- Budget Definitions
A basis of accounting in which revenues are recognized in the accounting period in which they are earned, and expenditures are recognized in the period in which they are incurred.
Denotes revenue or expenditure totals for a given period, which is in contrast to "Budget" which denotes estimates for a period.
AD VOLOREM TAX
A property tax computed as a percentage of the value of taxable property. See "Assessed Value".
The financial plan approved by the City Council, which forms a basis for appropriations. The final draft of the budget document includes Budget Committee and City Council revisions and is submitted to the State for filing.
The legal authorization made by the City Council, which permits the City to incur obligations and to make expenditures of resources.
The budget that the Citizens Budget Committee recommends to the City Council for adoption.
Lower of maximum assessed value or real market value. Exceptions exist for changed property and special provisions for specially assessed or partially exempt property.
A comprehensive examination as to the manner in which the government's resources were actually utilized, concluding in a written report or opinion. A financial audit is a review of the accounting and financial information to determine how funds were spent and whether they were in compliance with appropriations. A performance audit consists of a review of how well the government met its stated goals.
AVERAGE MAXIMUM ASSESSED VALUE
If the property is not specially assessed or partially exempt, the value determined by dividing the total maximum assessed value of all property in the same area in the same property class by the number of properties in the same area in the same property class. If the property is specially assessed, or partially exempt, the amount is determined by dividing the total maximum assessed value of property in the area that is subject to the same exemption or special assessment program as the subject property by the total number of such properties in the area.
AVERAGE REAL MARKET VALUE
The value determined by dividing the total real market value of all property in the same area in the same property class by the number of properties in the same area in the same property class.
A written promise to pay a specified sum of money on a specific date at a specified interest rate. Bonds are most frequently used to finance large capital projects, such as buildings and streets. The City currently has one type of bond outstanding: Revenue Bond.
A document showing the City's financial plan for one or two fiscal years (the City of Fairview budgets on a fiscal year basis). By statute, it must include a balanced statement of resources and requirements for the previous two periods and estimated revenues and expenditures for the current and upcoming year.
The schedule of key dates which the City follows in the preparation and adoption of the budget.
A financial planning board of a local government, consisting of the governing body (City Council) plus an equal number of appointed legal voters from the community (citizens).
A message prepared by the City Manager explaining the proposed budget, articulating the strategies to achieve the City's goals, and identifying budget impacts and changes.
An asset costing $5,000 or greater with a useful life of more than one year.
CAPITAL IMPROVEMENT PLAN (CIP) A plan for capital expenditures to be incurred over several future years. It sets forth each capital project, identifying the expected beginning and ending date for each project, the amount to be expended in each year, and the method of financing those expenditures.
Expenditures which result in the acquisition of or addition to, the City's fixed assets. The City's capitalization threshold is currently $5,000 per item.
The legislative branch of the City composed of seven elected officials who serve a four year term.
COMPREHENSIVE ANNUAL FINANCIAL REPORT (CAFR)
The complete annual financial report of the City that is prepared in conformity with generally accepted accounting principles. An independent auditing firm audits the financial statements in this annual report.
An appropriation of funds to cover unforeseen events and emergencies, which may occur during the budget period. City Council must authorize the use of any contingency appropriations.
The costs related to services performed for the City by individuals, business, or utilities.
Payment of principal and interest related to long-term debt. The City has debt service payments budgeted in the Fairview Lake LID Fund, the Water Fund, and the Sewer Fund.
DEBT SERVICE FUND
A fund established to finance and account for the payment of interest and principal on all general obligation debt, serial and term, other than that payable exclusively from special assessments and revenue debt issued for, and serviced by, a government enterprise fund.
A major administrative organizational unit of the City which indicates overall management responsibility for one or more divisions.
DEVELOPMENT CODE AND STANDARDS
The City's procedures and criteria for the review and approval of land development proposals.
A trm that refers to an election where at least 50% of the registered voters eligible to vote in the election cast a ballot and more than 50% voting on the measure approve. The voter turn out requirements do not apply at a general election held in November of an even-numbered year, as approval of a measure at a general election is considered to meet the "double majority" requirement by definition.
The commitment of appropriated funds to purchase an item or service. To encumber funds means to set aside or commit funds for a future expenditure.
A fund established to account for operations in a manner similar to private business enterprise, in that, the costs of providing services to the general public on a continuing basis are recovered primarily through user charges. The City's three enterprise funds are Water, Sanitary Sewer, and Storm water Funds.
The amount of projected revenues to be collected during the fiscal year.
A decrease in the financial resources of the City due to the procurement of goods and services.
A twelve-month period at the end of which a government determines its financial position and the results of its operations (July 1 through June 30 is required for municipalities in the State of Oregon).
A fee paid by businesses for use of City streets, alleys, and/or property in providing their services to the citizens of the community. Services requiring franchises include electricity, telephone, natural gas, waste collection, and cable television.
FULL-TIME EQUIVALENT (FTE)
Staffing levels are measured in FTE to give a consistent comparison from year to year. One full-time position filled for the entire year equals one FTE; however, in some instances a FTE may actually consist of several part-time positions.
An independent grouping of accounts that are self-balancing by, recording cash and/or resources together with all related liabilities, obligations, reserves, and equities. Funds are segregated for the purpose of carrying on specific activities or attaining certain objectives.
The budget amount available in a particular fund at a certain period of time.
GAAP, GENERALLY ACCEPTED ACCOUNTING PRINCIPLES
The Government Accounting Standards Board is the body that establishes accounting principles for state and local governments.
GASB- STATEMENT NO. 34
This statement's objective is to enhance the understandability and usefulness of the external financial reports (i.e. the audit) of state and local governments. Among its requirements: a new section- Management's Discussion and Analysis (MD&A), governments-wide financial statements prepared on the accrual basis of accounting, and the reporting of infrastructure and depreciation on all capital assets.
The general operating fund of the City. It is used to account for all financial resources except those required to be accounted for in another fund.
GENERAL OBLIGATION BONDS
General obligation bonds are long-term obligations backed by the "full faith and credit" pledge of the city's general fund revenues. They carry an unlimited taxing power, require voter-approval, and are limited in total to 3% of the city's true cash value.
GFOA- GOVERNMENT FINANCE OFFICERS ASSOCIATION
The Government Finance Officers Association is the premier association of public-sector finance professionals and is dedicated to providing high-quality support to state and local governments. Annually, the City applies for the distinguished Certificate of Achievement for Excellence in Financial Reporting (for the audit).
General statements of each division's desired social or organizational outcomes.
A contribution by one governmental unit to another. The contribution may be made to aid in the support of a specified purpose or function or general purpose.
Substructure or underlying foundation of the City (e.g. streets, utility lines, bridges, sidewalks, etc.).
Revenues received from another governmental entity, such as county, state, or federal governments.
LEVEL OF SERVICE
The amount and type of existing services, programs, and facilities provided. Level of service depends on the available resources.
The amount of ad valorem tax certified by a local government for the support of governmental activities.
LOCAL BUDGET LAW
Oregon Revised Statute (ORS) 294.305 to 294.565. Local Budget Law has several purposes: 1) establish standard procedures for presenting a local government budget: 2) outline programs and services provided; 3) provide a standard method for estimating revenues, expenditures, and proposed tax levies; and 4) encourage citizen involvement in the preparation of the budget before formal adoption.
LOCAL OPTION LEVY
A voter approved serial levy meeting the double majority test that may extend the limits of Measure 50. They are limited to 5 years, but may extend to 10 years for a capital project. These levies do not become part of the permanent rate limit.
MATERIALS AND SERVICES
Expendable materials, operating supplies, and services necessary to conduct departmental activity.
On November 6, 1990, Oregon citizens approved an amendment to the State Constitution (Measure 5) which limits the ability of state and local governments to levy property taxes, impose certain types of charges, and to issue certain types of debt. Measure 5 sets a maximum tax rate of $10 per $1,000 of true value for overlapping general-purpose governments. The amendment also subjects school districts to a property tax cap of $15 per $1,000 full market value in 1991-92, declining in $2.50 increments to $5 in 1995-96.
On May 29, 1997, Oregon citizens approved an amendment to the State Constitution (Measure 50) which limits the ability of the state and local governments to levy property taxes, impose certain types of charges and issue certain types of debt. Measure 50 sets a
statewide property tax reduction of 17% which was authorized for 1996-97 fiscal year. Certain types of property tax levies are exempt or may be added outside of the reduced amount. Limits assessed value to 3% growth and requires that certain fees receive voter approval if increased.
MODIFIED ACCRUAL BASIS OF ACCOUNTING
The accrual basis of accounting adapted to governmental funds where revenues are recognized when they become both "measurable" and "available to finance expenditures of the current period." Expenditures are generally recognized when the related fund liability is incurred.
A specific, measurable and observable result of an organization's activity which advances the organization toward a goal.
The portion of the budget that pertains to daily operations providing basic governmental services. The operating budget contains appropriations for such expenditures as personal services, supplies, utilities, materials, and debt service.
Written directive or act of a governing body. Has the full force and effect of law within the local government's boundaries, provided it does not conflict with a state statute or constitutional provision. See "Resolution".
Oregon Revised Statutes
PERMANENT RATE LIMIT
A tax rate calculated under the limitations of Measure 50 that would extend the full amount of "operating taxes" that could be imposed. The City of Fairview permanent rate is 3.4902 per $1,000.
The State of Oregon Public Employees Retirement System (PERS) is the retirement program for about 95 percent of state and local government employees in Oregon.
Expenditures including wages and fringe benefits of a government's employees.
A tax that uses assessed property value as the base by which the cost burden of local services is determined.
PROPERTY TAX ACCOUNT
Administrative account number used for the purpose of listing property tax on the assessment roll.
Financial and operating plan proposed by the budget officer, submitted to the public and budget committee for review.
REAL MARKET VALUE (RMV) The amount in cash that could reasonably be expected to be paid by an informed buyer to an informed seller, each acting without compulsion in an arm's length transaction/ occurring as of the assessment date for the tax year, as established by law.
An account used to indicate that a portion of a fund balance is restricted for a specific purpose.
An order of a governing body. Requires less legal formality and has lower legal status than an ordinance. Statutes or charter will specify which actions must be by ordinance and which may be by resolution (for cities, revenue-raising measures such as taxes, special assessments, and service charges always require ordinances). See "Ordinance."
Total amount available for appropriation, consisting of estimated beginning funds on hand plus anticipated revenues.
Revenue bonds are long-term obligations that are payable solely from a designated source of revenue generated by the project which was financed. No taxing power or general fund pledge is provided as security.
Monies received or anticipated by a local government from either tax or nontax sources.
SPECIAL REVENUE FUND
A fund used to account for the proceeds of specific revenue sources (other than special assessments, expendable trusts, or major capital projects) that are reserved for specific purposes.
STATE SHARED REVENUE
Revenues received from the State of Oregon from cigarette, liquor, and highway taxes under ORS 221. These funds are available to cities located in counties with at least 100,000 inhabitants that provide at least four types of municipal services.
STATE REVENUE SHARING
A share of certain revenues from the State of Oregon that are apportioned among and distributed to cities for general purposes. These funds require a public hearing before the budget committee to discuss possible uses.
A supplemental budget is a budget adjustment to fund unexpected needs or to spend revenues not anticipated at the time the regular budget was adopted. It cannot be used to increase a tax levy.
The total amount of taxes imposed by the City on taxable property, as determined by the appraisers for Multnomah County.
The tax rate discussed by the citizens budget committee and set by the City Council. It is made up of two components: operations and debt service. It is usually expressed as a rate for each $1,000 of assessed value.
Amounts distributed between funds to finance activities in another fund. Shown as expenditure in the originating fund and revenue in the receiving fund.
UNAPPROPRIATED ENDING FUND BALANCE
Amount set aside in the budget for carryover to the following period providing the local government with needed cash flow until other money is received (typically in November). This amount cannot be transferred by resolution or used via a supplemental budget.
UNITY OF PROPERTY
For purposes of Measure 50, "property" and "unit of property", except for centrally assessed utility property, means all property included within a single property tax account.