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  G.2.       
Meeting Date: 09/17/2019  
Contact: Tracy Cormier, Managing Director of Financial Services

COUNCIL ACTION
Motion by Councilmember Marks with a second by Councilmember Quarles to approve as presented. Motion passes 5-1 (Councilmember Raphiel opposed).  Note: This was a Roll Call/Record Vote.
AGENDA ITEM:
Consider an Ordinance adopting the Budget for the Fiscal Year Beginning October 1, 2019, and ending September 30, 2020; adopting the 2020-2024 Capital Improvement Plan (CIP), adopting The 2019-2020 Business Plan, and amending the Base and Volume Rate Charge For Water Service Fees, amending the Base and Volume Charge For Sewer Service Fees and amending the Sanitation rate.
BACKGROUND:
The proposed Budget, Capital Improvement Plan (CIP), and Business Plan were presented to the City Council on July 20, 2019, during the summer retreat.  Discussion on the proposed items was held during the budget workshops held on July 25-26, 2019.
 
The summaries of the proposed 2019-20 and planning 2020-21 Budget, CIP, and Business Plan were provided to the Council, and the entire set of documents are available at the City’s Library, the Action Center, Senior Center and on the City’s website at www.desototexas.gov
 
Also, attached as Exhibit B is a list of budget amendments for the Fourth (4th) Quarter of Fiscal Year 2018-19 Budget.  Budget amendments are requested due to unanticipated revenue and expenditures that were not part of the adopted budget.  Amendments will increase or decrease revenue and expenditures for the department or fund.  
FINDINGS:
The Proposed FY2020 Budget and all supporting schedules are on file with the City Secretary and are open to public inspection.  Final adoption of the budget shall constitute the official appropriation for FY 2020 and is the basis for the official levy of property taxes for the 2019 tax year.  
 
Annually, the City Council reviews the CIP and continues the planning process for projects identified on a 5-year horizon.  Through this planning process, the City Council established the FY 2020-2024 CIP.  Projects identified in FY 2020 and beyond are currently unfunded, with a funding source to be established at a later date.  The 2019-20 Business Plan was also submitted as part of the budget process.
 
The budget discussions involving the Public Utility Fund identified the need to raise the base and volume rate for the water service and the wastewater (sewer) base rate and volume rate charges to cover the increased costs for sewer services from Trinity River Authority and Dallas Water Utilties, and the costs associated with the debt sold for Water and Sewer projects to replace, rehabilitate, and expand the system.
 
The budget discussions involving the Sanitation Fund identified the need to raise the sanitation rate to cover the additional cost of recycling and increased operational expenses.
 
FINANCIAL IMPACT:
The total tax rate required to finance this budget is 70.1554 cents per $100 of valuation, with the Maintenance and Operating portion of 55.016 cents per $100 valuation, and the Interest and Sinking portion reduced from prior fiscal year to 15.1394 cents per $100 valuation.  
 
In the Public Utility Fund, the water base and volume rate will increase by 4%.  Also, a 6.0% increase in the base rate and a 7% increase in the volume rate will be implemented for wastewater service.  The rate increases will be adopted on both the base and volume portion of the rate structure.  
 
The Sanitation Fund Budget for FY2019-2020 has proposed a 15% increase in the sanitation rate from the current rate of $18.00 to $20.70.  The increase is proposed to maintain current service levels and cover the increased recycling costs incurred by the City. Sanitation rates have remained the same since FY2012, despite annual increases in operational costs. 
 
RECOMMENDATION:
Staff recommends Council approve an Ordinance adopting the Budget for FY 2020, amending the FY2019 Budget, adopting the Capital Improvement Plan for 2020-2024, adopting the 2019-2020 Business Plan, amending the Code of Ordinances by amending Appendix A, Article 19.000 (a)(1) Water Service Charges and Article 19.000 (a)(3) Water Service Charges and Article 19.000 (a)(5), Water Service Charges, and amending Appendix A, Article 20.000 (a)(1) and Article 20.000 (a)(2) Sewer Service Charges; Article 20.000 (b)(1) Sewer Service Charges; Article 20.000 (b)(2) Sewer Service Charges; Article 20.000 (c)(1) Sewer Service Charges; Article 20.000 (c)(2) Sewer Service Charges.  Amending the code of Ordinance by amending Solid Waste Collection Fees; Article 30.00.
 
MANAGEMENT REVIEW
Attachments
Ordinance Adopting FY20 Budget
Exhibit B


    

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