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SOURCES OF REVENUES AND TYPES OF EXPENDITURES

Rick Dollahan Gaines & Dawson County Auditor

OVERVIEW

Commissioners Court Members Need to Know: ! The Sources of Revenues Available to the County ! Accounting and Fund Structure ! Revenue Budgeting ! Revenue Management

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SOURCES OF REVENUES

! Ad Valorem Taxation ! Intergovernmental Revenues ! Fees of Office ! Court Fines ! Investment Income ! Miscellaneous Revenues ! Debt and Fund Balances

TAXES

! Property Taxes – ! Tax Calendar – Publications and Hearings ! Truth in Taxation ! Effective Tax Rate ! Rollback Tax Rate ! Delinquent Taxes & Collections

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TAXES (Cont.)

! Local Sales & Use Taxes ! Tax Code Section 323 for process ! Offsets property tax revenue/lowers the

effective and rollback rate ! More volatile than property taxes

INTERGOVERNMENTAL REVENUES

! Contractual Revenues – All Services Can Be Contracted Through the Interlocal Cooperation Act

! Statutory Intergovernmental Revenues ! Grants – Federal, State, and Private

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FEES OF OFFICE

! Statutory Basis for Fees Charged ! Specific Officers’ Fees ! Fees for Specific Services/Duties ! Separate Budgeting & Accounting For

Special Revenues

COURT FINES

! Justice of the Peace Courts ! County Courts ! District Courts ! Authority to Assess & Set Amounts ! Fine Collections ! Outside Collections Contracts

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Investment Income

! Public Funds Investment Act ! Investment Policy Required ! PFIA training highly encouraged ! Authorized Investments ! Current Revenues vs. Bond Funds ! Investment Options and Services

OTHER REVENUES AND FUNDING SOURCES

! Miscellaneous Revenues ! Bond Proceeds and Capital Leases ! Fund Balances / Reserves ! Adequacy of Fund Balance/Reserves ! Uses of Fund Balances/Reserves

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FUND AND ACCOUNT STRUCTURE

! General Fund – All Revenues Unless Specified Otherwise

! Road and Bridge Fund ! Special Restricted Funds and Their Sources of

Revenue ! Bond and Debt Proceeds ! Others As Needed

REVENUE MANAGEMENT AND BUDGETING

! Developing a Plan to Insure the Legal, Correct, and Timely Collection of County Revenues

! Budgeting – County Judge in Smaller Counties/Budget Officer or County Auditor in Larger Counties

! Budgeting – Revenue Estimating

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CHANGES IN REVENUES

2013 Revenue Summary for one large county as compared to my small county – ! Property Taxes – 72% ----- 91% ! Intergovernmental – 5% -----1% ! Fees – 8% ----- 6% ! Auto Registration – 4% ----- 4% ! Fines – 2% ----- 1% ! Interest and Misc.– 1% ----- < 1%

CHANGES IN REVENUES

! Causes of the Changes in County Revenues

! Effects and Solutions to Revenue Changes

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SUMMARY AND REVIEW

! Seven Major Types of County Revenues ! Statutory Basis for Revenues ! Special and Limited Use Revenues ! Revenue Budgeting ! Questions??

TYPES OF EXPENDITURES

! Counties provide services ! Required Expenditures ! Some Services are Mandatory, some are

Discretionary ! Funding Levels ! Budgetary Control ! Methods of Service Delivery

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DISCRETIONARY SERVICES WORKSHEET

! Jails (mandatory) ! Courts (mandatory) ! Juvenile Probation(mandatory) ! Adult Probation facilities (mandatory) ! Prosecution (mandatory) ! Indigent Health (mandatory) ! Elections (mandatory)

DISCRETIONARY SERVICES WORKSHEET

! County Auditor/Treasurer (mandatory)

! Debt Service (mandatory) ! Records Management (mandatory) ! Homeland Defense (mandatory) ! Existing Tax Abatements (mandatory)

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DISCRETIONARY SERVICES WORKSHEET

! Future Tax Abatements (discretionary) ! Economic Development (discretionary) ! EMS/Fire (discretionary) ! Law Enforcement (discretionary) ! Public Health (discretionary) ! Roads (discretionary) ! Parks/Community Centers (discretionary)

DISCRETIONARY SERVICES WORKSHEET

! Libraries (discretionary) ! Senior Services(discretionary) ! Family Services (discretionary) ! Community Development (discretionary) ! Employee Benefits (discretionary) ! Health Insurance (discretionary)

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REQUIRED SERVICES

! Maintenance of Roads and Bridges ! Public Safety ! Courts Systems ! Indigent Medical Care ! Issuing & Recording Public Documents ! Elections and Voter Registration ! Public Health ! Vehicle Registration/Titles/Sales Taxes

OPTIONAL SERVICES

! There Must Be Statutory Authority to Provide Services

! Fire Protection ! Emergency Medical Services ! Operation & Maintenance of Parks ! County Hospitals/Hospital Districts ! Solid Waste Facilities and Services

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OPTIONAL SERVICES (cont)

! County Airports ! Industrial/Economic Development ! Mental Health Services ! Libraries

LEVELS OF FUNDING FOR SERVICES

! In Fiscal 2013 and 2004 – One of our larger counties General Fund spending was as follows:

! General Administration – 12.0% - 14% ! Judicial & Legal – 15.0% - 18% ! Financial – 3.0% - 4% ! Facilities – 4.0% - 4% ! Public Safety – 30.0% - 34% ! Health – 3.0% - 5% ! Road & Bridge – 6.0% - 7% ! Debt Service – 21.0% - 12% ! Other – 6.0% - 2%

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LEVELS OF FUNDING FOR SERVICES

In Fiscal 2013 – Large County vs Gaines County General Fund Spending: ! General Administration – 12.0% - 9.7% ! Judicial & Legal – 15.0% - 15% ! Financial – 3.0% - 5.4% ! Facilities – 4.0% - 11% ! Public Safety – 30.0% - 46% ! Health – 3.0% - 6% ! Road & Bridge – 6.0% - 0.1% ! Debt Service – 21.0% - 0.0% ! Other – 6.0% - 4.8%

BUDGETARY CONTROL

Mandated Expenditures: ! Court Related – Attorneys, Interpreters ! Indigent Medical Care ! Elections ! Fixed Costs – Buildings, Utilities, Insurance ! Benefits – Workers Comp & Retirement

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BUDGETARY CONTROL

Mandated Expenditures – Continued ! Jail Prisoner Housing and Care ! Operational Costs – Patrol Cars, Equipment & Building Maintenance ! Minimal Service Levels in Constitutional and Statutory Offices

BUDGETARY CONTROL

! Departments/Funds Outside the Commissioners Court Control:

! County Auditor ! Purchasing Agent ! Juvenile Probation – TJPC ! Adult Probation – CSCD ! Forfeiture Funds

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BUDGETARY CONTROL

! Departments/Funds Outside the Control of Commissioners Court:

! DA/CA Hot Check Fee Fund ! VIT Interest Fund ! Records Management Funds ! Others

Levels of Service to Provide

! A Budgetary Decision for the Entire Court ! Workload Trends are Helpful ! Where Does It Fit in Your Priorities? ! What Can Your County Afford? ! What Can It Not Afford?

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SERVICE DELIVERY

! Options:

! Delivery by County Employees

! Intergovernmental Contracts

! Outsourcing

SUMMARY

! Serving the citizens of the County.

! Prioritizing wants versus needs.

! Consensus building by the Court.