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Organizational Chart for FY 2022-2023CitizensMayor and CityCouncilBoards andCommitteesMain StreelFire DepartmentCity AttorneyPoliceDepartmentCity ManagerLibrary ServicesCity JudgeDevelopmentServicesCity SecretaryPublic WorksParksKeep Pilot PointBeautifulFinanceEMSPatrolLibrary ServicesPlanning andDevelopmentStreets & TrafficSignsFire FightingInvestigation(CID)Senior CenterBuilding &Health PermitsDrainagePayrollAnimal able/Accounts ReceivableCapitalInfrastrucutreInspectionsUtility BillingAccountingMunicipal Court817

Boards and CommissionsBoard of AdjustmentThe Board of Adjustment hears and determines appeals of administrative decisions and requests for variances in thecase of peculiar and unusual circumstances which would prevent the reasonable use of land and such other mattersas may be required by the City Council or by law.Capital Improvements CommitteeThe Capital Improvements Committee is an appointed to advise and assist the political subdivision in adopting landuse assumptions, review and monitor the capital improvements plan, and advise the political subdivision of the needto update or revise the land use assumptions, capital improvements plan, and impact fee.Economic Development FoundationThe Economic Development Foundation is a non-profit organization that assists business and industry in locatingand expanding into a community.Library and Cultural Arts Advisory BoardThe Library Advisory Board advocates for Library support, promote and library services, and Programs. As well asassist the library management in developing policies and budget proposals.Main Street Advisory BoardThe Main Street Advisory Board will assist the Main Street Director in fundraising for Main Streets Programs andassisting with Special Events that are organized through the Main Street Department. As well as makerecommendations as to Main Street Policies and set goals for Main Street Projects.Municipal Development DistrictA Municipal Development District is a special purpose district created for the purpose of generating economicdevelopment and growth opportunities within the boundaries of the districtParks and Recreation BoardThe Parks and Recreation Board is an advisory body to the City Council on the planning and development of parksand recreational facilities and the regulations governing their use.Planning & Zoning CommissionThe Planning and Zoning Commission is an advisory body to the City Council that makes recommendationsregarding the administration of the zoning ordinance, and the development of the comprehensive plan for thephysical development of the city. Other duties include regulating zoning and ordinance amendments and platting.918

2022-2023 Budget MessageAugust 2, 2022Mayor and City CouncilCity of Pilot Point, TexasFY 2022-2023 Recommended BudgetTo Mayor Pro Tem Chad Major and City CouncilThe formation of an annual budget is set via the Pilot Point City Charter section 7.02 and the lawsof the State of Texas governing home rule cities. This year’s budget focuses on our most valuableasset, our employees. Throughout the following pages you will find a dedication to our employeesthrough pay increases and increases in training and education budget lines. The continuedreinvestment we have put into our staff has resulted in a lower turnover which results in an overallbetter performance and ability to serve the citizens of Pilot Point. Because of the action you asCity Council took this past fiscal year, we do not have many new capital projects; however, wewill have approximately 50 million worth of water and sewer projects, that are funded throughbond proceeds. The staff and I have worked together and are pleased to submit for your reviewand consideration, the Fiscal Year 2022-2023 Proposed Budget.Formation of the BudgetThe Proposed Budget is developed through an extensive process of meetings with departmentheads, reviewing requests received by city departments, and then prioritizing those requests in amanner that utilizes resources effectively, within fiscal constraints, while working to achieve thecity’s goals. A budget calendar with important deadlines ensures we meet dates within the process.Important upcoming dates: 08/11/2022 – Budget Workshop Before Council and Fourth Budget Meeting 09/01/2022 – Special Called Meeting Public Hearing on Budget & Tax Rate 09/08/2022 – Adoption of Budget and Tax Rate 09/30/2022 – Final Date to Adopt BudgetThe City’s fiscal year is October 1 through September 30. The September 8th Council Meeting isthe scheduled day to adopt the budget and tax rate to ensure that we have time before the final dayto adopt the budget.Proposed Tax RateThis budget is based on a voter approved tax rate of 0.626846/100. The voter-approval tax rateis the highest tax rate that a taxing unit may adopt without holding an election to seek voterapproval of the rate. The voter-approval tax rate is split into two separate rates: Maintenance and Operations (M&O) Tax Rate: The M&O portion is the tax rate that isneeded to raise the same amount of taxes that the taxing unit levied in the prior year plusthe applicable percentage allowed by law. This rate accounts for such things as salaries,utilities and day-to-day operations1019

Debt Rate: The debt rate includes the debt service necessary to pay the taxing unit's debtpayments in the coming year. This rate accounts for principal and interest on bonds andother debt secured by property tax revenue.This proposed tax rate will decrease the property tax rate by 1.48%.Water/Sewer RatesFY 2023 is the final year of a 5-year plan to increase water and sewer rates. In this last year of theplan rates were suggested to increase 4%. After evaluating the water and sewer rates for the city,we are recommending not increasing rates. We are also following up on a citizen request to reevaluate the sewer rates with a winter average and are reducing the top end of sewer consumption,which will have a similar effect as a winter average. The city council has already taken steps toincrease the fees for access (tap) fees and meters as we have seen significant increases in the costto the city.FundsCity departments operate generally out of 2 funds, the General fund and the Water and SewerFund. The City General Fund provides what most citizens consider to be basic city services. Theseinclude Administration, Police, Fire/EMS, Parks, Streets & Drainage, Development Services,Library, Senior Center, Municipal Court, Code Compliance and Animal Control. Public Safetyaccounts for 49% of the general fund budget.The Water and Sewer fund is the other fund that city departments operate out of. Revenues fromthis fund are generated from utility bills and fund the water, wastewater, and utility billingdepartment.Budget HighlightsPayback to the reserves –The Pilot Point City Charter requires a twenty-five percent reserves forour general fund. Two years ago, we made a commitment to increase our reserves, and we continueto make progress toward that goal. This year we expect to go from a 10% reserve to a 14% reserve.Market Rate Pay Increase – This year’s budget is proposing market rate increases to alldepartments. We surveyed municipalities designated by council last year as comparison cities andfound that many of our positions continue to be well below market. Knowing the market averageand taking steps to be on market average are important because it influences so many aspects inthe overall success of our city. Some positive benefits of a competitive pay rate include higheremployee morale, achievement is higher, recruitment is easier, and turnover is lower.ChallengesOne of the biggest challenges we must overcome this year is an 18% increase in health insurance.Insurance rates have surged across the state with many cities seeing increases in the double digits.We are experiencing increased costs across the board especially in gas and building materials.Finally, the loss of the SRO contract means we are fully funding the three officers, vehicles, andsupplies.ProjectsMultiple projects will be carried over from last year. The water projects are part of the CO bondseries that Council passed in FY 22, and the Sewer projects are part of an ongoing application tothe Texas Water Development Board Clean Water State Revolving Fund.1120

1 MG Burks Street Elevated Water Storage Tank12” Watermain from Berend Well north 377 8”12” Watermain from Berend Road to Burks 8”12” Watermain from W. Main to West of Montague w/ Railroad Bore12” Watermain from Washington to North Dallas w/Railroad Bore12” Watermain from Prairie/Church to Fire StationWater System SCADA Upgrade1.5 MGD Wastewater Treatment PlantMultiple Sewer main upgradesConclusionIn closing, we have made great progress over the last two years, and I believe the budget laid outin the following pages accomplishes needed funding while leveling out utility bills and loweringthe tax rate. The annual budget process is both challenging and highly anticipated each year. Thestaff have worked hard to ensure the huge undertaking that is the annual budget meets the needsof their departments while not excessively increasing any one budget line. The growth that iscoming to Pilot Point is both exciting and challenging.I would like to thank Michele Sanchez, Finance Director, for the time and dedication she has putinto this budget. I would also like to acknowledge our Department Heads for their input throughoutthe process.Finally, I would like to thank the City Council and the residents of Pilot Point for the privilege ofserving as your City Manager. It is a role that I do not take lightly and appreciate the confidenceyou have placed in me to serve in this capacity.SincerelyBritt M LuskCity Manager1221

FY 2022-2023 Budget Overview General FundReserve Fund BalanceThe importance of cash reserves, generally identified as Reserve Fund Balance, cannot be stressed enough in anygovernmental function. The ability to overcome unexpected disasters or to be able to fund an unbudgetedexpenditure that may be significant to the City requires available but unencumbered funds. The estimated reservebalance at the end of FY 2021-22 is 807,520.The table below provides a listing of the ending reserve fund balances for the previous fiscal year, budgeted andprojected ending fund balance for FY 2021-2022, and the proposed ending fund balance for FY 2022-2023. CityManagement will continue to monitor our financial performance and make appropriate expenditure and/or revenueadjustments as necessary to manage the reserve fund balance.DescriptionActualFY 19-20Fund Balance, Beginning561,443Fund Balance, Ending506,498.Fund Balance as % of Expenditures12%ActualFY 20-21506,498508,1739%ProjectedFY 21-22508,1731,028,883.9418%ProposedFY 22-231,028,883.941,107,775.3816%Bond RatingThe city has a Standard and Poor’s Bond Rating of AA- (double A minus). This rating means the City has verystrong capacity to meet its financial commitments and it differs from the highest rating (AAA) only to a smalldegree. There are three major rating agencies that evaluate municipalities and their bond: Standard and Poor’s(S&P), Moody’s, and Fitch. They assign municipal bonds a credit rating making it easier for market participants toevaluate risk. A credit rating performs the same service for institutional borrowers and investors. A bond’s creditrating is the rating agency’s opinion as to the creditworthiness of the bond’s issuer (City) and is often the singlemost important factor affecting the interest cost on bonds.Ratings agencies consider all the economic characteristics of the City and the bond issue in assigning a rating. Theyevaluate the economic well-being of the City including: the median income, the community’s dependence on certainemployers or industries, the diversity of the tax base, the rate of population growth, tax revenue trends, tax rates, andreserve fund balance.1322

RevenuesProperty TaxApproximately 31% of the total General Fund revenue is generated from ad valorem taxes. The certified value forFY 2022 – 2023 is 408,196,599, which is an 9.39% increase from last year’s value. Analysis of the increase showsthere was 21,862,707 in new value added to the appraisal roll for new property added.The FY 2022-2023 Budget includes a decrease in the overall tax rate of .009. The proposed tax rate of 0.626846/per 100 of assessed evaluation is above the No New Revenue tax rate of 0.563302/ per 100 assessed evaluationof the proposed tax rate, 0.426846 is provided for Maintenance and Operations (M&O), and 0.20000is providedfor the Interest and Sinking (I&S) or debt service. The rate for the M&O decreased 0.0159 and the rate for the I&Sincreased 0.0065.Tax Rate History0.70.60.5571990.5 320.20.127870FY2016-2017 FY2017-2018 FY2018-2019 FY2019-2020 FY2020-2021 FY2021-2022 FY2022-2023M&OI&STotalSales TaxThe third largest revenue source in the General Fund is sales tax. The FY 2021-2022 year-end estimate of 1,271,033 is 11.8% greater or 146,033 above budgeted revenue. The FY 2022-2023 Budget projects that sales taxrevenues are going to increase due to the opening of additional commercial business and the additional sales taxrevenue.Development ServicesRevenue in development services is projected to be the highest revenue source for the FY2022-2023 budget. Therevenue projections are based on the issuance of 441 new residential permits and are budgeted conversative for thatamount.1423

Water and Sewer FundFund 2RevenuesWater Revenue: Water revenue is expected to small increase over the next fiscal year, with the additional lots beingbuilt every day, and new accounts coming online very consistently throughout the fiscal year. Staff is also notrecommending an increase in water rates.Sewer Revenue: Sewer revenue is expected to increase over the next fiscal year, there are additional lots being builtevery day, and new accounts coming online very consistently throughout the fiscal year. Staff is not recommendingan increase in sewer rates. Reduced sewer caps, are going to be put into place, lowering the amount of waterconsumption that is used to calculate sewer rates.Other Revenues:Water & Sewer Taps: When a new connection for water and sewer is established there are required to pay a tap fee.This revenue is expected to increase with the all the additional building permits and certificate of occupancy that arebeing issued through development services.Residential 4.2835.9135.9137.7037.7Sewer1524

General FundResource & Expenditure SummaryAd valorem taxesSales and Use TaxFranchise FeesDevelopment Services FeeCourt FinesCharges for ServiceGrants/CountyOther RevenueTransfers and InterestActualFY ctualFY tedFY ectedFY roposedFY tal tKeep Pilot Point BeautifulPermits And DevelopmentLibraryParksMain StreetNon-Departmental ExpensesHome ProgramDrainage DeptCourtCommunity CenterMuseumAnimal ControlCode ,122.275,669,528.96Total 9016,500.0010,200.00106,669.117,023,201.561625

Water And Sewer FundResource & Expenditure SummaryActualFY 2020ActualFY 2021AdoptedFY 2022ProjectedFY 2022ProposedFY 2023Water 07.184,562,100.00Total 3SewerUtility BillingTotal Expenses1726

General FundRevenue PercentagesGrants/County , 2% Other Revenue , 1%Transfers and Interest, 4%Charges for Service ,4%Court Fines , 1%Ad Valorem Taxes ,31%DevelopmentServices Fees , 34%Sales and Use Tax ,18%Franchise Fees , 5%1827

General FundExpenditures PercentagesDrainage3%Community Center0%Court MuseumCode Compliance0%1%2%Administration14%Main Street1%Parks4%Library4%Development Services15%Police26%Keep Pilot Point Beautiful0%Streets7%Fire/EMS23%1928

PersonnelThe full-time equivalents (FTE) will increase by six to 71.City Personnel:Department Personnel Full Time Equivalents (FTE)FY 2021-2022ActualFY 2022-2023ProposedAdministrationPoliceFire / EMSStreetsDevelopment ServicesLibraryParksMain StreetDrainageCourtCode ComplianceWater**Sewer*

NOTICE OF REGULAR COUNCIL MEETING CITY OF PILOT POINT CITY COUNCIL MEETING A. ROLL CALL/CALL TO ORDER B. PLEDGE TO FLAGS 1. United States of America 2. Texas Flag Honor the Texas Flag, I pledge allegiance to thee,