In order to excel as a full-service community, strong fiscal management is required to ensure that financial obligations are met, all while anticipating future demands that may have an impact on City programs and services.
Tax dollars collected by the City are used to materialize resources into services – plans into action – and provide citizens with the exceptional quality of life that makes Westerville a nationally renowned destination in which to live and do business.
To measure and monitor its financial resources, the City utilizes fund accounting to track revenues and expenditures as they relate to the delivery of programs and services. Although there are several types of funds that differ in terms of purpose, size and revenue sources, all funds operate as an extension of the checkbook concept used at home: The balance of a fund is determined by adding revenues and subtracting expenditures from the existing balance.
Westerville City Council controls expenditures through the appropriation process. Only the appropriated amount can be spent, regardless of the balance in a fund. In certain instances, transfers or advances may be made between some funds, but this requires approval from City Council.
The City’s General Fund is used to account for all financial resources except those legally required to be accounted for in a different fund. Dollars make their way into the General Fund from a variety of sources, but the municipal income tax comprises the majority of these resources (see Chart 1). In 2014, the City’s General Fund operating expenditures are projected to be $4.6 million less than the $36.6 million of revenue collected (see Chart 2).
Funds other than the General Fund may be used to represent a department’s financial activity depending on the nature of the transactions involved. For example, the Parks & Recreation Department derives its financial resources from 0.25 percent of the City’s two percent income tax, as well as program fees, private contributions, grants, debt issuances for capital projects and General Fund transfers. As a result, a Special Revenue Fund is used to account for the department’s expenses, given that the revenues collected are designated for a specific purpose.
In addition to the municipal income tax, property taxes are another significant revenue source for the City. These tax dollars are collected by Franklin and Delaware counties and based on the estimated value of an individual’s property. Property tax dollars are then distributed by the counties to schools, municipalities, libraries and other qualifying entities.
In 2013, the City of Westerville received $13.6 million in property tax disbursements from Franklin and Delaware counties. The majority of property tax dollars were appropriated to the Fire Division and Genera Fund, in addition to economic development initiatives and resolving outstanding financial obligations (see Graph 3).
Each year, the City prepares a balanced five-year plan – a budget for the upcoming year and budget projections for the following four years. A long-term approach to budgeting seeks to anticipate changes in funding and financial forecasts and plan for upcoming challenges, effectively minimizing the impact of the unexpected.
“We take a thoughtful, strategic approach to fiscal stewardship,” said Westerville City Manager David Collinsworth. “By embracing a big-picture perspective, we craft and sustain a local financial climate that is marked by its strength and resilience, even during periods like the recent global recession. Our strengths shape how we are able to share with others and enable Westerville to continue our tradition of standing apart from the rest of the pack.”
The City's commitment to financial vitality has certainly paid off. In 2013, the City earned Aaa ratings from Moody’s Investor Services, Standard & Poor’s (S&P) and Fitch Rating Services – the highest achievable bond rating from all three major credit rating agencies. This stamp of confidence allows the City to fund capital improvement projects through debt issues at minimal interest rates, thereby saving taxpayer dollars.
Diligent financial recordkeeping and strict attention to detail are also notable hallmarks of the City’s accounting philosophy. In 2011, the City was awarded the prestigious Ohio Auditor of State Award with Distinction, a distinction that fewer than 5 percent of entities in the state of Ohio receive. The City has also received the Certificate of Achievement for Excellence in Financial Reporting from the Government Finance Officers Association for 30 consecutive years.
“Not only are we consistently recognized for our commitment to fiscal discipline, but we are also praised for our meticulous recordkeeping and reporting efforts, ensuring accountability and transparency in all City transactions,” said Westerville Finance Director Lee Ann Shortland. “We are proud to have earned the reputation as a trusted financial steward and fully intend to carry forward that legacy in future years.”
The 2014-2018 financial plan is currently available on the City website. To view this and other financial reports, please visit www.westerville.org/finance.
Chart 1
2014 Projected General Fund Revenues - $36,662,098
- Municipal Income Tax - $27,661,802
- Property Tax - $3,218,919
- Electric Kilowatt Hour Tax - $2,050,000
- Intergovernmental - $1,695,074
- Investment Earnings - $750,000
- Mayor’s Court Fines and Forfeitures - $635,803
- Planning, Development & Building Fees - $553,100
- Charges for Services - $64,400
- Miscellaneous - $33,000
Chart 2
2014 General Fund Expenditures - $32,041,675
- City Council - $275,280
- City Manager’s Office - $1,356,088
- Department of Administrative Services - $2,220,194
- Buildings and Grounds Maintenance - $838,402
- Finance Department - $2,915,292
- Management Information Systems - $2,424,302
- Mayor’s Court - $930,859
- Law Administration - $656,904
- Police Department - $13,933,747
- Communications - $1,896,642
- Department of Public Service - $932,577
- Department of Planning & Development - $3,661,388
- 2013 Property Tax Disbursements - $13,600,922.96
- General Fund: $2,855,248.91 (20.99%)
- Fire Fund: $9,187,526.51 (67.55%)
- General Bond Retirement: $176,250.12 (1.295%)
- Economic Development Initiatives: $1,381,897.42 (10.16%)
