Fort Worth City Manager David Cooke presented the city council with a presentation on the long-range financial outlook for the city with forecasts for the Fiscal Years 2020-26.
“This is where we are with what we know and what the next few years look like,” Cooke said.
General fund revenue assumptions include property tax revenue growth at 4 percent. When tax increment financing (TIF) expires, a reduction in the property tax rate, keeps property tax growth at 4 percent.
Cooke noted that the North Tarrant Parkway TIF is set to expire late this year, and he said that could allow for a reduction in the tax rate of about a penny. Other upcoming TIF expirations include Southside Medical at the end of 2022 and Lancaster in 2024.
Property tax revenue (1 percent variance) during the period between 2020 and 2026 is an estimated $3.9 million. Sales tax revenue (1 percent variance) is an estimated $1.6 million, and other revenue, forecast at 1.17 percent, is an estimated more than $160 million.
General fund expenditure assumptions include:
*Police department meeting and conferring agreement.
*Fire department collective bargaining agreement.
*Pay for performance (non-sworn) at 3 percent annually.
*Prior year commitments.
*Implementation of 2018 bond program.
*Includes additional 1.5 percent pension contribution and risk sharing.
Capital, operating impacts of capital and other obligations are an estimated $163.6 million.
The general fund operating forecast, with 4 percent property and sales tax growth has estimated operating revenues of around $5.49 billion and operating expenditures of around $5.50 billion.
Cooke said another bond referendum could be ahead in the 2022 time period. By then, he estimated there will be about $590 million in debt capacity to pay for infrastructure development at that time to help cope with what is expected to be a population increase of around 100,000.
Crime Control Prevention District forecast/assumptions:
*4 percent annual sales tax growth.
*Total compensation (salary and benefits) no higher than 3 percent annually.
*Includes additional 1.5% pension contribution and risk sharing.
*Fund balance level is maintained at 16.67 percent of recurring expenditures.
*Election in November 2019 or May 2020 (the authorization of the CCPD runs out in September of 2020).
The CCPD operating forecast, with the 4 percent sales tax growth, has estimated operating revenues of around $673.5 million and operating expenditures of around $605 million.
Funding scenarios for the overall estimates include:
*Using financial models to identify policy choices.
*FY 2020 assumptions, which include continuing implementation of bond programs, constraining the operating budget, and addressing the pension.
*Code and police staffing.
“We know we’re going to go into the upcoming budget with a deficit in the general fund we’re going to have to manage through. What fixes that is either revenues come in higher or departments ask for less money,” Cooke said. “My bet is we don’t get the latter, so you’ve got to count on the former.
“The Legislature in Austin is committed to limiting flexibility on that revenue side, so we’ll keep an eye on the Legislature throughout this process this year, but going into the budget we’ve got that imbalance.”