Investments – The investment policy is annually updated and approved by Council in complianc e with the Texas Public Funds Investment Act. All investments are made in conformity with the Council approved policy.
Expenditures
Debt Capacity, Issuance and Management – Long-term debt will not be used for operating purposes. Capital projects financed through bond proceeds shall be financed for a period not to exceed the useful life of the project. When appropriate, self-supporting revenues will pay debt service in lieu of property taxes. The current fiscal year Debt Service requirement shall not exceed debt service property tax revenue, self-supporting revenue and balances carried forward from the prior year. The debt per capita should be within norms based on a survey of comparable cities. Unspent capital project proceeds are transferred to debt service at the completion of the capital project. The City Charter provides that the City Council may not exceed the voter – authorized limit on any bond project. Other debt management policies are detailed in the City’s Adopted Debt Management Policy. Financial Reserves – In order to protect the City in cases of disasters, emergencies, and other unforeseen circumstances requiring significant unplanned expenditures, the City shall maintain a prudent level of financial resources in the form of unassigned fund balances in the general fund and also in other operating funds (e.g., the enterprise funds). The Finance Department shall work with the City Manager’s Office and the DeSoto City Council to reach and maintain targeted levels of financial reserves. Unassigned fund balance (as defined by the Governmental Accounting Standards Board) in the various operating funds shall be maintained at the levels prescribed in the following table: Fund Minimum Target Maximum General Fund 35% 45% 50% Public Utility Fund 20% 30% 35% Drainage Fund 16% 25% 30% Sanitation Fund 10% 15% 20% SWRCC 10% 15% 20% The indicated percentages shall refer to the annual budgeted operating expenditures (exclud ing capital, debt, and transfers to other funds) for the current Fiscal Year in the General Fund only. All other funds’ percentages will be based on total appropriations. Sources of reserves will most commonly be higher-than-budgeted levels of revenue, lower-than-budgeted levels of expenditure s, or nonrecurring unappropriated revenues. Such reserves will also generate additional interest income, reduce the need for short-term borrowing, and assist in maintaining an investment-grade bond rating. Calculation and projections to ensure compliance shall be undertaken during the annual budgeting process. Also, periodically throughout the Fiscal Year, the Finance Department shall monitor revenues, expenditures, and levels of unassigned fund balance to verify on-going compliance. Reserves in excess of the target levels designated above may be used for one time investments such as:
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