CITY SERVICES INSTITUTE February 1, 2010 CITY SERVICES INSTITUTE Department of Financial Services November 15, 2010 Department of Financial Services

INTRODUCTION Barry Atwood – Director of Finance City Services Institute February 1, 2010 INTRODUCTION Barry Atwood – Director of Finance Appointed as Director in December 2007 Government experience – same position at Fort Lauderdale-Hollywood Int’l Airport South Florida Water Management District Prince William County, VA Gainesville, FL Consultant to local governments Partner with KPMG (CPA – Consulting Firm) 2 Department of Financial Services

City Services Institute October 12, 2009 CLASS OBJECTIVES Provide a brief overview of the Financial Services Department responsibilities Provide an opportunity to improve your understanding of City finances to answer – How are finances of the City structured? How are public services financed? How are tax rates calculated? 3 Department of Financial Services

CLASS GUIDELINES First, we’ll give a brief outline of the department’s responsibilities . . . Most of which are internal to other departments Majority of time spent on improving your understanding City finances and budgets You may ask questions as the class progresses rather than waiting until the end 4

DEPARTMENT RESPONSIBILITIES Listed in order of the “business cycle” Budgeting Purchasing Warehousing Collecting Revenues Disbursing Expenditures Investing Cash / Managing Debt Accounting 5

City Services Institute October 12, 2009 BUDGETING Participating in Budget Development (Operating & Capital) Calculating the Ad Valorem Tax Rate Monitoring the Budget During the Fiscal Year (October 1 – September 30) Reporting Budget Status 6 Department of Financial Services

PURCHASING Recommending Policy & Procedures Controlling/Processing City-wide Purchases Advertising Competitive Purchases Coordinating Selection of Vendors 7

WAREHOUSING Stocking Items Purchased Via Consolidated Buying Receiving & Delivering All Merchandise to Departments Maintaining All Historical City Records Prior to Authorized Destruction Coordinating the Receipt & Transfer of All Surplus Items For Sale 8

COLLECTING REVENUES Receiving and Safeguarding Receipts Depositing All Monies Received Providing Proper Revenue Accounting Monitoring Estimated Budgeted Revenues 9

DISBURSING EXPENDITURES Receiving All Invoices for Payment Disbursing Funds to All Vendors Disbursing Payroll to Employees Providing Accounting For Expenditures 10

INVESTING CASH MONITORING DEBT Monitoring Cash Flow Requirements Investing Funds According to Established Investment Policy Participating in the Issuance of Debt Monitoring Debt Compliance Requirements 11

ACCOUNTING Making & Reconciling All Accounting Entries For All City Funds Accounting & Inventorying Capital Assets Developing & Monitoring Internal Financial Controls Preparing Monthly & Annual Financial Reports of the City 12

FINANCIAL SERVICES ORGANIZATION - 20 STAFF MEMBERS Operate in 5 Sections Each With Multiple Functional Responsibilities Purchasing Warehousing Accounting Budgeting Revenue 13

STRUCTURE OF CITY FINANCES Organized in a “fund” structure based on – City operations External restrictions Governmental accounting requirements 14

STRUCTURE OF CITY FINANCES The City has 24 funds grouped into two broad activity types - Governmental activities includes General Fund Business activities includes Utilities Fund 15

STRUCTURE OF CITY FINANCES Governmental activities are those funds financed with Taxes and other revenues, such as General Fund Fire Assessment Fund Debt Service (Public Service Taxes) Fund 16

STRUCTURE OF CITY FINANCES Business-type activities are those funds financed with Fees charged to external parties such as Water & Sewer Utility Fund Solid Waste Fund Golf Course Fund 17

Citywide Total Budget = $174 Citywide Total Budget = $174.5 M - All Funds General Fund = 39% / Utility Fund = 18% / Capital Funds = 19% FY 2010-11 Budget Overview

Police & Fire = $45.4 M or 66% of Total $68.5 M General Fund Budget FY 2010-11 Budget Overview

Personnel Services = $55. 9 M or 82% of Total $68 Personnel Services = $55.9 M or 82% of Total $68.5 M General Fund Budget FY 2010-11 Budget Overview

2011 Citywide Funding = $174.5 M - All Funds Utility Fees = 18% / Transfers = 15% / Property Taxes = 13% FY 2010-11 Budget Overview

Total General Fund Sources = $68. 5 M Transfers $27 Total General Fund Sources = $68.5 M Transfers $27.0 M = 39% / Property Taxes $22.2 M = 32% FY 2010-11 Budget Overview

Millage & Property Taxes Levied FY 2004/05 to FY 2010/11($ Million) FY 2010-11 Budget Overview

General Fund Revenues Increased Only $4. 9 M (15 General Fund Revenues Increased Only $4.9 M (15.15%) While Net Property Taxes Decreased $1.5 M (6.46%) In 7-Year Period (FY 2004/2005 to FY 2010/2011) Source of Funds FY 2004/2005 FY 2010/2011 % Actual Budget Change Property Taxes $ 26,125,055 $ 25,507,000 -2.37% CRA TIF $ (2,419,760) $ (3,334,000) 37.78% Net Property Taxes $ 23,705,295 $ 22,173,000 -6.46% Other Taxes $ 3,625,269 $ 5,024,575 38.60% Licenses & Permits $ 8,202,387 $ 1,976,000 -75.91% Intergovernmental $ 8,589,609 $ 6,513,000 -24.18% Charges for Services $ 3,930,084 $ 4,427,000 12.64% Other Revenues $ 1,214,244 $ 1,388,937 14.39% Transfers $ 10,263,266 $ 27,048,334 163.55% Total $ 59,530,154 $ 68,550,846 15.15%

PROPERTY TAX PAYMENTS Paid to Palm Beach County Tax Collector Early Payment Discounts 4% November 3% December 2% January 1% February Taxes Due – By March 31 Taxes Delinquent – April 1 25

PROPERTY TAXES (General Fund Only) WHAT DERTERMINES THE RATE? Total budgeted expenditures Less non property tax revenues Equals amount to raise by property taxes Divided by per $1,000 of taxable property Equals tax (millage) rate per $1,000 of taxable property value 26

UNDERSTANDING TAXABLE VALUES, TAX RATE CHANGES & RESULTING TAXES LEVIED USING 2008 VS. 2009 Citywide taxable values – 15.6% decline 2008 = $4,584,615,400 2009 = $3,870,129,870 Tax rates – 18.5% increase 2008 = 6.5000 levied rate 2009 = 7.7000 rolled back rate Equal property taxes levied – 0% change 2008 = $29,800,000 2009 = $29,800,000 27

WHAT IS THE ROLLED-BACK RATE? The calculated tax rate - - - When applied to the City’s total taxable valuation, Levies the same amount of property taxes as in the prior year. 28

2008 vs. 2009 WHAT’S THE NEWS HEADLINE? 29

TAX RATE IMPACT ON INDIVIDUAL PROPERTIES A tax rate increase is not always a property tax increase Likewise . . . A tax rate decrease is not always a property tax decrease 30

ASSESSED VALUE DECREASED 15. 6% TAX RATE INCREASED 18 ASSESSED VALUE DECREASED 15.6% TAX RATE INCREASED 18.5% PROPERTY TAX – NO CHANGE 31

ASSESSED VALUE DECREASED 11. 7% TAX RATE INCREASED 18 ASSESSED VALUE DECREASED 11.7% TAX RATE INCREASED 18.5% PROPERTY TAX – NO CHANGE 32

ASSESSED VALUE DECREASED 15. 6% TAX RATE INCREASED 18 ASSESSED VALUE DECREASED 15.6% TAX RATE INCREASED 18.5% PROPERTY TAX – DECREASED 6.2% 33

ASSESSED VALUE INCREASED 0. 1% (COLA) TAX RATE INCREASED 18 ASSESSED VALUE INCREASED 0.1% (COLA) TAX RATE INCREASED 18.5% PROPERTY TAX – INCREASED 18.6% 34

BOYNTON BEACH GENERAL FUND TAX RATE LAST 10 FISCAL YEARS 2002 – 7.8160 2003 – 7.6000 2004 – 7.5000 2005 – 7.5000 2006 – 7.5000 2007 – 7.1000 2008 – 6.4553 2009 – 6.4553 2010 – 6.7626 2011 – 6.7626 Maximum Millage Rate = 10.0000 Per Florida Statute 200.081 35