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Home My WebLink AboutBudget PresentationTown of Westlake Budget Retreat “Securing the Vision” August 20, 2010 Vision for Westlake: Comprehensive Plan “ The Vision for Westlake is to create a community which builds on its existing high quality office park development and rural residential character, and which maintains and enhances the natural features of the community.” 4/5/2013 Budget Retreat 2 Strategic Vision for Westlake - 2008 “Westlake is a one-of-a kind community; an oasis with rolling hills, grazing longhorns, and soaring red-tailed hawks, located in the heart of the Fort Worth-Dallas metropolitan area. Inviting neighborhoods and architecturally vibrant corporate campuses find harmony among our meandering roads and trails, lined with native oaks and stone walls. We are leaders. In education we are known for our innovative partnerships between the Town-Owned Charter School and its corporate neighbors. We are environmental stewards exemplifying the highest standards. Hospitality finds its home in Westlake. As a community, we are fully involved and invested in our rich heritage, dynamic present and exciting, sustainable future.” 4/5/2013 Budget Retreat 3 Survey Results Reflect Westlake’s Vision 4/5/2013 Budget Retreat 4 FY 2009 – 2010 Accomplishments 4/5/2013 Budget Retreat 5 Service Demands Daytime Population vs. Residents 4/5/2013 Budget Retreat 6 Five Year Financial Forecast General Fund 4/5/2013 Budget Retreat 7 Fund Description Estimated FY 09-10 Proposed FY 10-11 Estimated FY 11-12 Estimated FY 12-13 Estimated FY 13-14 Estimated FY 14-15 General Fund Beginning Fund Balance $ 2,675,310 $ 3,316,014 $ 2,198,686 $ 2,016,518 $ 513,190 $ (1,137,738) Total Revenues 4,785,244 2,890,765 2,939,988 2,990,688 3,042,908 3,096,695 Total Transfers In 90,000 18,000 1,145,399 19,096 19,669 20,259 Total Expenditures (4,113,749) (3,990,335) (4,110,045) (4,233,346) (4,360,347) (4,491,157) Total Transfers Out (120,790) (35,758) (157,510) (279,765) (353,158) (81,258) Net Total 3,316,014 2,198,686 2,016,518 513,190 (1,137,738) (2,593,199) Total Restricted Funds 194,540 197,800 197,800 197,800 197,800 197,800 Ending Balance (projected) $ 3,121,474 $ 2,000,886 $ 1,818,718 $ 315,390 $ (1,335,538) $(2,790,999) Operating Days 277 183 162 27 (112) (227) Property Tax Reduction Beginning Fund Balance $ 1,068,034 $ 1,266,324 $ 1,553,247 $ 239,007 $ (101,199) $ (469,052) Total Revenues 875,800 818,300 625,000 625,000 625,000 625,000 Total Transfers Out (677,510) (531,377) (1,939,240) (965,206) (992,853) (765,075) Ending Balance (projected) $ 1,266,324 $ 1,553,247 $ 239,007 $ (101,199) $ (469,052) $ (609,127) Challenge: Preserving the Past & Achieving Our Vision for the Future The current predicament: •Declining Projected Revenues –FY 08/09 Actual = $4M, FY 10/11 Estimated = $2.9M •Anticipated Expenditures Exceed Revenues –Expenditures In excess of $3.9M •Increasing Deficit = Declining Fund Balance –Estimated undesignated fund balance = $2M •Unfunded Liabilities –Capital Improvement Projects = Approx. $25M 4/5/2013 Budget Retreat 8 Challenge: Preserving the Past & Achieving Our Vision for the Future •How do these shortfalls impact our Vision? •What effect do they have on the strides we have made? •What possible consequence may they have on our goals & aims for the future? •How do we meet this challenge while maintaining our perspective? 4/5/2013 Budget Retreat 9 Key Questions The Logical Leap: Cut costs… Direction from Council’s 05/24 Retreat: –See What a 10% ATB Budget Reduction Looks Like –See What a 20% ATB Budget Reduction Looks Like –Balance the budget using the program priority basis 4/5/2013 Budget Retreat 10 10% ATB Base Budget Reduction Scenario (General Fund) Total Reductions = $397,421 –Staff Salaries Reduced by a Minimum of 5% –Loss of one Patrol Officer –Employee Recognition & Community Outreach programs reduced / eliminated (Christmas Parties, Meals at Council events, Recognition Awards etc.) –Court Dockets and hours shortened Deficit of Approximately $705,000 remaining 4/5/2013 Budget Retreat 11 20% ATB Base Budget Reduction Scenario (General Fund) Total Reductions = $794,845 –Staff Salaries Reduced by 5% to 15% –Hourly and part time positions reduced or eliminated –Travel, Training and Certifications for Town Staff eliminated –Routine Street and Facilities Maintenance reduced by 50% –Two Patrol Officers Cut Deficit of Approximately $309,000 remaining 4/5/2013 Budget Retreat 12 Prioritizing Spending Guiding Principles 2010 Direction Finder Survey 4/5/2013 Budget Retreat 13  Both surveys rank Safety, Education, and Infrastructure in the Top Four. Town Council Ranking $0 $1,000 $2,000 Arts & Culture Citizen Engagement Transportation Service Excellence &… Environmental Sustainability Active Lifestyles Economic Sustainability Community Development Infrastructure Education Financial Stewardship &… Safety $0 $76 $36 $436 $0 $96 $0 $0 $140 $572 $153 $2,291 Thousands Prioritizing Spending •Top 4 = $3.1M of the General Fund budget 1.Public Safety = $2.3M •Public Safety (Fire/EMS) = $1.2M •Public Safety (Police) = $754k •Public Safety (Court) = $382k 2.Westlake Academy = $572k 3.Financial Stewardship = $153k 4.Infrastructure = $140k •All other programs combined equal less than $650k •A balanced budget using the prioritized spending approach jeopardizes the current service levels of highly valued programs 4/5/2013 Budget Retreat 14 Public Safety: The Realities •Current Outsourcing Proposals = degradation in service levels •Cross -boundary coordination –Communication Interoperability Issues –Automatic Aid = “turf” battles, but a real opportunity 4/5/2013 Budget Retreat 15 Summarizing the Impact of Expenditure Reduction Scenarios •It Impacts Achieving the Vision •How? •Budget cuts require staff reductions, but still do not balance the budget –Due to the cross-utilization of staff, any reduction affects multiple services and programs •Each of these scenarios ignores the significant unfunded cost burden of maintaining our infrastructure 4/5/2013 Budget Retreat 16 Five Year Financial Forecast Utility Fund 4/5/2013 Budget Retreat 17 Utility Fund (Enterprise Fund) Beginning Fund Balance $ 1,496,710 $ 1,290,356 $ 1,203,949 $ 877,931 $ 870,690 $ 871,078 Revenues 2,362,516 2,408,766 2,481,029 2,555,460 2,632,124 2,711,087 Impact Fees 40,000 18,000 18,540 19,096 19,669 20,259 Payroll, Benefits, and Related Expenditures (226,063) (227,292) (234,111) (241,134) (248,368) (255,819) Expenditures (742,654) (742,893) (765,180) (788,135) (811,779) (836,133) Water Purchases (1,051,600) (1,051,600) (1,083,148) (1,115,642) (1,149,112) (1,183,585) Debt Service (Hillwood Infrastructure Pymt) (50,000) (108,000) (111,240) (114,577) (118,015) (121,555) Debt Service (Keller Overhead Storage) (116,053) (116,468) (116,668) (118,212) (119,462) (118,949) Debt Service (Ground Storage Tank/annual payments) - - (185,000) (185,000) (185,000) (185,000) Capital Projects (360,000) (248,920) (311,700) - - - Transfer Out – Utility Major Maintenance (22,500) - - - Transfer Out - General Fund (Impact Fees) (40,000) (18,000) (18,540) (19,096) (19,669) (20,259) Net Fund Balance 1,290,356 1,203,949 877,931 870,690 871,078 881,124 Restricted Funds 135,000 135,000 135,000 135,000 135,000 135,000 Ending Fund Balance (projected) $ 1,155,356 $ 1,068,949 $ 742,931 $ 735,690 $ 736,078 $ 746,124 Operating Days 193 174 117 113 110 108  Based on current water and sewer rates. Utility Cost Increases •Wholesale water cost increase •Waste water treatment cost increases due to funding plant expansion •Staff to present recommendations in Fall 2010; prospective effective date 1/01/2011. 4/5/2013 Budget Retreat 18 Securing the Vision Preserving the Past & Achieving Our Vision for the Future This is Not New Scenario 1: Securing the Future •Objective: Stabilize the General Fund & provide funding for on-going infrastructure needs –Levy $2 Million in Operations and Maintenance (O&M) property tax •O&M rate estimated at $.2874 •$1 Million to stabilize the General Fund •$1 Million to reinvest in infrastructure on a cash basis –Hold bond elections to fund large capital projects 4/5/2013 Budget Retreat 21 Scenario 2: Preserving the Past •Mission 1: protect Westlake Academy and our Public Safety elements from Fiscal vulnerabilities –Levy Interest and Sinking (I&S) property tax sufficient to cover Westlake Academy’s Debt Service of $1.5M •I &S rate estimated at $.215 –Use existing Property Tax Reduction (PTR) sales tax revenues to preserve our public safety infrastructure by covering a portion of the cost. •PTR equals approx. $800k (will vary based on sales tax revenues) –Begin using the 4B sales tax dollars on other economic development activities •Mission 2: preserve the rich heritage of the rural atmosphere Westlake currently offers –Levy additional Operations and Maintenance (O&M) property tax as needed •Maintain Fund Balances •Cover non-bond Capital Improvements •O&M rate will vary per Truth in Taxation Standards 4/5/2013 Budget Retreat 22 Why a Property Tax? Why Now? •Current fiscal structure is fundamentally unsound; needs to be stabilized •Cost of the current service levels provided by the Town exceeds anticipated revenues •Depletion of savings jeopardizes the Town’s financial stability and bond rating •Establish tax prior to Circle T gas drilling •Need to invest in infrastructure 4/5/2013 Budget Retreat 23 Property Tax Impact Analysis •Current ratio: •Commercial 48% vs. Residential 52% •Ratio at build out in 2030: •Commercial 74% vs. Residential 26% –Comparisons based on total assessed value before abatements and exemptions. –Homeowners will receive a 20% Homestead exemption (approx. $62M that is not taxed) –Residents over 65 upon implementation of the tax will not be assessed property tax on their existing property (approx. $24M that is not taxed) 4/5/2013 Budget Retreat 24 Next Steps •Hold two public meetings to announce intent to levy property tax •Adopt Tax Rates on Sep. 29th 4/5/2013 Budget Retreat 25