FY 2026 Adopted Budget - Flipbook - Page 92
Budget Process
Budgetary Basis
The budget for the governmental funds is adopted on a modified accrual basis consistent with
Generally Accepted Accounting Principles (GAAP). The budget for the enterprise funds is adopted
on a non-GAAP accrual basis to reflect the budget versus actual information related to “operations
and maintenance” as defined in bond covenants. This is identical to the basis of accounting used in
the Annual Comprehensive Financial Report (ACFR).
The foundation of the modified accrual basis of budgeting closely mirrors the basis of accounting,
establishing a parallel framework that guides financial management and reporting in the public
sector. The alignment between these two concepts is crucial for ensuring transparency, accuracy
and consistency in budgeting and financial reporting practices. Underlying this alignment is the
emphasis on distinguishing between short-term operational activities and longer-term capital
investments. The modified accrual basis of budgeting, like the basis of accounting, seeks to strike a
balance between addressing immediate financial needs and capturing the broader financial impact
of capital projects and long-term obligations. By mirroring the basis of accounting, the modified
accrual basis of budgeting ensures that budgeting decisions are reflective of the financial reality
and can be compared to actual financial outcomes reported in financial statements.
The modified accrual basis of accounting is followed by all Governmental and Agency fund types.
Under the modified accrual basis, expenditures other than un-matured interest on general longterm debt are recognized at the time the liabilities are incurred, if measurable. Revenues are
recognized in the accounting period when they become measurable and available. Revenues that
are susceptible to accrual are as follows:
Federal and State Shared Revenues
Federal and State Grants
Interest Income
Rental of Assets and Charges for Services
Franchise Fees and Utility Taxes
Proprietary and Pension Trust funds are maintained on an accrual basis with revenues being
recognized when earned and expenses recognized when incurred.
Budget Decision-Making Process:
The City’s budget decisions play a pivotal role in shaping the trajectory of the City’s growth,
development, and overall well-being. These decisions are integral to allocating financial resources
efficiently and effectively, ensuring that the City can achieve its organizational and community goals.
The process of making budget decisions is carefully structured to support these goals and promote
the betterment of both the City and the residents it serves.
Goal Identification: The goal identification process begins with identifying the City’s goals and
priorities. These may include enhancing public services, improving infrastructure, fostering
economic development, ensuring public safety, and preserving the environment, among others.
Budget Development: City departments collaborate to create budget proposals aligned with the
identified City’s Strategic Plan goals. These proposals outline resource needs, program costs,
and potential impact on the community.
Prioritization: The proposed budgets are reviewed and evaluated by City management,
department heads, and the City Commission. Prioritization occurs based on alignment with the
City’s objectives and community needs.
Resource Allocation: The available financial resources are allocated to various departments
and programs based on established priorities. Trade-offs are considered, as funding one
initiative might mean reducing resources for another one.
Public Input: The City encourages public participation and transparency by having public
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