HomeMy WebLinkAboutOrdinance 27639-05-2025Ot-dinance No. 27639-05-2025
AN ORDINANCE ADJUSTING ESTIMATED RECEIPTS AND
APPROPRIATIONS IN THE WATER & SEWER FUND, BY INCREASING
ESTIMATED RECEIPTS AND APPROPRIATIONS IN THE TRANSFER TO
WATER/SEWER ACCOUNT IN THE AMOUNT OF $36,860,42500 AND
DECREASING ESTIMATED RECEIPTS AND APPROPRIATIONS IN THE
DEBT TRANSFER OUT — PRINCIPAL ACCOUNT BY THE SAME AMOUNT;
PROVIDING FOR A S.F:VI= RABILITY CLAUSE.; :MAKING THIS ORDINANCE.
CURIE?LAT[VE OF PRIOR ORDINANCES; REPEALING ALL ORDINANCES IN
CONFLICT HEREWITH, AND PROVIDING AN EFFECTIVE HATE.
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF FORT WORTH, TEXAS:
SECTION 1.
That the budget of the City of Fart Worth for Fiscal Year 2024-2i125, as enacted by Ordinance 27107-09-
2024, as amended, is hereby further amender] to make the following adjustments to estimated receipts and
appropriations in the Water & Sewer Fund, by increasing estimated receipts and appropriations in the Transfer
to Water/Sewer account in the arnount of S36,860,425.00 and decreasing estimated receipts and
appropriations in the Debt Transfer Out— Principal account by the same amount.
SECTION 2,
That should any portion, section or part of a section ofth.is ordinance be declared invalid. inoperative or void
foran_v reason by acourt of competent jurisdiction, such decision, opinion or,judgment shall in no way impair
the remainingportion s, 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said prior ordinances and appropriations are hereby expressly repealed.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:
Douglas Black (Jun 9, 2025 16:12 CDT)
Douglas W, Black
Senior Assistant City Attorney
ADOPTED AND EFFECTIVE: May 13, 2025
CITY SECRETARY
Jannette S. Goodall
City Secretary
City of Fort Worth, Texas
Mayor and Council Communication
DATE: 05/13/25 M&C FILE NUMBER: M&C 25-0418
LOG NAME: 6OFY25BUDGETADJUSTMENT
SUBJECT
(ALL) Adopt Appropriation Ordinances Enacting Fiscal Year 2025 Budget Adjustments in the Water and Sewer Fund in the Total Amount of
$76,860,425.00 by Allocating Higher than Anticipated Projected Revenues and Interest Earnings to Offset Anticipated Operating Shortfalls and
Fund Departmental Capital Outlays and Capital Projects and Amend the Fiscal Year 2025 Adopted Budget and to Effect a Portion of Water's
Contribution to the Fiscal Years 2025-2029 Capital Improvement Program
RECOMMENDATION:
It is recommended that the City Council:
1. Adopt the attached appropriation ordinance increasing estimated receipts and appropriations .in the Water & Sewer Fund in the amount of
$40,000,000.00, from anticipated projected ,revenues, for the purpose of funding (1) increased operating expenses in the amount of
$14,800,000.00, (2) transfers to Water & Sewer Capital Projects Fund for the purpose of funding the Utility's pay-as-you-go capital program
in the amount of $22,000,000.00, and (3) transfers to the Water & Sewer Capital Projects Fund for the purpose of funding the capital
intrafund transfer out account in the amount. of $3,2001000.00;
2. Adopt the attached appropriation ordinance adjusting estimated receipts and appropriations in the Water & Sewer Fund by increasing
estimated receipts and appropriations in the Transfer to WaterlSew•er account in the arno.unt. of $36,8.60,425.0-0 and, decreasing estimated
receipts and appropriations in the Debt Transfer [Jut— Principal account by the same amount;
3. Adopt the attached appropriation ordinance increasing estimated receipts and appropriations in the Water Prior Lien Debt Service Fund
by increasing the use of net position generated from .prior year interest earnings in the amount of $24,539,297.00 and decreasing the
transfer from the Water & Sewer Fund by $36,860,425.00 and contribution to net position by $12,321,128,00;
4. Adopt the attached appropriation ordinance increasing estimated receipts and appropriations in the Water & Sewer Capital Projects Fund
in the amount of $3,200,000.00, from available funds in the Capital Intrafund. Transfer Out account within the Water &. Sewer Fund, for the
purpose of funding the Water and Sewer Outlay programmable project (City Project No. P00087); and
5. Amend the Fiscal Year 2025 Adopted Budget and the 2025-2029 Capital Improvement Program.
DISCUSSION
The purpose of this Mayor and Council Communication (M&C) is to recognize additional Water & Sewer revenue projected to be received by the
Utility due to higher than usual water usage revenues associated with increased demand. Temperatures in the fall months resulted in higher than
expected water usage for the months of October through December. Receipts and appropriations in the Water & Sewer Fund will be increased by
$40:00.0,00.0.00 to be used for operating costs affected by rising costs, increased water demand, as well as, supplementing the Utility's pay-as-
you-go capital program. In addition, this M&C takes actions to declare surplus funds from interest eamings in the Water Prior Lien debt Service
Fund by reallocating Water .& Sewer Fund transfers from the Debt Transfer Cut -Principal account to the Transfer to Water/Sewer account for the
purpose of funding the Utility's pay-as-you-go capital program.
Per Ordinance No. 27107-09-2024 Section 4, the Fiscal Year (FY) 2025 adopted budget for the Water and Sewer Fund was $616,963.,098.00.
The adopted budget was subsequently adjusted in the amount of $300,000,00 via M&C 24-0872 and in the amount of $245,500.00 via M&C. 25
0156 for an adjusted budget of $617,508,598.00. This M&C recommends an additional $40,000,000.00 in revenue appropriations for FY2025,
from anticipated projected revenues, for an adjusted budget of $657,508,598.00.
Expenditure appropriations in the General Operating and Maintenance accounts will increase by $14,800,000.00. Operational costs due to the
transition of the management of the bio.solMs program from a contractor to in-house staff, as well as a settlement with the vendor (M.&C 25-0281 ),
are driving an expected budget overrun to the FY2025 budget. Additionally, inflationary costs an:d supply chain issues, such as the cost of pipe and
electrical materials, are impacting the costs of debt -funded capital projects and the pay-as-you-go program as well. Consequently, the Transfer
appropriations will increase by $25,200,000,00 to allow the Utility to address these rising costs. The Utility will also fund equipment purchases
such. as valves, drives, pumps and compressors in FY2025 and two additional vehicles for u-se during safety inspections and field operations.
To balance these increases in expenditures, revenue appropriations will also increase by $40,000,000.00. due to increased demand, wholesale
and retail revenues are expected to exceed projections, helping to offset the aforementioned rising costs.
The City's Water Prior Lien Debt Service Fund generates interest income by prudently investing idle cash from operations, "pay as you go" capital
funds,, and bond funds in strict compliance with state law and City policy. The current practice is to allocate interest income from Water enterprise
activities to the City's Water Prior Lien Debt Service Fund to offset interest cost associated with outstanding debt issuances and to accumulate
cash which can be used to pay off debt prior to maturity to achieve debt .service savings. The City has benefited tremendously from the current
elevated Interest rate environment, resulting In betler=than-expected' interest earnings due to higher than normal Federal Funds rates,
As a result, City staff has identified approximately $36,860,425,00 of excess funds above the minimum reserve requirement in the City's Water
Prior Lien Debt Service Fund. Staff recommends for City Council to declare this surplus of interest income receipts, by reducing current year debt
service transfers from the Water & Sewer Fund to the Water Prior Lien Debt Service Fund. By decreasing the transfers for debt, this allows the
reallocation of the funds to the Transfers to Wate0Sewer account by the same amount for the purpose of funding the Utility's pay-as-you-go capital
program.
Staff will monitor collection of investment income from utility operations to identify any surplus that can be used for other lawful purposes. Given the
variable nature of investment income, any surplus may 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.
The actions in this M&C will amend the FY2025 Adopted Budget as approved in connection with Ordinance 27107-09-2024 Section 4, Enterprise
Funds, as listed on page 22.
Water -and Sewer 0neratin❑ Fund:
FY2025
Budget Revised
Fund/Department, Adopted Authority',
Budget Category Budget]
Adjustment FY2025 Budget
I
(Revenues(
I
--
(License and
$i,910,000.fl0
$1,910,000.00�
(Permits
i
--
------
ges for (Char,
Charces
�$562,502,751.00 0156i M&C 25-
$245,500.00
$562,748,251.00�
1
J
This MBCI�
$40,000,000.00.
$40,000,000.00�
'Use of Money and
�
Property
$2 596,386.0
$2,596,386-00'
Other Revenue
$13,765,000.00
$13,765,000.00
Sale of Capital
$100,00Q,00
$1D0,000.001
� Asset
�I
i
Salvage Sales
1 $30,000.90 �
�'
$30,000.00
Transfer from
$13.1865,588.00'
$13,865,588.00
{{ Water f Impact
Transfer from
Sewer Impact
}: $18,143,557.0-0
1
$18,143,557.00
Transfer from
Environ Protection
$756,690.00
$756,690,00
Fund
Transfer from
stormwater Utility
$1,562,024.00� I
$1,552,024.00
Fund
I
Transfer from Solid'
VV.aste Fund.
_
$1,731,102,00`
i
$1,731,102.00
lUse of Net
'
M&.0 24-
y
$300,000.001
$300,0130,00
Position
0872
i' - - -- - �- --
ITotat Revenues $616,963,098.00
�i. Expenditures
Water $229,115,919.00 M& 08
$40, 545,500,00 '$657,508,59r8
$300,000.00 229,415,919-00
I M8 015- *122,750.001 $122,750M
��-Reclaimed Water $211,659.00 I $111,.65.9.ffC�
i
Wastewater $129,555,32.0.00 This M&C $14,8001000.00 $144,355,.320..00 1
M.&G 25- $122,750-00� $122,750.00
0156 1
�Transfertoii+later $7 796,463,00 This M&G $3,200,000.00� $10,996,463.001
JCapitai .Eland
Transfer to General
(Fund to Energy �I $27,005M
Savings Program
(Transfer to HR for i p $1 738,600.00
asitiORS
Transfer for j f
Parking $•2.18,105A0
(f
i-
I'Transferto Water
f and Sewer Capital $92,597,771.00 This M&C
iFund I ,
Payment in Lieu of
Rental
$6,098,464..00
- - —
$28,755,154.00'
Transfer to Water
Debt Funds i$120666,320,00 This
Transfer to IT
Refresh Capital $182,311$.tYa�,
Total $616,963,098.00� -
jExpenditures
Water Phorlty Lien Debt 5ervtee FqosL
$2.7,005.00
$1,738,600,00
$218,105.00
$58,860,425.00 $151,458,196.00i
- $6,098,464.001
i 11l
I
$2$,755,154.00�'
Q6,860,425.00}, $83,805,895.00
$182, 318.41f�
$40,545,500.00 $557,508,598200
FY2.025� Budget Revised
Fund/Department' Adopted Authority Adjustment FY2025 Budget]
Budget Category Budget
Revenues
Transfer tram Water &sewer $120,666,32.00 This M&C { } $36,860,425,00 $83,805,895.00
I
Use of Net I -Position M&C $24,539,297.001 $24,539,297.00
i I
Total Revenues $120,666,320..00 i($12,321,128.00) $108,345,192,00
Expenditures
Financial
Management ,$1081345,192,0�0i1 �'
Services (Debt
Obligation)
Contribution to I
Fund BalanceiNet iI $12.321,128A011his
Position
Total
Expenditures $'120,666,.320.00
1.I
Water & Sewer Cao•ital Project Fund
$108,345,192,0.0'I
2,321,128,00) $0-00;
21321,128,00j $•108,345,192.0�0 '
The FY2025 adopted budget for the Water and Sewer Capital Project Fund in the programmable Capital Outlay project (P00087) was
$7,796,463.00. This M&C recommends an additional $3,200,000.00, from newly recognized revenues, in appropriations for FY2025, for an
adjusted budget of $10,996,463.00.
Capital IProject� FY2025 CIP
Fund , Name ppro•priations,Authority
Name
Water & P000871 I
Sewer _ Water
Capital &
Projects Sewer
Outfay
,56002 $7,796,463-00. This M&C
$7, 796.463.00
Budget Changes Revised
(Increase/Decrease) FY2025
Budget.
This project is located in ALL COUNCIL DISTRICTS.
I
$3,200,000.00 $10,996,463.00�
$3,200,000.00 $10,996,463.00
-. J
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 funds are currently available in the Water Prior Lien Debt Service Fund and upon approval of the above
recommendations and adoption of the attached appropriation ordinances, funds will be available in the current operating & capital budgets, as
appropriated, in the Water & Sewer Fund and in the W&S Capital Projects Fund for the Water and Sewer Outlay programmable project. Prior to
any expenditure being incurred, the Water Department has the responsibility to validate the availability of funds.
Submitted for Citv Manaaer's Office bv: Jesica McEachern 5804
Oriainatina Business Unit Head: Chris Harder 5020
Additional Information Contact: Sarath Padar 6407
Expedited