1. Financial Management Policy Statements Annual Update and Review Presented to City Council by Lena H. Ellis, Director / CFO October 27, 2009

2. Financial Management Policy Statements On October 22, 2009, the Audit & Finance Advisory Committee recommended this presentation be shared with the full Council.

3. 3 The Financial Management Policy Statements (FMPS):  Provides sound financial management strategies to meet the present and future needs  Establishes a broad policy framework for financial management  Requires annual adoption per State Public Funds Investment Act Financial Management Policy Statements

4. 4 1)FMPS establishes the framework for detailed policy and procedure development.

5. 5 + 2) Detailed policies dictate what to do given a specific fiscal event.

6. 6 1) FMPS establishes the framework for detailed policy and procedure development. + 2) Detailed policies dictate what to do given a specific fiscal event. + 3) Department procedures prescribe how to perform the work detail Light Gray GreenTanBlue Dark Gray

7. 7 1) FMPS establishes the framework for detailed policy and procedure development. + 2) Detailed policies dictate what to do given a specific fiscal event. + 3) Department procedures prescribe how to perform the work detail. = 4) Comprehensive set of Administrative and Accounting Controls to achieve organizational fiscal goals and objectives.

8. 8 Comprehensive Guidelines Accounting Detailed Policies Budget Policies Fiscal Procedures Comprehensive Plan Financial Management Policy Statements

9. 9  Provide an overview of significant changes to FMPS  Other changes have been made to:  Provide additional detail  Consistency with FY10 Adopted Budget FMPS Update

10. 10 I. Revenues:  Section I. Revenues from Gas Well Development Leases:  Reflects changes made to Public Funds Investment Act during 2009 legislative session.  Bonus Royalty and Revenue Management expanded to include “other natural gas fee related revenue” including pipeline easements and license agreements.  Pipelines in Public Rights of Way:  New section  Revenues from Public Rights of Way will be deposited in the General Fund for the purpose of offsetting costs associated with reviewing and managing the pipeline locations in relation to other utilities. FMPS SIGNIFICANT CHANGES

11. 11 I. Revenues:  Section J. DFW Airport Car Rental Revenue Sharing:  Section modified for consistency with FY10 Adopted Budget.  Previously outlined the distribution of car rental revenue between arts programming and the Fort Worth Convention Center and Will Rogers Memorial Center.  Revision dedicates revenues solely to facility improvements of the Fort Worth Convention Center and the Will Rogers Memorial Center. FMPS SIGNIFICANT CHANGES

12. 12 I. Revenues:  Section K. Water and Sewer Payment-In-Lieu-of- Taxes (PILOT):  Section added for consistency with FY10 Adopted Budget.  Outlines purpose and calculation method of PILOT. III. Fund Balance/Retained Earnings:  Section E. Culture and Tourism Fund Undesignated Fund Balance:  Section modified for consistency with the FY10 budget.  Increases reserve requirement from 10% to 20%.  Results from Public Events Department move from General Fund to Culture and Tourism Fund. FMPS SIGNIFICANT CHANGES

13. 13 XIII. Retirement System:  A. Retirement Fund  Section enhanced  3. Funding Level: If the Retirement Fund funding levels reach insufficient levels, staff will update the City Council of the deficiency and make recommendations for corrective action.  B. Health Fund:  New section  Update the Council of any actuarial impacts resulting from benefit changes.  Update the Council if funding levels become insufficient and make recommendations for corrective action  Provide assumptions in the Proposed Budget related to the actuarially determined Annual Required Contribution (ARC) and the period of time necessary to fully fund the ARC. FMPS SIGNIFICANT CHANGES

14. Next Steps Staff will seek the approval of the Financial Management Policy Statements November 10 th Council will be presented with a draft on other policies (budgetary) January 15 th Council will deliberate, clarify and provide direction to staff on budget policies and priorities March/April Council will finalize and begin to memorialize such decision

15. 15 Next Steps  Financial Management Policy Statements will be updated and recommended for review and approval as needed

16. Financial Management Policy Statements Annual Update and Review Presented to City Council by Lena H. Ellis, Director / CFO October 27, 2009

17. Recommended Language for Affiliated Agencies A number of agencies have been created through City Charter, Council action, intergovernmental agreements, and statute and federal laws. These agencies are affiliated with the City and should be managed with the same financial standards and regulations as City agencies. To protect the City’s fiscal status and avoid an adverse effect on the City, affiliated agencies will be accountable for financial compliance and reporting standards as described in the City’s Financial Management Policy Statements. The City may audit financial records or performance data to ensure funds are spent in accordance with Council directions and policies. Affiliated agencies include, but are not limited to, agencies created by City Charter or Council action, agencies with leadership appointed by the City Council and agencies that receive a majority of their funds from the City.

18. Investment Policies Presented to City Council by Lena H. Ellis, Director / CFO October 27, 2009