Monday, August 22, 2016

Richardson's Budget - Black or Red?

It's August and that means it's time for Richardson budget roulette. Will the proposed city budget be balanced? You'd think that would be a simple question. Isn't the city required by law to have a balanced budget? Well, yes, but it all depends on the meaning of "balanced".

Last year when I looked at this question, I concluded that the city's 2015-2016 budget was indeed balanced and didn't require use of that sneaky asterisk ("plus reserved fund balance and other financing sources").

After the jump, reviewing that conclusion and looking ahead at 2016-2017.

Last year's adopted budget forecast an ending fund balance of $48,325,491. This year's proposed budget shows a beginning fund balance of $54,286,732. It looks like we didn't have to draw down any fund balances to keep the overall budget in balance. So far, so good.

Now let's look at the 2016-2017 proposed budget.

Budget FY 2016-17
Beginning Fund Balances$54,286,732
Operating Revenues$255,983,192
Operating Expenditures$251,064,930
Ending Fund Balances$59,204,994

Once again, the ending fund balance is greater than the beginning balance. That means the budget is balanced without needing to draw down the fund balances. That means the budget is squarely in the black without reliance on any sneaky asterisks. Ta-da! Woohoo! WE DID IT!

Of course, that shouldn't have been hard. Property tax collections are forecast to go up $9.5 million, of which $1.1 million is from new property added to the tax rolls. We're benefiting from both growth and a boom in real estate prices. Rates for water, sewer and solid waste collection are also going up. With all the extra money, it's no wonder the city has found the means to offer both a one cent tax rate reduction and an increase of $940 thousand in funds dedicated to street maintenance. It's the least they could do.

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