Budget Glossary

The Annual Budget contains specialized and technical terminology that is unique to public finance and budgeting. To assist the reader of the Annual Budget document in understanding these terms, a budget glossary has been included in the document.

Ad Valorem Tax: A tax levied on the assessed value of real property (also known as "property taxes”).

Assessed Value: A value set upon real estate or other property by the Uvalde County Appraisal District as a basis for levying taxes.

Audit: A financial audit is a review of the accounting system and financial information to determine how government funds were spent and whether expenditures were in compliance with the legislative body’s appropriations.

Appropriations: A legal authorization made by the City Council which permits City officials to incur obligations for a specific purpose.

Assessed Valuation: A value established by the Uvalde County Appraisal District which approximates market value of real property. By state law one hundred percent 100%) of the property value is used for determining the basis for levying property taxes.

Balanced Budget: A budget in which estimated revenues equal estimated expenditures. Undesignated Fund Balance monies may be used to balance the budget.

Beginning Balance: The residual non-restricted funds brought forward from the previous fiscal year (ending balance).

Bond: A written promise to pay a sum of money on a specific date at a specified interest rate. The interest payments and the repayment of the principal are detailed in a bond ordinance. The most common type of bonds are general obligation (G.O.) and revenue (Water/Sewer) bonds. These are most frequently used for construction for large capital projects, such as buildings and streets.

Budget: A financial plan for a specified period of time (fiscal year) that matches planned revenues and appropriations. The budget process in every Texas City must comply with the requirements of the Texas Uniform Budget Law. See description of Budget Process.

Budget Policies: General and specific guidelines approved by the City Council that govern various aspects of the budget process, including the formulation of the budget document, its implementation and reporting procedures utilized to monitor its progress during the fiscal year.

Capital Improvement Program: A comprehensive plan which projects the capital needs of a community. The plan for capital expenditures is to be incurred each year over a fixed period of several future years setting forth each capital project, the amount to be expended in each year and the method of financing those expenditures.

Capital Outlay: Expenditures for equipment, vehicles, and machinery that result in the acquisition of assets with a useful life of more than one year.

Contingency Account: The appropriation of reserve funds for future allocation in the event specific budget allotments have expired and additional funds are needed.

Debt Service: The City’s obligation to pay the principal and interest of general obligation and revenue bonds according to a predetermined payment schedule.

Debt Service Funds: Used to account for the accumulation of resources for, and the payment of, general long-term debt principal and interest.

Delinquent Taxes: Real property taxes that remain unpaid on and after February 1st of each year upon which penalties and interest are assessed.

Department: A major administrative segment responsible for management of operating division which provide services within a functional area.

Encumbrances: Commitments related to unperformed contracts for goods or services. To encumber funds means to set aside or commit funds for future expenditures.

Enterprise Funds: A governmental accounting fund in which the services provided are financed and operated similarly to those of a private business. The rate schedules for these services are established to ensure that revenues are adequate to meet all necessary expenditures. The sole enterprise fund for the City of Uvalde is the Utility/Sanitation Fund.

Estimated Revenue: The amount of project revenue to be collected during the fiscal year.

Expenditure: Funds spent in accordance with budgeted appropriations on assets or goods and services obtained.

Fiscal Year: The time period designated by the City signifying the beginning and ending period for recording financial transactions. The City of Uvalde has a fiscal year of October 1st through September 30th as established by the City Charter.

Fixed Assets: Assets of long-term character such as land, buildings, machinery, furniture and other equipment.

Franchise Fee: A fee paid by public service businesses for use of City streets, alleys and property in providing their services to the citizens of a community. Services requiring franchises include electricity, telephone, natural gas and cable television.

Fund: An independent set of accounting records which are separated for the purpose of carrying on an activity in conformity with regulation of a “not for profit” business. In the budget process a formal Annual Budget is required for all City Funds.

Fund Balance: Fund balance in the excess of assets over liabilities.

General Fund: The largest fund within the city, the General Fund accounts for the majority of the financial resources of the government. General Fund revenue includes property taxes, sales taxes, licenses and permits, service charges, and other types of revenue. This fund includes most of the basic operating functions such as fire and police protection, municipal court, finance, planning and inspection, public works, parks and recreation, and general administration.

General Obligation Bonds (G.O.): Legal debt instruments which furnish a variety of public projects such as streets, buildings, and improvements. These bonds are backed by the full faith and credit of the issuing government and are financed through property tax revenues. In Texas, G.O. bonds must be authorized by public referendum.

Governmental Funds: Those funds through which most governmental functions typically are financed. The acquisition, use, and financial resources and the related current liabilities are accounted for through governmental funds (General, Special Revenue, Capital Projects, and Debt Service Funds).

Grant: A contribution of assets (usually cash) by one governmental unit or other organization to another. Typically, these contributions are made to local governments from state and federal governments. Grants are usually made for the specified purposes.

Intergovernmental Revenue: Grants, entitlements, and cost reimbursements from another federal, state, or local government.

Line Item: A specific item or group of similar items defined by detail in a unique account in the financial records.

Levy: The City Council has authority to impose or collect taxes, special assessments, or service charges as stated in the City Charter.

Maintenance: Cost of upkeep of property or equipment.

Maturities: The dates on which the principal or stated values of investments or debt obligations mature and may be reclaimed.

Occupancy Tax: A city tax on hotel/motel room rentals often called the “Bed Tax.”

Operating Transfers: Monies transferred between funds.

Ordinance: A formal legislative enactment by the governing body of a municipality. If it is not in conflict with any higher form of law, such as state statute or constitutional provision, it has the full force and effect of law within the boundaries of the municipality to which it applies.

Personal Services: Cost related to compensating employees, including salaries, wages, insurance, payroll taxes, and retirement contributions.

Property Tax: Taxes levied on all real, personal property according to the property’s valuation and the tax rate, in compliance with State Property Tax Code.

Revenue: Funds received by the government as income, including tax payments, fees for specific services, receipts from other governments, fines and forfeitures, grants and interest income.

Revenue Bonds: Legal debt instruments which finance public projects for such services as water or sewer. Revenues from the public project are pledged to pay principal and interest of the bonds. In Texas Revenue Bonds may or may not be authorized by public referendum.

Services: Professional or technical expertise purchased from external sources.

Supplies: Cost of goods consumed by the city in the course of its operations.

Tax Levy: The total amount to be raised by general property taxes.

Tax Rate: The amount of tax levied for each $100 of assessed value for real property. The rate is set by October 1st of each year by the City Council of the City of Uvalde.

Taxes: Compulsory charges levied by a government for the purpose of financing services performed for the common benefit.

Transmittal Letter: A general discussion of the proposed budget presented in writing as part of the budget document. This letter explains principal budget issues against the background of financial experience in recent years and presents recommendations made by the City Manager to the City Council.

Unreserved Fund Balance: Undesignated monies available for appropriations