Introduction of Five Year Financial Forecast Presented to the City Council by Karen Montgomery Assistant City Manager March 10, 2009

Introduction of Five Year Financial Forecast 1/17/2019 5:15 AM Introduction of Five Year Financial Forecast Second Annual Economic Forum Starting point: Re-estimate through Jan. Re-estimate details scheduled for 3/24 Forecast illustrates growing difference between revenues and expenditures City Council began addressing challenges with FY 2009 budget Economic downturn now anticipated to severely impact City of Fort Worth FY 2010 Budget process will address SAY health is 1% is only about $270000 Personnel services are 69% of budget

RETIREE HEALTH CARE COST GASB # 45 1/17/2019 5:15 AM RETIREE HEALTH CARE COST GASB # 45 Requires the "measurement, recognition, and display of other postemployment benefits, expense/expenditures, related liabilities and note disclosures in the financial statements." 2007 Comprehensive Annual Financial Report Effective for the City of Fort Worth for year ended 9/30/08 Unfunded Actuarial Accrued Liability: as of 9/30/08 $986 million Annual Required Contribution (73% to General Fund; 27% to other funds) $103 million Current payments for premiums/claims ($20 million) Additional payments (in FY 2009 budget)* ($ 5 million) Remainder to be funded annually ($55 million for GF or $10.9 million for 5 years) $ 78 million * City Council increased contributions and eliminated funding for employees hired on or after 1/1/09 to begin addressing liability

Employees Retirement Fund Anticipated Contribution Increases 1/17/2019 5:15 AM Employees Retirement Fund Anticipated Contribution Increases Substantial losses due to market downturn in 2008 (29.3%) Actuarial valuation with updated contribution requirement not available until 4/22/09 Conservatively estimated additional City contributions of 2% in FY 2010 and 2.24% in FY 2011 Brings total average contribution rate to 20% No estimate of potential additional employee contributions Results in an additional $5.4m in 2010, and $6.4m more in 2011 - 2014

Summary City Council took longer term approach with the FY 2009 budget 1/17/2019 5:15 AM Summary City Council took longer term approach with the FY 2009 budget Began making difficult decisions More challenges ahead, but easier based on FY 2009 decisions City of Fort Worth has overcome challenges in the past, will do so again Will prioritize services to minimize impact on community with FY 2010 Budget