City of Diamond Bar Budget

Fiscal Year 22/23

GLOSSARY


Accounting System - The set of records and procedures that are used to record, classify, and report information of the financial status and operations of an entity.


Accrual - The basis of accounting by which revenues are recorded when earned and expenditures are recorded as soon as they result in liabilities for benefits received.


Agency Fund - An assemblage of funds that one government agency holds on behalf of another government agency.


Appropriation - Money set aside by the City Council for a specific purpose.


Appropriation Limit - The calculated dollar amount that restricts the ability to receive and appropriate proceeds of taxes.


Balanced Budget - A budget in which sources of income (revenue) is equal to spending uses (expenditures).


Baseline Budget - A baseline budget serves as the starting point for City departments' budget, and typically includes initial revenue and expenditure projections.


Beginning/Ending Fund Balance - Unencumbered resources available in a fund from the prior/current year after payment of the prior/current year expenses.


Budget - The City's financial plan for the 12 month period through June, which details spending priorities for the year and how the City will pay for them.


Budget Calendar - The schedule of key dates or milestones, which the City follows in the preparation and adoption of the budget.


Capital Improvement Program (CIP) - Funds used to account for the purchase or construction of major capital projects, which are not financed by proprietary, special assessment or trust funds.


Capital Outlays - Expenditures for the acquisition of capital assets.


Capital Project - Any improvement or acquisition of major facilities with a useful life of at least five years such as roads, bridges, buildings, or land.


Carry-over - Funding approved in the current budget but not expended during a particular fiscal year. These appropriations are carried forward into the next fiscal year for their original intended purpose.


Community Development Block Grants (CDBG) - Funds established to account for revenues from the federal government and expenditures as prescribed under the Community Development Block Grant program.


Cost Allocation - A method used to charge general fund overhead costs to other funds such as an Internal Service Fund.


Debt - An obligation resulting from the borrowing of money or for the purchase of goods and services.


Debt Service - Interest and principal payments on debt issued for major projects.


Department - An organizational unit comprised of programs or divisions.


Encumbrance - A legal obligation to pay funds, an expenditure of which has not yet occurred.


Expense - A cost incurred for operations, maintenance, interest or other charges.


Fee - A general term used for any charge levied by government for providing a service or performing an activity.


Fiscal Year (FY) - A 12-month accounting period that doesn't necessarily correspond to the calendar year. Diamond Bar's fiscal year starts on July 1 and in any given year and ends on June 30 of the following year.


Franchise Fees - Companies are granted special privileges for the continued use of public property, such as city streets. Such companies usually involve elements of monopoly and may require regulation. The Franchise Fees are the amounts required for the continued granting of these privileges. Franchises currently granted within the City are Electric, Gas, Cable TV, Bus Benches, and Waste Hauler.


Full-Time Equivalent (FTE) - A position converted to the decimal equivalent of a full-time position based on 2,080 hours per year.


Fund - A self-balancing set of accounts.


Fund Balance - The amount of financial resources in a given fund that are not restricted to fund existing commitments and are therefore available for any use permitted for the fund.


Gann Limit (Proposition 4) - Under this article of the California Constitution, the City must compute an annual appropriation limit that states a ceiling on the total amount of tax revenues the City can appropriate annually.


General Fund - A general fund typically is the chief operating fund of a government.


Interfund Transfers - Payments from one fund to another fund, primarily for work or services provided.


Internal Service Fund - A fund accounting for centralized services provided to various City departments where the cost is reimbursed.


Operating Budget - The annual appropriation of funds for on-going program costs, which include salaries, benefits, maintenance, operation, and capital outlay items.


Operating Costs - Estimated expenses that can be expected to occur.


PERS or CalPERS - The California Public Employees Retirement System, which is the agency providing pension benefits to all city employees.


Restricted Fund Balance - The part of a fund that is legally limited to a specific use.


Revenue - Sources of income that finance the operations of government.


Sales and Use Tax - As a result of the Bradley-Burns Local Sales and Use tax law, 1% of the Sales & Use Tax is to be distributed to the City.


Special Revenue Funds - A fund that collects revenues that are restricted by the City, State or federal government as the method by which they may be spent.


Transient Occupancy Tax (TOT) - These revenues are received on a monthly basis from the hotels in the City. The hotels are required to pay a 10% tax based on the amount of their room rental revenues.


Unrestricted Fund Balance - The part of a fund not restricted for a specific use and available for general use.


Vehicle License Fee (VLF) - Are collected by the State of California when vehicles are registered with the California Department of Motor Vehicles and distributed to various public agencies, including the City.