOR 50,000 GALLONS

*Arlington’s proposed increase compared to other cities prior to their increase

$154.73 $226.83 $229.61 $236.60 $245.18 $247.30 $273.37 $273.88 $274.00 $279.30 $283.98 $284.95 $286.34 $315.04 $326.53 $336.07 $350.00 $351.60 $353.30 $357.38 $385.27 $- $50 $100 $150 $200 $250 $300 $350 $400 $450

Carrollton Lewisville Allen Arlington Fort Worth *Arlington… Frisco Euless Denton Cedar Hill Irving McKinney Dallas Bedford Richardson Plano Garland Mansfield North Richland Hills Mesquite Flower Mound

Source Data: Texas Town & City, May 2018 and City Websites

FUNDING FOR RESERVES

SELECTED CITY RESERVES

OTHER POST WORKING BUSINESS LANDFILL EMPLOYMENT UNALLOCATED CAPITAL CONTINUITY LEASE BENEFITS Balance on October 1, 2017 7,219,801 $ 20,055,003 $ 4,062,075 $ 17,151,326 $ 1,717,904 $ Appropriated Amounts

• Transfers In / (Out)

382,131 1,061,471

• Balance on September 30, 2018

7,601,932 $ 21,116,474 $ 4,062,075 $ 17,151,326 $ 1,717,904 $ Appropriated Amounts

• Transfers In / (Out)
• Balance on September 30, 2019

7,601,932 $ 21,116,474 $ 4,062,075 $ 17,151,326 $ 1,717,904 $

SELECTED FINANCIAL RESERVES FY 2019 OPERATING POSITION

FY 2019 SUMMARY OF RESERVES

Working Capital, $21,116,474 Unallocated, $7,601,932 BCR, $4,062,075 OPEB, $1,717,904 Landfill, $17,151,326 $- $5,000,000 $10,000,000 $15,000,000 $20,000,000 $25,000,000 $30,000,000 $35,000,000 $40,000,000 $45,000,000 $50,000,000 $55,000,000

FY 2019 Reserves Summary

Not Required: $13.72m Required: $37.93m

RESERVE TRENDS

CHANGE IN AVERAGE HOME VALUE

BUDGET CALENDAR

• Special Budget Meeting – August 14
• Scheduled Council Meetings
• August 21 – first public hearing on the tax rate
• Town Hall meetings
• August 23, 6:30 S. Police Service Center
• August 30, 6:30pm Council Chambers City Hall
• Second public hearing on the tax rate
• September 4
• Budget Public Hearing
• First vote on budget and tax rate
• September 13
• Second vote on budget and tax rate

QUESTIONS?