05-Council Minutes from the meetings of August 16, 17, and 23, 2010

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Cr L~T Ohl, 9 MEMORANDUM To: City Council From: Kevin Carruth, City Manager Re: Budget Message Date: August 6, 2010 Introduction In accordance with Section 45 of the City of Paris Charter and Chapter 102 of the Texas Local Government Code, I am pleased to present for your consideration the proposed annual budget for fiscal year 2010-2011, beginning October 1, 2010. This balanced budget is intended to serve as: 1. A plan of financial operations embodying an estimate of expenditures for the next fiscal year and the means of financing them. 2. A management and operational plan for allocation of resources during FY 2010-2011. The budgetary and accounting policies contained in the budget conform to generally accepted accounting principles (GAAP) as established by the Governmental Accounting Standards Board (GASB). The accounts of the City are organized on the basis of funds and account groups, each of which is considered a separate budgetary and accounting entity. Within the budget, the City's various funds are grouped into general fund types and proprietary fund types. The budget is prepared on the GAAP basis, with all governmental funds accounted for using the modified accrual basis of accounting and proprietary funds accounted for using the accrual basis of accounting. In calendar year 2009, Paris weathered the national economic recession very well compared 'to most cities, even in Texas. A year ago, sales tax receipts were 14.9 percent above the same period last year and, until July 2009, every month was considerably above the same month last year. This was due in large part to the construction of two different natural gas transmission lines through Lamar County. As those projects were completed and the recession continued, sales tax receipts began to return to their pipeline pre-construction levels, resulting in noticeable decreases in year-to-date (YTD) comparisons in FY 2009-2010. The Fiscal 2009-2010 YTD decrease is 9.6 percent but compared to the 2008-2009 pre-construction YTD totals sales taxes are up 3.9 percent. Additionally, the U.S. Municipal Cost Index (designed by American City and County magazine to show the effects of inflation on the cost of providing municipal services) was 3.7 percent higher for the 12-month period ending in June while the U.S. Consumer Price Index (CPI) was up 2.1 percent during the same period. Paris, as a retail and healthcare hub for a multi-county area, is in a better position than many communities to weather the recession but we P.O. BOX 9037 - PARIS, TEXAS 75461-9037 - (903) 785-7511 - FAX (903) 785-8519 4xhi bi t "A"