1. Fiscal Year FY2016 Tax Rate Proposed vs. Adopted Budget

2. Agenda Items Adopt FY2016 budget Cover page requirements Adopt budget Record vote on tax rate Specific wording required to adopt Specific verbiage included in tax ordinance Ratify tax rate 2 Adheres to all truth in taxation requirements

3. Property Tax Rates.01 = $400,000 Adopted Rate (FY16) $0.579150Maximum Tax Rate (FY16)$0.595520Proposed Tax Rate (FY16) $0.555520Rollback Tax Rate (FY16) $0.555524Effective Tax Rate (FY16) $0.534304Adopted Rate (FY15) $0.561800.01 = $400,000

4. Tax rate calculations 4 Change in Total Tax Rate This year's adopted Total tax rate:0.579150 Minus this year's Effective Total Tax Rate:0.534304 Increase amount:0.044846 Percent increase in Total tax rate:.044846 /.534304 =8.39%

5. Tax rate calculations 5 Change in M&O Tax Rate Only This year's adopted M&O tax rate:0.376724 Minus this year's Effective M&O Tax Rate:0.326943 Increase amount:0.049781 Percent increase in M&O tax rate:.049781 /.326943 =15.23% Raised M&O Taxes on a $100,000 Home Taxable Value on a $100,000 home:$100,000 This year's adopted M&O tax rate:0.376724 Minus last year's M&O tax rate:0.343700 Increase in M&O tax rate over last year:0.033024 Dollar increase in M&O taxes over last year:.033024/100 * 100,000 =$33.02

6. FY2016 Tax Rate Comparison Tax Rate ComponentProposed Rate Adopted Rate M&O: General Fund0.3283210.345750 M&O: Economic Development Fund0.024773 M&O: Infrastructure Investment Fund0.0000000.006201 Debt Service Fund Rate0.202426 Total0.5555200.579150 6

7. Impact on the Average Homeowner The average taxpayer would pay about $110 ($9.16 per month) more than last year depending on their home value *Taxable Value

8. FY2016 Major Challenges – City Manager Proposed General Fund Decrease in sales tax had significant impact on fund Sales tax revenue projections reduced due to loss of major sales tax payer Funding of capital replacement significantly reduced Utility Fund Increased cost of wholesale water rates Infrastructure Investment Fund Unable to fund for FY2016 due to sales tax decrease 8

9. All Funds Overview 9 All Funds$109.8M General Fund$33.3M Hotel Fund$5.8M Economic Development Fund$1.7M Special Revenue Funds$51K Debt Service Fund$8.9M Infrastructure Investment Fund$955K Capital Projects (Bond Funded)$31.5M Airport Fund$4.9M Utility Fund$13.7M Storm Water Fund$6.2M Combined Replacement$2.8M

10. FY2016 Adopted Budget 10 General Fund budget is balanced Certified taxable property value increased 6% over FY2015 for a value of $4B Increase in tax rate generates $956K in additional revenue from proposed Fully funds all capital replacement items Funds Infrastructure Investment Fund Key Facts

11. FY2016 Adopted Budget 11 Staffing levels remain the same as FY2015 Modified Levels of Service total $225,000 Fund balance requirements met Funding for Capital Projects over $41M Includes water rate increases due to wholesale rate pass-through Key Facts

12. 12 Infrastructure Investment Fund No funding proposedFunded $250K Capital Equipment Replacement Fund Funded at $100KFunded at $800K Compensation $142K allocated for one-time payment$580K allocated for base adjustment Tax Rate $0.555520$0.579150 Budget Changes

13. 13 Library Cards Expenditure $175,000$114,000 Vitruvian Lights/Nights In Council ProjectsIn Special Events Capital Projects (Bond Funded) – Midway Road $225,000$1,700,000 Les Lacs/Winnwood Ponds $1,250,000$2,400,000 Budget Changes

14. Adopted Modified Level of Services DepartmentMLSAmountRecurring Special EventsEnhancements for Taste Addison Entertainment $100,000*Yes Conference CentreNew Carpet Replacement $60,000No Performing ArtsReplace Cyc Lights and Stage Lights $40,000No TourismWorld Affairs Council Additional Funding $25,000Yes 14 * Net amount

15. Questions? 15DRAFT

16. Tax Rate Adoption 16 Texas Tax Code, Sec. 26.05 (d) As part of the requirements of adopting a tax rate, a municipality may not adopt a tax rate that exceeds the lower of the rollback tax rate or the effective tax rate calculated as provided by this chapter until the governing body has held two public hearings on the proposed tax rate. *must comply with posting regulations

17. Budget Adoption 17 Texas Local Government Code, Sec. 102.006 As part of the requirements of adopting a budget, the governing body of a municipality must hold at least one public hearing on the proposed budget before the budget is adopted. Any person may attend and may participate in this hearing. *must comply with posting regulations