DENTON County, Texas Connecting Communities and Serving residents since 1846 Rooted in history, rich in culture, embracing the future Photo provided courtesy of HDR Architects DENTON County, Texas Adopted Budget FY2020-2021 DENTON County, Texas OVERVIEW 1 Budget Calendar Overview January Preparation for Budget Process Begins February Budget Kickoff Meeting March-April Departments Complete Requests May-July Recommended Budget Prepared July 25th Certified Roll from Appraisal District August 11th Presentation of Recommended Budget 2 Initial Request Overview Initial Budget Request = $327 million Would have been an increase of $5.8m (or 1.81% above the FY2019-20 Adopted Budget) A Tax rate of $0.263208 would have been required (or a 22.22% Tax Rate Increase) 3 Adopted Budget Overview Adopted Budget = $319 million (a reduction of $8m from Initial Request) Decrease of $2.7M (or 0.83% below the FY2019-20 Adopted Budget) Tax rate of $0.224985 Adopted = 0.130062 % below Current Adopted Rate = 3.228589 % below No-New-Revenue Rate 4 Adopted Budget Overview – Summary by Fund 5 DENTON County, Texas REVENUE ANALYSIS Local Government Code 111.063 requires the County Auditor to provide estimates of funds available and funds expected to be received and submitted to the Budget Officer during the budget preparation process. 6 Eight Major Funding Sources •Property Taxes •Motor Vehicle Registration •Intergovernmental Revenues •Fees of Office •Fines •Interest •Miscellaneous •Fund Balance /Reserve Funds 7 Eight Major Funding Sources 8 Property Taxes Largest single source of revenue. 2020 fiscal year collections have been strong. Including penalty and interest payments as well as other adjustments to the tax levies, collections have exceeded 100% of the tax levies in prior years, and this is expected to continue in future years. 9 Vehicle Registration An optional county vehicle registration fee is authorized by Chapter 502 of the Transportation Code. Denton County assesses the maximum additional registration fee of $10 per vehicle. Revenue from this fee, which must be deposited to the Road and Bridge Fund, is expected to generate $6.8M per year. The 5% auto registration fee for collecting automobile sales taxes for the state is projected at $5.3M. This is primarily budgeted in the General fund. Decrease of $230,000 from FY2020 10 Intergovernmental Primarily State and Federal Grants and payments from City and State Governments that may be statutory or contractual. A $4,269,097 decrease from FY2020. Many intergovernmental revenues will remain at current levels due to actions by State Legislature and Federal government. The revenues include lateral road funding, juror pay reimbursements, overweight vehicle fees, and Medicaid payments in the Health Department. 11 Fees Fees for services provided to the public. Most are set by statute and budgeted in the General Fund. Fees are included at $20.3M or a increase of $209,461 from prior year. 12 Fines Received from Justices of the Peace, County Criminal Courts and District Courts – deposited in General Fund. Projected to generate $2.2M. All Courts have experienced a decrease the last several years. Expected Revenue by Court: J.P. Courts $990,000 $90,000 reduction County Courts $700,000 $50,000 reduction District Courts $465,000 $35,000 reduction 13 Interest Most volatile revenue source for the county for the last nine years. Interest revenues are projected to be $1.5M or a decrease of $1,143,165. 14 Miscellaneous Primarily refunds/reimbursements for services not connected with a specific office and some fees for services not connected with a specific office. These revenue sources include inmate phone fees, Court- Appointed Attorney refunds, operating cost reimbursement for the Child Protective Services (CPS) building, Sheriff and District Attorney forfeiture revenues, and bail bond forfeitures, etc. Decrease of $290,800 from FY2020. 15 Fund Balance Projected ending fund balance = $70M for all funds and should be exceeded since we historically spend approximately 96% of budget and collect more revenues than estimated. Our balances are adequate to protect the county in the event of unforeseen occurrences and complies with and exceeds Fund Balance Policy. 16 Revenue Summary Taxes - We expect an approximate $4.8 million increase in available revenue on total taxable value of all property calculated. Vehicle registration – we have budgeted a decrease of $230,000 below the 2020 budgeted amounts. Intergovernmental revenue – We have budgeted a decrease of $4,269,097 in 2021 from the amended 2020 budget; increases in Mixed Beverage Tax and Medicaid DSRIP funding will offset some decreases in inter-local contract fees. 17 Revenue Summary (continued) Fees – Fees in all funds are estimated to increase by $209,461 from 2020. Most of the increase is attributable to increases in records preservation fees and judicial service fees. Fines – Fines are estimated to decrease by $175,000 from 2020. Most of the decrease is attributable to decreases in court collections in all courts, especially the misdemeanor courts. Interest Revenue – The estimate for 2021 interest revenue is lower than 2020 by $1,143,165. Investment earnings are expected to start to decrease in 2020 compared to 2019. Miscellaneous Revenues –basically unchanged from 2020. 18 DENTON County, Texas Tax Rate 19 Tax Rates No-New-Revenue Tax Rate = $0.232491 (rate that will generate the same tax revenue on existing property as the prior year) Adopted tax rate = $0.224985 Current Tax Rate = $0.225278 Variance (Current vs. Adopted) = -$0.000293 3.228589% below the No-New-Revenue tax rate 20 Adopted Tax Rate Current Tax Rate = $0.225278 Adopted Tax Rate = $0.224985 Variance (current vs. adopted) = -$0.000293 Calculated at: $0.140322 General Fund M&O $0.004501 Road & Bridge Fund $0.012114 Juvenile Probation Fund $0.005141 Public Health Fund $0.001085 Indigent Care Fund $0.056604 Debt Service Fund $0.005218 Permanent Improvement Fund 21 Adopted Tax Rate Denton County continues to maintain a very conservative tax rate. This budget was prepared based on a rate of $0.224985, which is a reduction to the current rate. The FY2021 Adopted Tax Rate is the lowest it has been since 1986! 22 Average Home Owner (Annual Property Taxes - Adopted tax rate) Total Annual Taxes $7,795 School District* City of Denton $5,014 $2,014 or 26% or 64% Denton County $767 or 10% Denton County: Using Adopted Rate of $0.224985 & Average Denton County Home Value of $341,090 (per the Denton Central Appraisal District) * Uses FY2020 Current Tax Rates for Denton ISD $1.470000 / City of Denton $0.590454 23 Average Home Owner (Monthly Property Taxes - Adopted tax rate) Total Monthly Taxes $650 450 418 400 350 300 250 168 200 150 100 64 50 0 Denton County School District* City of Denton* Denton County: Using Adopted Rate + Average home value (per the Denton Central Appraisal District) * Uses FY2020 Current Tax Rates for Denton ISD $1.470000 / City of Denton $0.590454 24 Average Home Owner (Property Tax Variance – Adopted Tax Rate) Sample FY2020 FY2021 Annual Monthly Home Value Adopted Tax Adopted Tax Variance Variance Rate Rate Impact Impact Tax Rate per $100 Value: $0.225278 $0.224985 (Savings) (Savings) $100,000 $225 $225 ($0.29) ($0.02) $341,090* $768 $767 ($1.00) ($0.08) • This chart assumes no increase in valuation. Changes in an individual taxpayer’s county taxes depend on the specific change in property valuation. • *Average home value in Denton County for Tax Year 2020 (per the Denton Central Appraisal District) 25 Tax Rate Comparison (Top 15 Counties) Denton County's tax rate is currently the second lowest County Tax Rate among the Top 15 Texas Counties by population. 26 Top 15 Texas Counties (County Tax Rate & County-Wide Tax Rate) Top 15 Texas Counties 2019-2020 Survey County Population Estimate Total County Tax Rate Total County-Wide Tax Rate Collin 1,005,146 0.174951 0.256173 Denton 901,120 0.224985 0.224985 Tarrant 2,024,030 0.234000 0.617299 Dallas 2,618,000 0.243100 0.646600 Bexar 1,986,049 0.277429 0.745062 Nueces 362,265 0.311588 0.424009 Travis 1,304,311 0.369293 0.579766 Harris 4,720,000 0.407130 0.611700 Brazoria 370,200 0.415233 0.415233 Cameron 423,908 0.436893 0.436893 Fort Bend 764,828 0.444700 0.460000 Montgomery 590,925 0.447500 0.614200 Williamson 633,783 0.458719 0.458719 El Paso 840,410 0.488997 0.897911 Hidalgo 865,939 0.575000 0.902600 Denton County: Adopted “County” Rate = 2nd Lowest & Adopted “County-Wide” Rate = Lowest (County-Wide = tax rates for County, Hospital District, Community College, Flood Control & Port Authority) 27 Top 15 Texas Counties (by County Tax Rate) 0.700000 0.600000 0.500000 0.400000 Tax Rate in Cents Rate Tax 0.300000 0.200000 0.100000 Denton County: Adopted “County” Rate = 2nd Lowest (County Rates & Population Estimates for other entities based on “Top 15 Texas Counties 2019-2020 Survey”) 28 Top 15 Texas Counties (by County-Wide Tax Rate) 1.000000 0.900000 0.800000 0.700000 0.600000 0.500000 Tax Rate Cents in Tax 0.400000 0.300000 0.200000 0.100000 Denton County: Adopted “County-Wide” Rate = Lowest Rate (County-Wide = tax rates for County, Hospital District, Community College, Flood Control & Port Authority; County Rates & Population Estimates for other entities based on “Top 15 Texas Counties 2019-2020 Survey”) 29 Tax Rate Comparison (254 Texas Counties) According to the Texas Comptroller’s website, out of the 254 Texas counties, Denton County’s Tax Rate was the 4th lowest in FY2019* (FY2020 information will be released in the summer) 30 254 Texas Counties (by County Tax Rate) For FY2019, only 3 Texas counties had a county tax rate lower than our FY2021 Adopted tax rate: Midland County $0.140000 Collin County $0.180785 Culberson County $0.185310 Texas county tax rates range from $0.140000 to $1.183009 Average rate of 254 counties = $0.579787 Denton County’s Adopted rate of $0.224985= the 4th lowest rate in the state of Texas! Source – https://comptroller.texas.gov/taxes/property-tax/rates/index.php 31 DENTON County, Texas SERVICE DELIVERY 32 Service Delivery One of the challenges faced by Denton County includes the growth in population as Denton County continues to be one of the fastest growing counties in the state of Texas.