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1. Can you please explain the statement at the top of the cover page? It says property tax revenue in this budget is $3M lower than last year however the budget shows property ... (continued below)

Q: Can you please explain the statement at the top of the cover page? It says property tax revenue in this budget is $3M lower than last year however the budget shows property tax revenue is higher by $8M.



A: The cover page of the proposed budget includes a statement required by state law to show the change in property tax revenues due to changes in taxable value and the proposed tax rate. The calculation methodology is applied by the law and does not fully account for the effect of properties in Tax Increment Financing (TIF) districts and how those value increases are allocated between the TIFs and city funds. This calculation is provided to the city by the Dallas County Tax Office.



Per state law, 100 percent of the value of properties within TIF districts is deducted from the city’s change in revenue calculation. However, for all five of Irving’s TIFs, the amount of taxes used for debt service is excluded, and 100 percent of that revenue is available to finance the city’s debt obligations.



Further, each TIF receives only a portion of the increase in revenues from operations and maintenance (O&M) property tax, with the remainder providing revenues to the General Fund. For TIF #1 (Las Colinas) 77.5 percent of O&M tax revenues are deposited into the TIF, with 22.5 percent available to the General Fund. For TIF #2, the split is 65 percent/35 percent, while the split for the three residential TIFs is 50 percent/50 percent.

2. The full cost of salaries and benefits is budgeted at 100 percent. In the past we have budgeted less than 100 percent based on our actual experience each year with ... (continued below)

Q: The full cost of salaries and benefits is budgeted at 100 percent. In the past we have budgeted less than 100 percent based on our actual experience each year with unfilled vacancies and so forth. What has been our experience lately comparing budgeted to actual for these costs? If we budgeted these costs at 97 percent, how many additional dollars would be available for other areas of the budget?

A: Fully funding salary and benefit costs will assist the city in maintaining a fund balance of 30 percent of revenues each year for the city’s Aaa bond rating. Funds in excess of the 30 percent fund balance target are then available to be spent on one-time capital projects, reducing the amount of debt used to fund projects.

Staff generally anticipates 2 percent salary savings each year. Each 1 percent of vacancies budgeted in the General Fund equates to approximately $1.3 million.

3. This budget highlights $30M for streets to be allocated in annual portions beginning in the 2017-2018 budget. Why aren't we starting this in this 2016-2017 ... (continued below)

Q: This budget highlights $30M for streets to be allocated in annual portions beginning in the 2017-2018 budget. Why aren't we starting this in this 2016-2017 budget? Do the statements in this budget about the street allocation in the 2017-2018 budget bind the City Council to actually do this in future years budgets? Where will the money come from to fund the $30M commitment for streets?



A: There is not capacity for additional street bonds in the FY 2016-17 proposed bond sale. The Council is not required to issue the additional $7.5 million in bonds annually for streets from FY 2017-18 through FY 2021-22; it is a decision that will be made each budget year. The total of $37.5 million in bonds over the five years following FY 2016-17 that staff is proposing for streets will be funded within the existing tax rate.



Growth in taxable values has created additional capacity to issue bonds and is projected to continue to create additional capacity. In prior years’ projections, the rate of growth had been estimated at 2 percent. Based on recent trends and future developments, the growth rate was changed to 3 percent. This provided increased capacity for the additional street bonds without increasing the tax rate allocated to debt service. If conditions change, City Council may change the proposed plan.

4. Why was our bond rating for water and sewer bonds downgraded by Moody's?

Increases in operating expenditures without matching increases in rates reduced the city’s coverage factor for water and sewer debt below the goal Moody’s set for Single A credit ratings. Although this is one of many factors used to measure the city’s credit rating, it was far enough below established parameters that the city’s credit rating for Water and Sewer revenue debt was lowered from Aa1 to Aa2.

5. Is the $500K budget allocation for an "innovations center" and the $1M allocation for an "entrepreneurial center" applying to the same project?

The innovation center and the entrepreneurial center are the same project. In the current fiscal year $530,000 was budgeted for capital costs to refurbish a portion of the former Central Library building for this project, but no funds have been spent; these dollars will roll over to FY 2016-17. An additional $530,000 is budgeted for FY 2016-17 for a total of $1,060,000.

6. There is $515K budgeted for a golf tournament and a tennis tournament. $215K is budgeted to be recovered meaning we will spend a net $300K for ... (continued below)

Q: There is $515K budgeted for a golf tournament and a tennis tournament; $215K is budgeted to be recovered meaning we will spend a net $300K for these events. Are there any other budget contributions from any other City funds for these events? Is the $215K recovery guaranteed?



A: In addition to the $515,000 budgeted for the LPGA North Texas Shootout and ATP Irving Tennis Classic in the Economic Development Fund, the Irving Convention and Visitors Bureau sponsors the LPGA event and performs activities during the event with a total proposed budget of $32,000.



The $215,000 recovery from the Texas Events Trust Fund is not guaranteed. It is subject to funding from the state and calculations of economic activity. In the past, the city has been successful at receiving substantial reimbursements from the Texas Events Trust Fund.

7. What is the Heritage Crossing project budgeted for $940K?

The city has budgeted $940,470 for the following programs and incentives in Heritage Crossing (see page

OTHER-7 or in the PDF document page 1075):

• Corridor Enhancement Incentive Program


• Neighborhood Housing Enhancement Incentive Program


• Downtown Façade Enhancement Incentive Program


• Downtown Sign Enhancement Incentive Program


• Heritage Public/Private Partnerships – Downtown Parking


• Texas Musicians Museum Lease Provisions


• Heritage Crossing Incentive Agreement for 400 S. MacArthur Blvd.

8. What makes up the Land and Other Capital costs in the Economic Development fund?

Land and Other Capital in the Economic Development Fund includes:

• Acquisition of excess TxDOT ROW property along Irving Boulevard between Sowers Road and O’Connor Road.


• Second of three installments to repay NCTCOG Land Banking Loan Program for land bank properties purchased in 2010 and 2011.


• Entrepreneurial/Innovation Center.

9. What is the "CEO for Cities" program mentioned in many department budgets? Combining all the budgeted items, what is the total cost for this item?

CEO’s for Cities appears in the Irving Convention and Visitors Bureau (ICVB) budget. It is included in the Travel and Training line item for $15,000 and the Memberships line item for $10,000. This totals to $25,000 for membership to the organization and travel/training opportunities with the organization. CEOs for Cities is a national city-learning network that connects government, education and nonprofit community leaders across sectors and generations throughout North America.

10. The budget mentions a need for dedicated funding for economic development. Why did the City transfer $13M from the ED fund into the General Fund in the ... (continued below)

Q: The budget mentions a need for dedicated funding for economic development (ED). Why did the City transfer $13M from the ED fund into the General Fund in the 2014-2015 budget? If that $13M were still in the ED fund, would we still have the need for more.



A: The $13 million that was in the Economic Development Fund was used by the city to meet fund balance targets needed to maintain the city’s Aaa bond rating. It was not available to be spent. Since the $13 million was needed to maintain fund balance targets and was not available for spending on economic development projects, it was transferred to the General Fund to more appropriately reflect its use as fund balance.



Irving does not have a dedicated mechanism to fund economic development projects. Some cities in North Texas dedicate a portion of their sales tax or property tax revenue to economic development. The Economic Development Strategic Plan and Long Term Financial Plan recommend identifying a consistent and reliable funding source for economic development to help the city remain competitive in the region and promote a vibrant economy.

11. How do our development fees compare to McKinney, Frisco, Southlake, Flower Mound and Plano? Should we increase our commercial development fees because of our diminishing ... (continued below)

Q: How do our development fees compare to McKinney, Frisco, Southlake, Flower Mound and Plano? Should we increase our commercial development fees because of our diminishing supply of developable land? Shouldn't our developer fees be much higher because of our location?



A: Although development fees have not been raised since 2008, the last fee survey showed our rates to be in the middle of regional cities. The one area where we do not charge fees is impact fees. Development fees are a small portion of general revenues, and a fee increase would not result in a significant increase in revenues. Building inspection fees are below average.

12. It appears general fund spending in this budget is increasing by $18M. Am I reading that right?

From FY 2015-16 Adopted Budget to FY 2016-17 Proposed Budget, General Fund expenditures are increasing by $6,761,585 (3.13 percent). See page INTRO-8.

13. How was the payment to Comerica Bank funded that paid off the Heritage Crossing debt? Were there bonds sold to do that? Were the bonds sold as water ... (continued below)

Q: How was the payment to Comerica Bank funded that paid off the Heritage Crossing debt? Were there bonds sold to do that? Were the bonds sold as water and or sewer bonds? How much is the annual debt service payments attributable to the Heritage Crossing related debt? Where is it being paid from and why from that source?



A: In FY 2011-12, special revenue debt was issued to finance the Heritage Crossing debt and pay off the amount owed to Comerica Bank. This debt was issued with a pledge of Solid Waste Services revenues. However, since this debt was not attributable to Solid Waste Service operations, the debt has been and is budgeted to be paid from General Fund revenues. The debt payments are separate from other general obligation debt of the city and is shown in a separate debt service fund. For FY 2016-17, principal and interest payments on this debt are $2,478,783. The debt payment will be at approximately this level for the remaining 16-year term of the debt.

14. How much of the 19 percent increase in the sewer rates can be attributed to increased charges from the Trinity River Authority (TRA)? Is there documentation of that somewhere for the public?

Both water and sewer rates are proposed to increase by 7 percent. TRA increased its charges to the city for sewer treatment by $1 million – which is about 21 percent of the total expenditure increases in Water Utilities.

15. Residential property values have risen this year in Irving by 6.9 percent. If I have the average valued home, does that mean if the Council maintains the current rate ... (continued below)

Q: Residential property values have risen this year in Irving by 6.9 percent. If I have the average valued home, does that mean if the Council maintains the current rate, without an increase, that my tax bill could rise by 6.9 percent?



A: Yes.

16. The budget mentions the new housing developments in North Irving as the reason for the need for new trash routes, more equipment and staff for ... (continued below)

Q: The budget mentions the new housing developments in North Irving as the reason for the need for new trash routes, more equipment and staff for service, etc. These homes were built with $30M of taxpayer advance funding, which we borrowed by selling taxpayer-backed bonds. Are there any net tax revenues, after the debt service payments, coming from these homes that can cover the costs for City services to the homes?



A: Solid Waste Services operates as an enterprise fund of the city, with all operating, capital and other expenses funded from user fees and related revenues.



The General Fund receives 50 percent of new taxes for the operations and maintenance portion of the tax rate, and the interest and sinking fund receives 100 percent of the new taxes for the debt service rate from these areas. These revenues assist in the cost of other city services and the retirement of city-wide general debt.