FY2018 Council Budget Work Session. August 17, 2017

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Merilyn Ursula Wood
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1 FY2018 Council Budget Work Session August 17, 2017

2 Agenda Overview Assessed Value Breakdown TIF & 380 Agreements Recommended Tax Rate Budget Highlights Health Insurance Plan Changes and Update Pension Strategy and Update Code Enforcement and Police Workforce Study Water and Sewer Budget Rates 2

3 Assessed/Taxable Values Billions Millions $90 $80 Total Assessed Value and Adjusted Net Taxable Value $ $ $800 $750 $700 $70 $60 $50 $40 $ $ $352 $ $ $362 $ $ $404 $ $ $476.7 $428 $458.7 $650 $600 $550 $500 $450 $400 $350 $ Total Assessed Value Adj Net Taxable Value Budgeted Property Tax Revenue Current Rate $300 3

4 Increased Taxable Value Residential New Growth $817,796,622 13% Increased Assessment $4,463,472,443 69% Commercial New Growth $1,148,183,171 18% 4

5 $ $ $ $ $ $ Total Tax Rate $ $ $ $ $ $ Tax Rate Allocation History $ $0.899 $ $ Environmental Fees established 1995-CCPD established Stormwater Fee established $0.855 $0.835 $0.805 $ $ $ $ $ $ $ $ Prop 5 Solid Waste Collection Fees established in 1982 Debt Service Tax Rate Operating Tax Rate

6 Tax Rate Comparison DFW Metroplex (Top 15) $ $ $ $ $ $ $ $ $ $ Fort Worth Dallas Garland Mesquite Denton Grand Prairie Arlington Richardson Carrollton Irving McKinney Allen Plano Frisco Lewisville $ $ $ $ $ $ $ $ $ $ FY2017 FY2018 Proposed

7 Tax Rate Comparison Texas Cities (Top 10) $ $ $ $ $ $ $ $ $ $ Fort Worth El Paso Dallas Arlington Laredo Corpus Christi Houston San Antonio Plano Austin $ $ $ $ $ $ $ $ $ $ FY2017 FY2018 Proposed

8 $120,000 Household Taxing Units 26 City of Fort Worth 905 Fort Worth ISD 220 Tarrant County 224 Hospital District 225 TCCC District 223 Regional Water Dist Home Value $120,000 $120,000 $120,000 $120,000 $120,000 $120,000 $120,000 Exemption 1 Homestead 20% $24,000 Homestead Other $25,000 $120,000 Household in Fort Worth Taxable Value $96,000 $95,000 $120,000 $120,000 $120,000 $120,000 Total Rate M&O I&S Total Est. Property Tax Due $773 $1,284 $293 $273 $174 $23 $2,820 Percentage of Total Bill 27% 46% 10% 10% 6% 1% 100% 1 Rates & Exemptions: Rates for City and county are proposed. 8

9 $150,000 Household Taxing Units 26 City of Fort Worth 905 Fort Worth ISD 220 Tarrant County 224 Hospital District 225 TCCC District 223 Regional Water Dist Home Value $150,000 $150,000 $150,000 $150,000 $150,000 $150,000 $150,000 Exemption 1 Homestead 20% $30,000 Homestead Other $25,000 $150,000 Household in Fort Worth Taxable Value $120,000 $125,000 $150,000 $150,000 $150,000 $150,000 Total Rate M&O I&S Est. Property Tax Due $966 $1,690 $366 $342 $217 $29 $3,610 Percentage of Total Bill 27% 47% 10% 9% 6% 1% 100% Total 1 Rates & Exemptions: Rates for City and county are proposed. 9

10 $300,000 Household Taxing Units 26 City of Fort Worth 905 Fort Worth ISD 220 Tarrant County 224 Hospital District 225 TCCC District 223 Regional Water Dist Home Value $300,000 $300,000 $300,000 $300,000 $300,000 $300,000 $300,000 Exemption 1 Homestead 20% $60,000 Homestead Other $25,000 $300,000 Household in Fort Worth Taxable Value $240,000 $275,000 $300,000 $300,000 $300,000 $300,000 Total Rate M&O I&S Est. Property Tax Due $1,932 $3,718 $732 $684 $434 $58 $7,558 Percentage of Total Bill 26% 49% 10% 9% 6% 1% 100% Total 1 Rates & Exemptions: Rates for City and county are proposed. 10

11 Average Home Value Rate Comparison Variable FY2017 Adopted Tax Rates Average Home Value FY2018 Proposed Tax Rates 3% Value Increase 5% Value Increase 8% Value Increase 10% Value Increase Home Value $174,846 $174,846 $180,091 $183,588 $188,834 $192,331 Exemption Homestead 20% $34,969 $34,969 $36,018 $36,718 $37,767 $38,466 Taxable Value $139,877 $139,877 $144,073 $146,871 $151,067 $153,864 Total Rate M&O I&S Est. Property Tax Due $1,168 $1,126 $1,160 $1,182 $1,216 $1,239 Variance from FY2017 ($42) ($8) $14 $48 $71 Average Market Value : TAD Certified Totals Report - Entities Residential Graph Report 11

12 Top 10 Taxpayers $550 $500 Total Taxable Value (Millions) $450 $400 $350 $300 $250 $200 $150 $100 $50 $0 Alcon Laboratories American Airlines Inc Oncor Electric Delivery Winner (Facebook) Bell Helicopter Textron AT Industrial Owner DDR/DTC City Investments Wal-Mart Miller Coors Behringer Harvard Burnet Plz 12

13 Top 10 Commercial Taxpayers $450 $400 Total Taxable Value (Millions) $350 $300 $250 $200 $150 $100 $50 $0 American Airlines Winner (Facebook) DDR/DTC City Investments Wal-Mart Stores AT Industrial Owner 7 Behringer Harvard Burnett Plz Carlyle/Cypress West 7th F7 SSSM LLC Bell Helicopter Textron Ben E Keith 13

14 Top 10 Industrial Taxpayers $450 $400 Total Taxable Value (Millions) $350 $300 $250 $200 $150 $100 $50 $0 Alcon Laboratories Bell Helicopter Textron Miller Coors Dannon Company Hydra-Rig Ball Metal Beverage Container Mother Parker's Tea & Coffee Cott Beverages Westrock CP Williamson Dickie 14

15 Top Tax Payers with 380 Incentives American Airlines Bell Helicopter Textron Dannon Facebook Wal-Mart 15

16 380 Incentive Payments Impact Incentive FY 2017 Budget FY 2018 Est Payment Variance Real Property Tax 4,388,947 6,312,676 1,923,729 Business Personal Property Tax 2,737,977 2,676,464 (61,513) Sales Tax 4,264,363 5,845,163 1,580,800 Hotel Occupancy Tax 3,850,731 3,844,817 (5,914) Electricity Franchise Fee - 577, ,166 15,242,017 19,256,286 4,014,268 16

17 TIFs Total Estimated Contributions FY2018 TIF 2A & 2B Speedway * TIF 3 & 3A Downtown $ 3,440,653 TIF 4 Southside $ 3,575,315 TIF 6 Riverfront ** TIF 7 & 7A North Tarrant Parkway $ 6,179,539 TIF 8 Lancaster $ 1,288,745 TIF 9 & 9A Trinity River Vision $ 2,301,391 TIF 10 & 10A Lone Star $ 678,174 TIF 12 East Berry Renaissance $ 608,803 TIF 13 Woodhaven $ 792,551 TIF 14 Trinity Lakes $ 859,656 TIF 15 Stockyards/Northside $ 90,292 Total Estimated Contributions $ 19,815,120 Increase of $2.4M *No further obligations by City and no further contributions to TIF **City does not participate 17

18 Financial Modeling Part of each annual planning retreat This past February, we provided a financial model that illustrated: 4% property tax revenue & sales tax revenue growth An increase in allocation to PAYG capital Met capital and other priority obligations 18

19 Budgeted Property Tax Revenue Millions Budget Property Tax Revenue $470 $450 $430 $ $ $ $410 $404 $390 $385 $370 $362 $ Current Rate Effective 8% Rollback Recommended 19

20 Balancing Goals & Priorities (Why the 3 ) Fund commitments and new facilities Maintain debt service revenue growth at 4% or more Contribute more dollars to capital (PAYGO) Reduce the property tax rate 20

21 Policy Choices Allocating more to capital: PAYG cash: 6.50???? Debt service: Maintain funding increase funding Allocating property tax revenue growth to departmental requests Requests well exceeded available revenues Reducing the property tax rate Allocating to other needs, such as transit 21

22 Work To Be Done in FY218 Workforce analysis Police Department Code Compliance Department Review and action on employee benefits Leave policies Pension Multiyear healthcare strategies 22

23 Thank you

FY 2017 COUNCIL BUDGET WORK SESSION AUGUST 25, 2016

FY 2017 COUNCIL BUDGET WORK SESSION AUGUST 25, 2016 1 Total Assessed Value & Adjusted Net Taxable Value Billions $80 $75 $74.907 $800 $750 Millions Assessed/Taxable Values $70 $65 $60 $55 $50 $45 $40 $61.220