FY 2017 Popular Annual Financial Report FY 2017 Popular Annual Financial Report | Page 7

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Reserves

In accordance with the City’s
financial principles, several cash reserves
are maintained to mitigate the impact of
a significant economic downturn on our
ability to maintain service levels to our
citizens. These reserves are an important
consideration by bond rating agencies
in determining the City’s overall credit-
worthiness. The major reserves include
the Unallocated Reserve, targeted
at 3% of recurring General Fund
expenditures. It is designed to be used
for emergencies and unanticipated
expenses. The Working Capital Reserve
sets aside one month of recurring
General Fund expenditures to provide
adequate operating cash during normal
revenue and expenditure cycles. This
is the City’s largest reserve, funded at
$20.1 million for FY 2018. The next-
largest reserve is the Landfill Lease
Reserve, in excess of $17 million, which
originated from a one-time payment
to the City when the landfill was leased
in May 2005. Our newest reserve
is the Business Continuity Reserve,
originally targeted at 3% of General
Fund expenditures. This reserve is in
place to ensure that in the face of
funding shortfalls, service delivery will
continue until sound solutions to the
shortfall can be identified. The total
reserve amount adopted in the FY 2018
budget is $50.2 million, or 20.9% of
the City’s General Fund budget, net of
one-time expenditures. This amount is
approximately $14.1 million in excess of
HOME level specified in
the 15% overall reserve
PLATE
our Financial Principles.
Bond Rating

NEWS
STORY
Moody’s, Standard & Poors, and
Fitch rate our credit-worthiness and
they consider our reserves as one of
our strongest assets. All three agencies
affirmed the ratings for the Permanent
Improvement Bonds, Certificates of
Obligation, Water and Wastewater
System Revenue bonds, and Municipal
Drainage Utility System Revenue Bonds
(Stormwater). These strong ratings allow
us to issue municipal debt vital to the
City’s infrastructure at a very low cost to
the City.

The Special Tax Revenue Refunding
Bonds (AT&T Stadium) have been rated
A1 / A+ / AA+ by Moody’s, Standard &
Poors and Fitch respectively.
Debt

During FY 2017, the City took
advantage of the low cost of borrowing
and issued $58.4 million in Permanent
Improvement Bonds, $6.1 million in
Certificates of Obligation, and $18.2
million in Permanent Improvement
Refunding Bonds to make various
capital improvements and capture
interest savings. The City issued $45.1
million in Water and Wastewater System
Revenue Bonds for the purpose of
improving and expanding existing water
and wastewater infrastructure. The
City issued $9.0 million in Municipal
Drainage Utility System Revenue
Bonds (Stormwater) for the purpose
of improving and expanding existing
drainage infrastructure. During the
year, the City paid down principal of
$34.2 million of outstanding Permanent
Improvement Bonds and Certificates of
Obligation.

The City also refunded all outstanding
Special Tax Revenue Bo nds originally
issued to pay for the construction of
AT&T Stadium (Dallas Cowboys) of
$145.8 million. The refunding of $110.2
million both captured interest savings
and allowed for new debt to be issued
to pay for construction of Globe Life
Field (Texas Rangers).
Awards

The City continued to be
recognized for its outstanding financial
reporting efforts. In 2017, the Finance
Department was proud to announce
that it is only the third local government
entity in the state to receive all five
transparency stars through the Texas
Comptroller’s transparency program.
The Comptroller’s office launched
the Transparency Stars program to
recognize cities, counties and school
districts making strides to greater
government transparency by providing
easy online access to important
financial data. Arlington earned stars
for transparency in Traditional Finances,
Contracts and Procurement, Economic
Development, Public Pensions and Debt
Obligations.

We again received the Certificate
of Achievement for Excellence in
Financial Reporting for our 2016
Comprehensive Annual Financial Report
(CAFR), the Certificate for Outstanding
Achievement in Popular Annual
Financial Reporting for our 2016 PAFR,
and the Distinguished Budget Award for
our 2017 budget from the Government
Finance Officers Association. We
also received our 14 th consecutive
Achievement of Excellence in
Procurement HOME
Award from the National
PLATE
Procurement Institute, Inc.
Priorities
NEWS
STORY

Each year, the City Council
identifies community priorities that
guide us in allocating the City’s
resources. Council’s strategic retreat
in the spring of 2016 resulted in the
following priorities for Fiscal Year 2017:
• Putting Technology to Work
• Champion Great Neighborhoods
• Enhance Regional Mobility
• Invest in Our Economy
• Support Quality Education
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