HomeMy Public PortalAbout2100.3 - Business and Financial Services - Management & Budget - Revenue PolicyOffice of Business and Financial Services
Management and Budget Section 2100.3
Policies and Procedures Manual Page 1
2100.3. SUBJECT: REVENUE POLICY
:1 OBJECTIVE:
To establish policies and procedures guiding administration of City revenue
sources to ensure financial stability, enhance financial planning, and promote
sound financial management.
:2 AUTHORITY:
This policy is adopted by the City Council, 11/1/10, Item A-2.
:3 DIRECTION:
The Chief Financial Officer, as an appointed official, serves at the pleasure of
and receives direction from the Mayor.
:4 FUNCTIONS:
A. Introduction
City government, as an institution, has multiple partners including
citizens, taxpayers, businesses, visitors, employees, and other
governments. As a major institutional, economic, and service force in the
region, it is important that the City strengthen r elationships with its
partners by adopting a clear and comprehensive set of policies and
procedures.
Furthermore the integrity of the City of Orlando is of utmost importance,
and adopting a set of policies is a key element to maintain this integrity.
The revenue objectives and policies stated herein shall provide the
framework for developing the City’s budget and evaluating revenue
alternatives.
B. Objective
The primary objective of the City of Orlando is to maintain a diversified
revenue system that provides a stable base to fund ongoing operations.
To that extent, the following statements shall serve as the City’s overall
revenue policy objectives:
1. A diversified, stable revenue system will be utilized to protect
the City from fluctuations in any one revenue source.
2. Cost recovery revenue sources (user fees) will be analyzed on an
annual basis and modified as necessary to ensure that revenue
collections reflect the cost of providing the associated service.
Office of Business and Financial Services
Management and Budget Section 2100.3
Policies and Procedures Manual Page 2
3. The City will strictly enforce laws and regulations requiring fees
for service and will aggressively pursue collection of revenue
owed to the City.
4. Enterprise operations of the City are intended to be self-
supporting. General Fund revenues should not be used to
subsidize enterprise fund operations.
5. The City will actively oppose State and/or Federal legislation
which would mandate costs without providing a revenue source
to offset those mandated costs. The City will be diligent to
protect current revenues received from State and Federal
sources.
C. Policies
1. Diversification and Stabilization
a. The City shall strive to diversify its revenues in order to
maintain the current level of service during periods of
declining economic conditions.
b. To the extent feasible, one-time revenue will be applied
to one-time expenses. Ongoing revenue should be equal
to or greater than ongoing expenses.
c. Revenue received from the sale of real property in
excess of $100,000 shall be credited to the
unappropriated fund balance of the appropriate fund, and
it is the City’s intention to use those funds to reinvest in
another capital asset.
2. Estimates of Revenue
a. The City will project its annual revenue through an
analytical process and will adopt its budget using
conservative estimates.
b. Annually the City will develop a forecast of General
Fund revenue for the five ensuing fiscal years.
c. Annually the City will prepare an inventory of revenue
sources (Revenue Manual) that will include legal
authority, important characteristics, and historical
collections.
3. User Fees
Office of Business and Financial Services
Management and Budget Section 2100.3
Policies and Procedures Manual Page 3
a. The City will maximize utilization of user charges that
can be individually identified and where costs are
directly related to the level of service.
b. The City will regularly review the budget to identify
those programs that can be funded by user fees. When
developing user fee opportunities, the City will consider
the following:
1) Community acceptability
2) Market pricing and fees charged by similar
governments
3) The impact of normal cost increases and
expenditure growth on the fee to be charged in
the future
4) The impact of users opting not to use the service
because of the fee
5) The cost of administering the user fee
6) Distribution of the City’s revenue burden as
measured by ability to pay and the benefits
received
7) Other policy considerations specific to the
proposed fee
c. The amount of a fee will not exceed the overall cost of
providing the facility, infrastructure, or service for which
the fee is imposed. When calculating the potential cost to
be recovered, the following will be considered:
1) Costs which are directly related to the provision
of the service
2) Indirect costs, or support costs, which are
general in nature but are necessary for the
delivery of the service
d. When determining the percentage of the total cost that
can be recovered through a user fee, the following
factors will be considered:
1) The nature of the facility, infrastructure, or
service
Office of Business and Financial Services
Management and Budget Section 2100.3
Policies and Procedures Manual Page 4
a) Proprietary services shall be self-
supporting
b) The cost of governmental services
should be supported with general tax
dollars to the extent the benefit and
enjoyment is community-wide
2) The nature and extent of the direct benefit to the
fee payer (when a service or facility results in a
substantial, immediate and direct benefit to fee
payers, a higher percentage of the cost should be
recovered by the fee)
3) The level of demand for the service
4) Ease of collection
e. User fees will be reviewed and updated on an ongoing
basis to ensure they keep pace with changes in cost of
the related service as well as changes in the method or
level of service delivery.
f. Criteria for waiving, adjusting, rebating or deferring a
user fee shall be approved by the City Council in the
ordinance, resolution, or policy establishing or
governing the fee.
4. Property Taxes
a. The City will use its resources and means to ensure a
diverse and stable property tax base.
b. The local taxing effort of other cities and unincorporated
areas as well as the demand and need for local public
services will be the major considerations in determining
the City’s millage rate.
5. Grants
a. The City will pursue federal, state and private grants but
will strictly limit financial support of these programs to
avoid commitments beyond the availability of the grant
funding source.
b. With limited exception new positions funded by grants
shall only be authorized as contract positions. Existing
positions that lose grant funding shall be considered new
position requests if it is determined that the City will
assume funding for their function.
Office of Business and Financial Services
Management and Budget Section 2100.3
Policies and Procedures Manual Page 5
6. Designation of Funds
All revenue received shall be used to support the ongoing
operation of the City and shall not be designated for a specific
purpose or expenditure. The only exceptions to this policy are
when the enabling legislation for the revenue specifically
requires a designation or separation of funds, or if funds are
received by the City by a donor and can only be used for a
specific purpose.
:5 FORMS
None
:6 COMMITTEE RESPONSIBILITIES
None
:7 REFERENCE
Procedure adopted by City Council February 26, 2007, Item A5; amended
November 1, 2010, Item A-2.
:8 EFFECTIVE DATE
This procedure effective 11/1/2010.