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1616 Special Council Meeting August 22, 2012 Page 4 simpler. If you decide to sell certificate of obligations or general obligation bonds or have an election, you would hire a financial advisor and a bond counsel. Mayor Hashmi inquired if there was a possibility of replacing infrastructure without issuing bonds, such as using the general fund and at the same time not exhausting the funds from the general fund. He asked Mr. Anderson to explain. Mr. Anderson said the Mayor asked him to determine what constituted three months operating money in the general fund and compare it to the year -end balance in the general fund. He said he was asked about the difference of those two amounts and what type of tax rate would it take to replace that money. Mr. Anderson said you basically you would be spending it and replacing in the same year. He said at the end of September, the City was projected to have an estimated 9.4 million dollars left in the general fund. He said based on the Manager's proposed 2012 -13 Budget, twenty months operations and maintenance would be about 5.4 or 5.5 million dollars so the difference would be about 3.9 million dollars. Mr. Anderson reiterated the City Manager in that a one penny increase on the tax rate would bring in $134,363. Mr. Anderson said if Council tried to spend the 4 million dollar excess over the three months that it would take almost $30 on the tax rate to replace that entire amount in a single year. Mayor Hashmi wanted to know if bonds were issued for that same amount of money how that would affect the tax rate. Mr. Anderson said he would have to do some calculations. Mayor Hashmi said he was not making suggestions, but simply wanted the Council to explore all avenues. Mayor Hashmi also inquired about the water funds with regard to replacement of infrastructure. Mr. Godwin said that the reserves could be used for any general government purpose. Mayor Hashmi confirmed that some of the water fund could also be used for infrastructure. Council Member Wright suggested that the water line replacements be prioritized prior to utilizing any funds. Mayor Hashmi agreed. 10. Presentation and discussion on the 2012 -2013 Budget for the City of Paris. City Manager John Godwin presented the 2012 -2013 Budget to City Council. Mr. Godwin said he had eight basic categories he wanted to review with the City Council and the first seven were priorities, which included, clean-up, planning, performance, infrastructure, reorganization, water and waste water plants and tax rates. Mr. Godwin said the eighth category was other and future issues which they did need to discuss and subsequently reviewed his budget summary with City Council. (See Exhibit "A ") Council Member Wright wanted to know the total number of employees Mr. Godwin was planning to add to the budget. Mr. Godwin said one full -time and one part-time. Council Member Wright asked Mr. Godwin if he had ever considered completing a personnel audit to determine if there was a person who could better serve in a different position. Mr. Godwin said he had begun that process. Mr. Godwin reported that the current tax rate was $0.52 per $100 of assessed valuation and he was recommending a total ad valorem tax rate of $.51107, a reduction of 1.71 %, three times the amount targeted. 11. Discuss and act on RESOLUTION NO. 2012 -074: A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PARIS, TEXAS, CALLING A PUBLIC HEARING ON THE CITY MANAGER'S PROPOSED BUDGET FOR FISCAL YEAR 2012 -2013.