Finance Department


Introduction

The 2022-2023 Budget is presented in an easy-to-read format and should be interesting to readers. The budget message from the City Manager to the Mayor, City Council and Citizens of Fredericksburg outlines the business plan for the 2022-2023 fiscal year.

The budget is one of the most important policy documents provided by the City. It is a document that can help a citizen understand the factors that affect the programs and services provided to the public. It serves multiple purposes, including:

  • Policy document – The budget document defines the goals and strategic plan established by the City Council and the objectives of each department to accomplish these goals.
  • Financial plan – The budget document provides a financial plan that includes both summary and detail information on revenues and expenditures to ensure that the City operations are funded, and reserves are maintained in accordance with the financial management policy.
  • Operations guide – The budget document provides detailed objectives for each of the City’s departments.
  • Communication device – The budget document communicates additional information on City operations to the public.

Basis of Accounting

The basis of accounting is the method by which revenues and expenditures are recognized in the accounts and reported in the financial statements. The basis of accounting relates to the timing of the measurements made, regardless of the measurement focus applied. All governmental funds for the City of Fredericksburg are accounted for using the modified accrual basis of accounting. Revenues are recognized when they become measurable and available as net current assets.

Basis of Budgeting

The annual budget is adopted on a basis consistent with Generally Accepted Accounting Principles (GAAP). Governmental fund type budgets are prepared on a modified accrual basis. Governmental revenues are budgeted when they are measurable and available, and expenditures are budgeted in the period in which the liability is incurred. All proprietary funds are budgeted using a flow of economic resources measurement focus and use the accrual basis of accounting. Revenues are budgeted when they are earned and measurable and expenses are budgeted in the period in which the liability is incurred.

Financial Structure

The City of Fredericksburg accounts are organized based on funds and account groups, each of which is considered a separate accounting entity. The operations of each fund are accounted for with a separate set of self-balancing accounts that comprise its assets, liabilities, fund balance, revenues, and expenditures or expenses, as appropriate. Government resources are allocated to and accounted for in individual funds based upon the purposes for which they are to be spent and the means by which spending activities are controlled.

Fund Balance

In accordance with the requirements of the Governmental Accounting Standards Board (GASB), the City of Fredericksburg describes fund balance as:

  1. Non-spendable – identifying amounts (such as inventory).
  2. Restricted – includes amounts that can only be used for a specific purpose stipulated by the constitution, external resource providers, or through enabling legislation.
  3. Committed – includes amounts that can only be used for a specific purpose determined by the City Council.
  4. Assigned – includes amounts that can be used for a specific purpose but do not meet the criteria to be classified as “restricted” or “committed.”
  5. Unassigned – includes all spendable amounts not contained in other classifications.

The City has reserved unassigned fund balance at 90 days of current year budgeted expenditures for both the General and Utility Funds. In other operating funds, the City shall strive to maintain a positive fund balance to provide sufficient reserves for emergencies and revenue shortfalls. Except for special revenue funds, the fund balance shall be used only for emergencies, non-recurring expenditures, or major capital purchases that cannot be accommodated through current year savings.

Description

The Finance Department for the City of Fredericksburg contains both Financial and Utility Billing personnel. Finance personnel manage, control, and accurately report on the financial affairs of the City of Fredericksburg. Utility Billing personnel oversee all aspects of both Utility Billing and customer service. The Finance department functions under the direction of the City Manager's office through which the needs, concerns, and desires of the citizens are ultimately expressed.

As a support function, the Finance Department works in partnership with other City departments to develop budgets, implement control measures, and establish policies and procedures aimed at accurately accounting for, safeguarding, and maximizing the value of the City's assets.

Goals and Objectives

  • Collect and record receipts for taxes, licenses, fees, grants, and other revenues
  • Oversee and assist other Departments with the purchasing of goods and services
  • Maintain accurate financial records
  • Monitor investments and debt
  • Oversee adherence to budgetary restrictions
  • Prepare and distribute financial information
  • Safeguard assets
  • Provide excellent customer service
  • Listen to and manage customer utility issues
  • Process and reconcile utility payments
  • Electric meters will all be changed out to Sensus meters and software will be purchased to integrate with the Sensus software
  • Process utility billing in a timely manner

In order to meet these goals, we will

Established and maintains an internal control structure designed to ensure that the assets of the City are protected from loss, theft, or misuse and to ensure that adequate accounting data is compiled to allow for the preparation of financial statements in conformity with Generally Accepted Accounting Principles. These statements are issued in the form of the City of Fredericksburg's Basic Financial Statement. The Basic Financial Statement details the City’s financial activity and position, which is audited by an independent firm of Certified Public Accountants. The report is the culmination of the City’s fiscal year financial activity.

For the Utility Billing aspect of the Finance department, we will continue to treat all customers, the public and fellow personnel of the City of Fredericksburg with the utmost respect and integrity. There are established rules and safeguards between the Utility Billing personnel and the Finance personnel that ensures customer payments are processed efficiently and with minimal errors.

Additionally, the department is instrumental in the compilation of the City of Fredericksburg Budget. The Budget establishes management's fiscal plan for the City and is the control tool employed and referenced throughout the period by City staff. The services, programs, revenues, and expenses contained in the Budget reflect the methods and use of resources through which staff intends to accomplish the goals, objectives, and long-term plans of the City of Fredericksburg.

What we accomplished in 2021-2022

  • Maintained good accounting policies and procedures
  • Received Distinguished Budget Presentation Award
  • Received unmodified, clean opinion on annual audit
  • Monitored customer water usage and alerted them if there was a change in their usage which could indicate a water leak
  • Provided excellent customer service to the public and utility billing customers
  • Attended training and seminars to increase knowledge
  • Cross trained Finance Department Personnel
  • Educated Customers on Stage 3 Water restriction issues
  • Assisted Customers on Water Portal set up
  • Converted to online filing system for Accounts Receivables and Accounts Payables
  • Participated in Springbrook Training – Extended Budgeting Module (Jan 2022)
  • Filed claim with FEMA for Winter Storm Uri
  • Created published reports in Springbrook for departmental use and ease of reporting
  • Evaluated our current budgeting and reporting process for improvement options and found software solutions available to integrate with our financial software to create efficiencies and improve transparency
  • Received council approval in September 2022 to purchase OpenGov software
  • Filed our first annual report for American Rescue Funding spending (April 2022)
  • Participated in Leadership Gillespie County annual program
  • Attended the annual GFOA conference in Austin, TX (June 2022)
  • Awarded American Rescue Funding to local non-profits
  • Approved two new positions, Hot Occupancy Tax Clerk and City Accountant
  • Worked with IT to create EAP (Electronic Accounts Payable) program
  • Added a Purchasing Coordinator to assist personnel with locating goods, mitigating cost increases, and making purchases that adhere to the Financial Management Policy for Expenditures
  • Attended continuing education to improve accounting knowledge and practices and add/expand skills that are beneficial to our work
  • Constructed a short-term rental data spreadsheet for Development Services to use to manage short-term rentals within the community
  • Provided input and assistance with the implementation of short-term rental and hotel occupancy tax collections software through Granicus

What we plan to accomplish in 2022-2023

  • Continue to maintain good accounting policies and procedures
  • Continue to receive unmodified, clean opinion on annual audit
  • Continue to obtain the Distinguished Budget Presentation Award from the Government Finance Officers Association
  • Continue to provide excellent customer service to the public and utility billing customers
  • Continue to allow staff to attend training and seminars to increase knowledge
  • Continue to cross train Finance Department Personnel
  • Participate in Staff Development by touring City infrastructures and familiarizing staff with areas that are continuing to be developed within the City
  • Research options for an Automated Calling System to create focused messages for our customers to be delivered in mass
  • Increase customer satisfaction by researching and implementing an Online Bill Pay option that is compatible with our current Billing Software
  • Research a voice automated payment system that is compatible with our current Billing Software
  • Continue monitoring spend of American Rescue for city and local non-profits awards in order to file annual report (April 2023)
  • Successful implementation with OpenGov for budgeting and transparency performance
  • Winter Storm Uri close out project
  • Train and onboard two approved new hires
  • Implement Electronic Accounts Payable (EAP) program
  • Work with IT department to train department Supervisors on EAP program
  • Continue to provide input and assistance with the implementation of short-term rental and hotel occupancy tax collections software through Granicus
  • Continue to attend continuing education to improve accounting knowledge and practices and add/expand on skills that are beneficial to our work
  • Identify ways to make Finance processes more streamlined and/or automated
  • Develop a plan to mitigate inflation on the cost of goods and services
  • Assist Development Services with the implementation of My Permit Now software

Finance Department Performance Measures