HomeMy WebLinkAboutOrdinance 27395-01-2025 (2)Ordinance No. 27385-01-2025
AN ORDINANCE INCREASING ESTIMATED RECEIPTS AND
APPROPRIATIONS IN THE RISK FINANCING FUND, IN THE AMOUNT OF
$5,000,000.00 TRANSFERRED FROM THE GENERAL FUND, FOR THE
PURPOSE OF INCREASING THE RESERVE FOR UNFUNDED PROPERTY AND
LIABILITY CLAIMSISETTLEMENTS; MAKING THIS ORDINANCE
CUMULATIVE OF PRIOR ORDINANCES; REPEALING ALL ORDINANCES IN
CONFLICT HEREWITH; AND PROVIDING AN EFFECTIVE DATE.
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF FORT WORTH,
TEXAS:
SECTION 1.
That in addition to those amounts allocated to the various City departments for Fiscal Year 2024-2025 in the
Budget of the City Manager, there shall also be increased estimated receipts and appropriations in the Risk
Financing Fund, in the amount up to $5,000,000.00 transferred from the General Fund, for the purpose of
increasing the reserve for unfunded property and liability claims/settlements.
SECTION 2.
That should any portion, section or part of a section of this ordinance be declared invalid, inoperative or void
for any reason by a court of competent jurisdiction, such decision, opinion or judgment shall in no way impair
the remaining portions, sections, or parts of sections of this ordinance, which said remaining provisions shall
be and remain in full force and effect.
SECTION 3.
That this ordinance shall be cumulative of Ordinance 27107-09-2024 and all other ordinances and
appropriations amending the same except in those instances where the provisions of this ordinance are in
direct conflict with such other ordinances and appropriations, in which instance said conflicting provisions of
said prior ordinances and appropriations are hereby expressly repealed.
SECTION 4.
This ordinance shall take effect upon adoption.
APPROVED AS TO FORM AND LEGALITY:
Assistant City Attorney
ADOPTED AND EFFECTIVE: January 14, 2025
CITY SECRETARY
Jannette S. Goodall
City Secretary
City of Fort Worth, Texas
Mayor and Council Communication
DATE; 01/14/25 M&C FILE NUMBER: M&C 25-0003
LOG NAME: 03FY24 CLOSING
SUBJECT
(ALL) Enact Budget Adjustments to Reallocate Resources, Commit Funds to Facilitate Fiscal Year 2024 Rollover into Fiscal Year 2025,
Reallocate General Fund Appropriations in Fiscal Year 2025, and Adopt Appropriation Ordinances
RECOMMENDATION:
It is recommended that the City Council:
1. Reduce unpledged and unencumbered interest earnings in the General Debt Service Fund by $29,717,000.00 and increase interest
earnings in the General Fund by the same amount, for assigment to one-time special projects and/or capital needs to be submitted for City
Council appropriation at a future date;
2. Authorize the assignment of $64,446,937.00 in Fiscal Year 2024 fund balance comprised of Fiscal Year 2023 remaining fund balance
assigned to capital needs in the amount of $24,099,963.00, Interest Earnings from Fiscal Year 2024 in the amount of $29,717,000.00, and
Fiscal Year 2024 savings in the amount of $10,629,974.00 for immediate and potential future appropriation as follows:
a. $9,472,519.00 for potential Library capital projects;
b. $47,034,978.00 for capital project shortfalls;
c. $2,939,440.00 for ambulance/MedStar transition; and
d. $5,000,000.00 to offset a defcit in the Risk Fund;
3. Designate $3,552,571.00 as committed Fiscal Year 2024 fund balance from Fiscal Year 2024 savings in the General Fund for contractual
commitments and rollover into Fiscal Year 2025 as follows:
a. $707,205.00 in the City Manager's Office;
b. $227,666,00 in Diversity and Inclusion Department;
c. $470,594.00 in FWLab;
d. $109,000.00 in Human Resources Department;
e. $518,058.00 in Neighborhood Services Department;
f. $61,456.00 in Police Department; and
g. $1,458,592.00 in Property Management Department;
4. Adopt the attached appropriation ordinance increasing estimated receipts and appropriations in the General Fund Non -Departmental
Department in the amount of $2,939,440.00 from available assigned fund balance for the purpose of funding the transition of ambulance services
from MedStarto the City;
5. Adopt the attached appropriation ordinance revising Fiscal Year 2025 General Fund receipts and appropriations by increasing estimated
receipts and appropriations in the General Fund in the amount of $5,000,000.00, from interest earnings for the purpose of transferring to the Risk
Financing Fund;
6. Adopt the attached appropriation ordinance increasing estimated receipts and appropriations in the Risk Financing Fund in the amount of
$5,000,000.00, transferred from the General Fund, for the purpose of increasing the reserve for unfunded property and liability claims/settlements;
7. Adopt the attached appropriation ordinance increasing estimated receipts and appropriations in the General Fund in the amount of
$3,552,571.00 and decreasing the unaudited General Fund fund balance by the same amount in order to fund identified rollovers;
8. Adopt the attached appropriation ordinance increasing estimated receipts and appropriations in the Municipal Parking Fund in the amount of
$18,628.00 and decreasing the unaudited Municipal Parking Fund fund balance by the same amount in order to fund contractual commitments;
9. Adopt the attached appropriation ordinance increasing estimated receipts and appropriations in the Stormwater Utility Fund in the amount of
$110,323.00 and decreasing the unaudited Stormwater Utility Fund fund balance by the same amount in order to fund contractual commitments;
and
10. Amend the Fiscal Year 2025 Operating Budget.
DISCUSSION:
The City of Fort Worth's annual Operating Budget is formally enacted into law by City Council action adopting an appropriation ordinance that
establishes spending limits for each department's operation.
The purpose of this Mayor and Council Communication (M&C) is to adjust the final budget and authorize transactions to reflect actual performance
for the Fiscal Year ending September 30, 2024. Any amounts over budget must be appropriated by action of the City Council, in accordance with
the City Charter (Chapter X, Section 5, Expenditures Only Pursuant to Appropriations). This action represents the final step before the external
audit can be completed and the Annual Comprehensive Financial Report published after the wind-up M&C (24-0697) approved by City Council on
August 27, 2024.
Department dditio A ro riations
Approyal of this M&C will amend the Fiscal Year (FY) 2025 Adopted Budget, as approved with Ordinance 27107-09-2024.
OTHER FUNDS
Municipal Parking Fund: $18,628.00
Reason: There were three insurance claims that were not verified prior to the fiscal year ending. The claims have now been verified and payment
can be issued.
Stormwater Utility Fund: $110,323.00
Reason: The FUSE Fellowship ended in October and the agreement cannot be extended. Funding will be rolled over to continue the program until
the end of the fiscal yearto assist with the Riparian Initiative.
Assignments of Fund Balance
General Fund: $64,446,937.00
Reason: Assigning fund balance is a regular practice as part of the year end close process. Each year, unassigned fund balance is measured
against the policy minimum balance. To the extent unassigned fund balance in excess of policy requirements is identified, such amount is
compared to known financial needs that fell outside the current operating budget. The following requirements have been identified as prudent uses
of the FY 2024 fund balance:
Description
Amount
Library Capital projects funded by FY 2023 remaining
$9,472,519.00
assigned fund balance
Capital Projects Shortfalls funded by FY 2023
$14,627,444.00
remaining assigned fund balance
Capital Projects Shortfalls funded by FY 2024 savings
$7,690,534.00
Capita[ Projects Shortfalls funded by FY 2024 interest
$24,717,000.00
earnings
MedStar Transition funded by FY 2024 savings
$2,939,440.00
Risk Fund Offset funded by FY 2024 interest earnings
$5,000,000.00
Total
$64,446,937.00
With the exception of the ambulance/MedStar Transition and Risk Fund Offset, these priorities will be presented for approval to Council during the
course of FY 2025 and appropriated at the time of approval. Assigning the funds as outlined results in the City increasing the unassigned fund
balance to 22% of FY 2025 budgeted expenses. The minimum reserve required by the current Governmental Reserve Policy is 16.67% with a goal
of 25%.
Rgeocinition of Interest Earnings
The City generates investment income by prudently investing idle cash from operations, "pay as you go" capital funds, and bond funds in
compliance with state law and City policy.
The existing practice, in compliance with the current Revenue Policy, is to allocate investment income from governmental funds, derived from
resources other than bond or debt proceeds, in the City's General Debt Service Fund to one-time capital projects or contributing to unassigned
fund balance as recommended by the City Manager.
The FY 2024 closeout analysis has identified $29,717,000.00 of unpledged surplus investment income. Staff recommends for City Council to
authorize the recognition of this unpledged and unencumbered investment income in the General Fund ratherthan the Debt Service Fund in FY
2024-so that such funds can be used to fund one-time initiatives andlor capital projects, to be presented for City Council's consideration at a
subsequent date. Recommendation 2 of this M&C assigns this amount for such one-time projects.
Going forward, staff will monitor collection of investment income from general government operations to identify any surplus that can be used for
other lawful purposes. Given the variable nature of investment income, any surplus will generally be prioritized to fund one-time initiatives, capital
projects, or to accumulate cash which can be used to pay off debt prior to maturity to achieve debt service savings.
This action does not encompass income derived from the investment of debt proceeds, which continues to be allocated to the appropriate Debt
Service Fund in accordance with legal and policy requirements. Nor does it include investment earnings attributable to purpose -restricted funds
such as Water & Sewer, Stormwater, Crime Control Prevention District, etc. or to funds that are subject to other legal or policy constraints. Those
funds will continue to receive their appropriate allocation of investment income.
Commitment of Funds and Rollover
GENERALFUND
Previously Committed Fund Balance for es Tax Renavment Agreement
General Fund: $11,532,030.00
Reason: This funding was committed in the FY 2023 year-end closing M&C 24-0001. In 2011, and again in 2021, it was determined that the City of
Fort Worth had been paid sales and use taxes for equipment that was later found to be tax-exempt. Agreements were entered into with the State
for a repayment plan. Of the two repayment agreements, a combined $11,532,030.00 remains outstanding as of September 30, 2024.
Previously Committed Fund Balance for Juneteenth Museum o'e
Capital Projects: $15,000,000.00
Reason: This funding was committed in the FY 2023 year-end closing M&C 24-0001. The City of Fort Worth has a standing agreement to fund part
of a Juneteenth Museum. The organizers have not yet reached their funding requirements; therefore, the City is retaining the funding as committed
fund balance until the additional funding requirements are met.
Committed Fund Balance for Contractual Obligations Rolled Over korn Fl5cal Year 2024
City Manager's Office: $707,205.00
Reason: Funding will be rolled over for Emergency Medical Services transition consulting services. This non -recurring expense will be paid during
FY 2025.
Diversity and Inclusion: $227,666.00
Reason: Funding will be rolled over for consulting services that began in FY 2024 and will conclude by the end of FY 2025.
FWLab: $470,594.00
Reason: Funding will be rolled over to pay costs related to the 2050 Comprehensive Plan including consultant costs.
Human Resources: $109,000.00
Reason: Funding will be rolled over to pay for consulting services related to the alignment of MedStar Memorandum of Understanding with the Fire
Department and to continue a contract with VtalSmarts that was delayed.
Neighborhood Services: $518,058.00
Reason: Provide funding in FY 2025 for a 17 month high lmpACT pilot program to provide mental health and homeless resources in the City of
Fort Worth and provide funds for the recruitment of an assistant director position.
Police: $61,456.00
Reason: Funding will be rolled over to secure the purchase of various supplies including, uniforms, ammunition, Lewis Machine & Tool multi -
launchers, and camera parts. Items were purchased in FY 24 but were not received prior to the close of the fiscal year.
Property Management: $1,458,592.00
Reason: Funding will be rolled over to provide renovations at New City Hall I that were delayed due to supply -chain issues and for a professional
services agreement with Athenian Group whose work was not fully completed in FY 2024.
Current Fiscal Year Appropriation Adjustments
GENERAL. FUND
FY2025
FY2025
General Fund
Department
Adopted
Prior M&C
Budget
Increase
Revised
Budget
Budget
Revenue
e of Fund
tlance
$0.00
$3,552,571.00
$3,552,571.00
Expenditures
$100,000.00
City Manager's
Office
$9,791,224.00
M&C24-
$707,205.00
E$1.698,429.00
1031
Diversity and
Inclusion
$2,863,536.00
$227,666.00
$3,091,202.Ob
Mab
$12,672,222.00�
$470,594.00
$13,142,816.00
Human
Resources
$7,999,360.00
$109,000.00
$8,108,360.00
Neighborhood
Services
$17,508,181.00
$518,058.00
$18,026,239.00
Police
$327,208,011.00�
$61,456.00
$327,269,467.00
Property
Management
$36 347,708.00
$1,458,592.00
$37,806,300.00
STORMWATER UTILITY FUND
FY2025
FY2025
Stormwater
Adopted
Prior
Budget
Revised
Utility Fund
Budget
M&C
increase
Budget
Revenue
Use of Fund
$56,881.00
$110,323.00
$167,204.00
Balance
Expenditures
Stormwater
$64,574,824.00
❑
$110,323.00
$64,685,147.00
Utility
MUNICIPAL PARKING FUND
Municipal
FY2025
Prior
Budget
FY2025
Parking Fund
Adopted
M&C
Increase
Revised
Budget
Budget
Revenue
Use of Fund
Balance
$0.00
$18,628.00
$18,628.00
Expenditures
Municipal
Parking
$8,391,178.00
$18,628.00
$8,409.806.00
Approval of this M&C will amend the Fiscal Year 2025 Adopted Budget, as approved with Ordinance 27107-09-2024.
Funding is available for appropriation in the fund balance of the General Fund, Stormwater Utility Fund, and Municipal Parking Fund. The interest
income originally planned to be recognized in the General Debt Service Fund is unpledged, unencumbered, and available to be recognized in the
General Fund instead.
A Form 1295 is not required because: This M&C does not request approval of a contract with a business entity.
FISCAL. INFORMATION 1 CERTIFICATION:
The Director of Finance certifies that upon approval of the above recommendations and the adoption of the attached appropriation ordinances,
funds will be available in the FY2025 operating budgets as appropriated. Prior to any expenditure being incurred, the participating departments
have the responsibility to validate the availability of funds.
Submitted for City Manag_ees Office by: Mark L McDaniel 6316
Originating Business Unit Head: Christianne Simmons 6222
Additional Informa i Contact:
Expedited