2011 Popular Annual Financial Report

Challenge, Change, Celebrate, Congratulate and Consider the Possibilities

City of Arlington Popular Annual Financial ReportFoR the yeAR ended SePtembeR 30, 2011

Popular Annual Financial Report for 2011 2 “Challenge, Change, Celebrate, Congra

dear Reader,

The Arlington City Council and I are honored to present the 2011 Popular Annual Financial Report: Challenge, Change, Celebrate, Congratulate, and Consider the Possibilities. Just as we believe it is our responsibility to be good stewards of our City’s resources and make decisions in the best interest of the citizens of Arlington, it is also incumbent upon us to do our work in an open and transparent manner. This report allows us to do just that, and is an essential element of responsible government.

In a sense, 2011 represented a turning point for Arlington. Against the backdrop of a national economic recovery, which seems fragile at best, we see signs of real progress and success. Although budget decisions have not been easy, Arlington has fared better than other cities across North Texas and across the nation. This fiscal year ended with a $3 million dollar budget surplus.

This budget surplus was accomplished due to innovative approaches in service delivery and key investments that have secured our revenue base. It is also the result of our ability, Council and staff, to work diligently to manage the demands of a $400 million budget. It is a challenging

Message from the Mayor

Message From the Mayor ................... 2

City Council........................................ 3

Message From the City Manager’s Office ......................... 4

Strategic Performance Plan ................ 5

A Look Back ....................................... 6

Strategic Planning Cycle ..................... 8

Community Profile ............................. 9

Neighborhoods ..................................10

Economic Development .....................12

Capital Investments ...........................14

Strategic Support ..............................16

Achievements in Service ....................18

Financial Highlights .......................... 20

A Look Forward ................................ 23

task, requiring skill and negotiation, and a deep commitment to the changing needs of our community.

Auditing and reporting the City of Arlington’s financial status is an equally important responsibility. To that end, staff throughout the organization works closely with Finance to ensure transactions are correctly calculated and posted. Council and I receive regular briefings on the City’s financial position and have the opportunity to make budget adjustments as needed.

In 2011, we had reason to celebrate. Arlington hosted a World Series, becoming one of the first cities to host a Super Bowl and World Series within a 12-month period. In fact, our Entertainment District is one of the most important economic drivers in the City. While total tourism output has declined by 6.4 percent for all of the United States since 2008, in Arlington it is up 8.4 percent. Overall crime is down and continues a steady decline that began four years ago. Viridian, a multi-phase, multi-year 2,300-acre $2 billion development project was launched in May, and General Motors recently broke ground on a major expansion.

There is a sense of optimism as 2011 ends. I’m proud of the work that has been done by Council and staff, and offer this report on the financial status of our great City. I invite you to join us as we take a look back and celebrate our successes.

Sincerely,

Robert n. Cluck, m.d.Arlington [email protected]

In this report

3tulate, and Consider the Possibilities”

2011 City Council

(Back row left to right)

Gene Patrick, District 8, At-Large

Robert Shepard, District 6, At-Large

Kathryn Wilemon, District 4, Mayor Pro Tempore

Robert Rivera, District 3

Jimmy Bennett, District 7, At-Large

(Front row left to right)

Sheri Capehart, District 2

Robert n. Cluck, mayorLana Wolff, District 5

Mel LeBlanc, District 10, Deputy Mayor Pro Tempore

The Arlington City Council consists of a mayor and eight council members elected by the voters of Arlington. Five are elected from districts to represent geographic parts of the City. The mayor and three at-large districts are elected by the entire City. Members serve two-year terms with annual elections in May.


Message from the City Manager’s Office

Dear Arlington Residents:

I am pleased to present the City of Arlington’s Popular Annual

Financial Report. Within this document, we summarize our City’s

financial operations and highlight the service delivery strategies

that shaped Arlington during the fiscal year ending September

30, 2011. This report is part of our continuing efforts at open

government, which enhances the level of fiscal accountability to

our residents.

The 2011 budget was presented with the promise

of an economic turnaround on the horizon in

Arlington. After a number of challenging years,

we are pleased to announce a budget

surplus, the result of considerable analysis

and review of both revenue sources and

programs. Critical

community priorities were maintained and the City’s sound

fiscal policy principles led us through tough economic times

in strong condition. Solid partnerships and smart investments

strengthened the foundation for growth in Arlington in 2011 at a

time when cities across the rest of the United States struggled to

find a place in the economic recovery.

Although this report provides a condensed and simplified

analysis of our revenues and expenses, it is designed to help

you understand how Arlington City government works.

This report highlights some of our City’s most

significant accomplishments in 2011 with

financial forecasts and anticipated challenges

for 2012 and beyond, as we strive to

maintain our current level of economic

stability and encourage further development

and growth.

The Popular Annual Financial Report is based

on audited financial documents contained in the

2011 Comprehensive Annual Financial Report and is a

summary of our financial outcomes in FY 2011.

This report is about your City and community. If you

have questions or comments, please contact the Office

of the City Manager.

City of Arlington

City Manager’s Office

817.459.6100

CIt

y oF ARlIngton, texAS

CIty mAnAgeR’S oFFIC

e


Strategic Performance Plan

Vision Mission VALUEsArlington is committed to being a pre-eminent city, providing an exemplary environment

in which to live, learn, work and play.

Vision Mission VALUEsThe City of Arlington enacts the will of the people through their active, inclusive participation

and provides the services they demand in a quality, cost effective manner.

Vision Mission VALUEs

• The City provides outstanding customer service• Staff exceeds expectations in delivering core service and

daily operations• Uphold the highest professional and ethical standards• City values diversity, creates positive relationships and

maintains effective partnerships with the community and organizations

• City achieves results through planned actions and measurable performance

Working Together To Make Arlington Better Responsiveness and Respectful to our customers and co-workers

innovative in identifying possibilities, exploring options, and creating solutions

Committed to excellence

Relating to our customers and each other with integrity

Vibrant downtown

Energy efficiencies,

Environmentalstewardship

Protect from flooding, erosion

Focus onmobility;Capital

Investment

Grow/diversifyeconomy, utilizing

redevelopment opportunities

Coordinate programs to

support youth, seniors, families

Cultural, recreational, and learning opportunities

Enhance, preserve

neighborhoods;Safe anywhere,

all the time

Neig

hbor

ho

ods Econom

ic Development Capital Investm

ent

Customer service; Fiscal stewardship;Quality employer;Create/coordinate effective regional and community

partnerships

Strategic Support

Convention and tourism

the City’s Performance Plan outlines the community’s vision, mission, priorities and values in 2011.


F

Financial Look Back at 2011

Fiscal year (FY) 2011 began with the theme from the City

Manager’s Office of “Challenge, Change, Celebrate, Congratulate,

and Consider the Possibilities.” Those concepts certainly applied to

the City’s finances in FY 2011.

Cities throughout the nation were looking for ways to continue

providing services in the midst of an economic crisis. Most of us

faced layoffs, employee benefit reductions, and service contraction. In

looking back, here are some significant events related to our finances

that occurred in 2011.

Challenge

During this fiscal year,

the entire country

continued struggling

with the challenges

of the economic

downturn. Until

now, Arlington had

been spared most of

the negative effects

of the precarious

real estate market.

However, that

changed in FY 2011.

In 2010, the City saw

a drop in property

values of about .4

percent; but in 2011,

we saw a decline of 5.7 percent or the loss of over $1 billion in

property value. This was the largest decline in over 25 years, and as

property tax is the largest revenue source for the General Fund, it had

a significant impact on City operations.

City departments were forced to consider alternate revenue

options and expenditure reductions to balance the budget. The

City created a Business Continuity Reserve. The organization was

struggling with recurring revenue shortfalls, but had one-time sources

of funds available, partially due to natural gas drilling. To avoid using

one-time money for recurring expenses, the “Challenge Grant”

program was created. Departments were asked to identify programs

that were least impactful to service delivery and then request

challenge grants to provide interim financing for these programs until

alternate service delivery models or funding were identified. If the

program could not be re-engineered or funded by another source, it

would be eliminated in the FY 2012 Budget.

Another challenge that Arlington and other cities across the

nation faced was maintaining our bond rating during these difficult

economic times. Arlington has traditionally earned healthy bond

ratings from Standard & Poor’s, Fitch, and Moody’s. Because we have

maintained our focus on financial principles and a strong emphasis

on the integrity of our finances, we have been able to sustain our

AA+ and Aa1 bond ratings. Standard & Poor’s said, “Arlington’s

financial management practices are strong, well embedded, and likely

sustainable.” According to Fitch, “The City has maintained budgetary

structural balance and sizable operating reserves amidst recessionary

pressures due to prudent budgeting practices and timely expenditure

reductions.”

Change

In FY 2011, the City issued debt for its new stormwater utility

for the first time. Approximately $25.6 million in revenue bonds was

issued for property purchases and construction projects. A substantial

portion, $16 million, was spent to purchase 49 residential and 101

condominium properties along Rush Creek, a frequently flooded

tributary in Arlington.

”

“ Arlington’s financial management practices are strong, well embedded, and likely sustainable.



Despite the challenging economy, the City was able to issue $15.6

million in General Obligation Bonds and $1.7 million in Certificates

of Obligation for capital improvement projects. The City’s Water

Utility issued $13.8 million in revenue bonds for water and sewer

improvements. We were able to take advantage of low interest rates

and did $53 million in bond refundings, saving the City $2.9 million.

Celebrate

Super Bowl XLV was a significant celebration for the City in FY

2011. Thanks to sales and occupancy tax generated by the event, the

City was able to cover all of its expenditures associated with the big

game.

Fiscal year 2011 also saw the Texas Rangers go to the World

Series. The associated sales and occupancy taxes generated by

residents and visitors to Arlington allowed sales tax to remain strong.

We ended a tough year one percent over expected sales tax revenues.

Congratulate

The City was fortunate to be recognized for its strong financial

condition and its financial transparency.

The City of Arlington was recognized for a second time by the

State of Texas Comptroller of Public Accounts for meeting the highest

standards in financial reporting and transparency by making financial

documents readily available to the public. The City’s first award for

financial transparency was in 2010.

The Texas Comptroller Leadership Circle program, launched in

December 2009, recognizes local governments that strive to meet

high standards for financial transparency. The City of Arlington

supports fiscal transparency, believing that citizens should know how

their tax dollars are being spent. The City posts its Annual Operating

Budget, Annual Business Plan, Comprehensive Annual Financial

Report (CAFR), Popular Annual Financial Report (PAFR), and check

register online. The City also publishes its Quarterly Budget Analysis

Report online.

The City was also recognized by the Government Finance

Officers Association (GFOA) with their Certificate of Achievement for

Excellence in Financial Reporting for the FY 2010 CAFR, and met

the Security and Exchange Commission’s transparency requirement

through continuing financial disclosure. The City also received the

Distinguished Budget Award from GFOA.

Fiscal year 2011 proved to be a year to “Challenge, Change,

Celebrate, and Congratulate.” Arlington has risen to the challenges

created by the sluggish

economy, ensuring the

organization can operate

efficiently and effectively

in a time of declining

revenues. City staff,

working with the Mayor

and City Council,

made decisions that

have demonstrated

that they are good

fiscal stewards of

taxpayer dollars.

At the end

of this report, as we

look forward, we will

finish out the theme

from the City Manager’s

Office and “Consider the Possibilities.”


Arlington Financial Cycle

C

AFR

Repo

rting Strategic Planning

JANUARY

OCTO

BER

NO

VEM

BER

DECEM

BER

FEBRUARYMARCH

APRIL

MAY

JUN

E

JULY

AUGUST

SEPTEMBER


JAN• External Auditor & staff begin work on CAFR

& single audit• 1st QTR business plan & budget compiled• City Council coordinates strategic planning

session for upcoming fiscal yearFEB• 1st QTR business plan/budget reviewed by

deputiesMAR• CAFR/PAFR completed• City Council approved• Official statement updated

APR• 2nd QTR BP/budget compiled• Potential bond issuance• Rating agency review/OS update• Budget kick off• CAFR/PAFR submitted ot GFOAMAY• Deputies review 2nd QTR BP/budget• Department BP & budget modifications

/proposals due for next year• Preliminary revenue for upcoming

fiscal year determinedJUN• Deputies budget & BP• Modifications & proposals reviewed &

prioritized • Proposed budget discussion with City

Manager

JUL• 3rd QTR BP/budget compiled• CMO & OMB finalize proposed budget• Certified tax roll received from Tarrant

Appraisal DistrictAUG• Deputies review 3rd QTR BP/budget• Proposed budget presented to City Council• Budget town hall meetings conducted with

residentsSEP• Budget development discussion with City

Council• Budget adopted

OCT• 4th QTR BP/budget compiled• Finance discussions begin• Fund closings• Citizen survey developedNOV• 4th QTR BP/budget reviewed by

deputies• Fund closing continues• Budget document finalizedDEC• New budget submitted to GFOA• Citizen satisfaction survey completed

CAFR . . . . . Comprehensive Annual Financial Report

PAFR . . . . . . . . . . . .Popular Annual Financial Report

BP . . . . . . . . . . . . . . . . . . . . . . . . . . Business Plan

OS . . . . . . . . . . . . . . . . . . . . . . . Official Statement

GFOA . . . . Government Finance Officers Association

CMO . . . . . . . . . . . . . . . . . . . . City Manager’s Office

OMB . . . . . . . . . . Office of Management and Budget


W

Arlington, Texas City Profile

What started as a small rural farming community in 1884 has

blossomed into the nation’s 50th largest city; and with more than

365,000 residents is the seventh largest city in Texas.

The 99.7-square-mile City of Arlington is located approximately

20 miles west of downtown Dallas and 12 miles east of downtown

Fort Worth.

Arlington is a community rich in culture, tradition and history,

which has helped it transform into a travel destination. The City

houses several family-friendly attractions including Six Flags Over

Texas, Hurricane Harbor and the International Bowling Campus, in

addition to plenty of shopping and dining options. Sports fans come

from near and far to see Cowboys Stadium and the Rangers Ballpark

in Arlington, which have held national events like the Super Bowl and

World Series.

FACtS & FIgUReS

2009 2010 2011Population 370,450 365,438* 365,930

General Obligation Debt per Capita $827 $933 $901

Labor Force 210,017 208,628 209,258

Unemployment Rate 7.6% 7.5% 8.0%

Housing Start Permits Issued 251 284 230

Foreclosures (residential and commercial) 1,187 1,262 914

Occupancy Rates

Office 87.9% 85.3% 88.0%

Industrial 84.0% 85.7% 90.0%

Retail 91.5% 92.0% 91.6%

Residential (Multi-family) (North and South no longer tracked separately) 92.1%

North Arlington - 4th Quarter 90.0% 93.0%

South Arlington - 4th Quarter 92.9% 91.0%

* *2010 population is based on latest census data. Other population data is estimated.

Arlington is also home to great medical and learning institutions

like University of Texas at Arlington, Tarrant County College, and

Arlington, Mansfield, and Kennedale Independent School Districts.

Transportation infrastructure in and around Arlington has

long been a prioity, ensuring that the City’s residents and visitors

can come and go smoothly. A local sales and use tax for street

maintenance continues to provide additional funding for repairs of

neighborhood streets and thoroughfares.

The local economy is strengthened even more by the presence

of quality neighborhoods, numerous parks, libraries, commercial

development for small and large businesses, and the Arlington

Municipal Airport, which provides corporate and leisure aviation

services.

For more information, visit ArlingtonTx.gov.


F

Neighborhoods

From new outdoor initiatives to further development of literacy

programs and continuation of community assistance initiatives, the

City of Arlington positively impacted residents’ quality of life during

the 2011 fiscal year.

outdoors

Arlington opened its first barrier-free playground at Randol Mill

Park to accommodate the City’s 6,000 children with disabilities.

The playground, designed to allow every child easy access to all the

play structures, was made possible by funds approved by voters in

the 2005 Parks Bond Election, a $1,000 grant from the Arlington

Tomorrow Foundation, and community partnerships with Crown Plaza

and Source Corp.

“It was important to us that every detail in this new playground,

no matter how small, was considered,” said Stephen Booher, a

member of the Helping Restore Ability Board of Directors. “Today, we

have a park facility we can all be proud of.”

A partnership with Chevrolet and EcoMedia funded green

improvements at Randol Mill Park. EcoMedia’s EcoAd program,

which Chevrolet participates in, sets aside a portion of advertising

dollars for eco-friendly projects. Chevrolet’s EcoAd grant funded

upgrades to the park that included sustainable landscaping around

the playground, newly planted trees, and solar panels on new

buildings.

Along the green theme, the University of Texas at Arlington and

the City collaborated to create a first-of-its-kind community garden.

Seventy-eight garden plots were created on the university campus to

encourage healthy eating, promote sustainable food production for

the local community, and preserve open green spaces. As part of the

lease agreement, plot owners agree to donate at least half of their

harvest to nonprofits like Mission Arlington, which received its first

harvest in July.

For the outdoor enthusiast, a new 4.2-mile paddling trail on the

Trinity River at

River Legacy Parks

was dedicated

in 2011. It is the

second paddling

trail in Arlington,

Lake Arlington’s

11-mile paddling

trail opened in

2008.

”

“ Today, we have a park facility we can all be proud of.


Neighborhoods

Improving literacy

The Rotary Club of Arlington’s free adult English class was so

popular that the City joined forces with the club and First United

Methodist Church to open the Literacy House. The house allows

volunteers to reach even more residents with English as a Second

Language courses, GED preparation classes, and reading and writing

classes for all ages.

To make it easier for residents to access the Arlington Public

Library system, the City created LibraryLiNK sites at select Arlington

ISD and Mansfield ISD elementary schools. LiNK sites act like normal

library branches to encourage families to use the libraries together.

Community Assistance

The Weatherization Assistance Program, established in 2009

with funds from the U.S. Department of Energy, helped more

than 400 low-income households become more energy efficient

during the program’s existence. Local companies Brennan

Enterprises and NT Windows also worked with the City to

weatherize houses, donating and installing energy-efficient

replacement windows in many homes.

Recognizing an opportunity to help residents find jobs,

Arlington launched Ride 2 Work in January of 2011. The program

provides low-cost transportation for residents to work-related

activities like job training, interviews, and child care within the

City.

Arlington also worked to better residential areas. The Town North

neighborhood needed safer sidewalks for children going to school

on foot, so the City used a federal grant and assistance from the

Arlington Tomorrow Foundation to construct a safer sidewalk system

that also addressed previous drainage issues.

Trying to reach as many residents as possible, the City used

social media for the first time to solicit entries for Arlington’s fifth

pet calendar. A huge success, the calendar raised $2,500 for the

Animal Services Center, which encourages responsible pet ownership

through a variety of programs.


Economic Development

“This represents the intersection of downtown revitalization and

a vibrant university,” said UT Arlington President James Spaniolo.

“We truly believe that partnering together and putting a strategy of

implementation together is so important to the future of our City.”

Nearly 400 companies in the Downtown Business Improvement

District began paying a self-assessment in 2011, the first year of

a five-year term. The assessment raises money for the Downtown

Arlington Management Corporation, which is credited for developing

Babe’s Chicken Dinner House, the Levitt Pavilion, Founders Plaza,

and Fuzzy’s Tacos.

A Tax Increment Reinvestment Zone (TIRZ) allowed Dodson

Development to turn a vacant hotel furniture building on Abram Street

into the Flying Fish restaurant. The TIRZ provided public funding to

redevelop the area, making it easier for the restaurant to open. Flying

Fish employed 25 workers when it opened its doors in June.

Other new downtown restaurants include Mellow Mushroom

pizzeria, Grease Monkey Burger Shop & Social Club, and the Twisted

Root Burger Company.

Gypsy Riddles Boutique &

Gallery, a shop that offers

one-of-a-kind fashion

pieces and local art, also

opened its doors in the

heart of Arlington.

Creating Jobs through

expansion

City Council passed

an ordinance establishing the General Motors site as a reinvestment

zone and approved an incentive package to encourage GM to

continue making investments in the Arlington plant. As a result, GM

announced that the Arlington Assembly Plant was selected over other

U.S. locations to receive $331 million in plant renovations.

D Despite a rough economic year nationally, Arlington’s leadership

was able to make considerable progress with several initiatives and

create new jobs for the community.

Invigorating downtown

Arlington and the University of Texas at Arlington partnered to

build an 1,800-vehicle parking structure downtown in the University’s

new College Park District, which features residential and retail

development. Residents and visitors can use the garage for events at

the new 7,000-seat College Park Center, the Levitt Pavilion, and for

dining and shopping outings.

”

“ This represents the intersection of downtown revitalization and a vibrant university.


Economic Development

With the expansion, GM will add an estimated 110 positions

to its existing 2,324 full-time employee base. The net benefit of the

proposed plant expansion during the first 10 years is predicted to be

$5.5 million.

moving Forward With new developments

Arlington and Huffines Communities officials broke ground on

Viridian, a $2 billion mixed-use development comprising 2,300 acres.

Viridian will feature custom homes, shops, restaurants, offices,

more than 20 miles of trails, and 1,100 acres of protected wetlands.

Residents are expected to begin moving into the

development in the fall of 2012.

hosting the World Series & Super bowl

Arlington was lucky to host the World Series

and Super Bowl XLV only months apart. The Texas

Rangers’ playoff run to the World Series netted the

City an estimated $1.3 million in sales tax revenue

from the crowds at the Ballpark alone.

Local businesses benefited as well. For

instance, Bobby V’s saw a 25 to 30 percent

increase in its customer base during the baseball

series.

The Super Bowl brought an estimated 200,000 visitors on

game day, and about 70 aircraft landed at Arlington Municipal

Airport.

Beyond the economic impact, Arlington benefited from

Super Bowl outreach programs. Several Arlington homes were

renovated, Speer Elementary received a new playground, and

45 new Habitat for Humanity homes were built.


Capital Investments

A Arlington continued its efforts to attract new corporations, as well

as preserve the environment during the 2011 fiscal year.

Attracting new businesses

Arlington Municipal Airport, which generates $100 million a

year in economic activity, opened a $5.2 million terminal with the

goal of attracting additional economic development. A portion of the

construction costs were paid by a $600,000 state grant and interest

earned on the airport’s natural gas revenue. The terminal is the City’s

first LEED-certified building, a nationally accepted benchmark for

the design, construction and operation of high-performance green

buildings.

Reinvesting in Arlington

The I-30 Mobility Improvement Project – a $166 million

collaboration between area businesses and federal, state, and local

governments – wrapped up after three and a half years. Two new

bridges, one reconstructed bridge, continuous one-way frontage

roads, murals, lighting, landscaping, and an extension of the region’s

reversible HOV lanes were included in the project between Cooper

Street and Ballpark Way. The 118,000 vehicles that travel through

Arlington daily on I-30 now have a smoother, safer commute.

The eight-story City Office Tower, in downtown Arlington, was

in need of improvements. Arlington began a $2.3 million renovation

on the building that included replacing single-pane window panels,

installing a new air system, and

renovating restrooms to make

them ADA compliant. The

updates were financed in part by

a $3.4 million federal stimulus

grant the City received in 2010.

The renovations will save the City

$78,000 annually in energy costs.

”

“ We are stewards of the public’s trust and funds.


Capital Investments

Saving money While Conserving Water

As part of a regional initiative to save water and match the type of

water used daily to our actual needs, the City began using reclaimed

water. Reclaimed water is a highly treated wastewater that is

perfect for landscape irrigation, fountains, fire protection, and power

generation. Using reclaimed water to irrigate makes more drinking

water available, which is especially important in times of drought.

Trying to help college students cut back water usage, Arlington

Water Utilities’ conservation program purchased 1,600 low-flow

showerheads that are expected to save 14.2 million gallons of

water yearly. The showerheads were installed in the summer at UT

Arlington’s residence halls and other student housing areas. The new

showerheads are also expected to save more than $100,000 a year

in water, sewer, and natural gas fees.

new Ideas Spark Savings

In a pilot program started in March, the Arlington Fire

Department began sending light response vehicles – SUVs equipped

with medical equipment – to emergency medical calls instead of

dispatching fire engines. Fire officials

indicated the smaller vehicles were handling the medical calls just as

well. Utilizing light response vehicles also improves safety by freeing

up the fire engines to respond to life-threatening fire emergencies.

The program’s initial results suggest that using light response

vehicles could save about $11,500 a year in fuel expenses alone.

Additionally, the light response vehicles cost $500,000 less than fire

engines, and using them can extend the warranty and life of engines

for years.

“We are stewards of the public’s trust and funds,” said Fire Chief

Don Crowson. “We will always be there for emergencies, but we

need to be as efficient as possible in doing so.”


Strategic Support

B Besides investing time, energy and money into bettering the

community, the City also focuses on improving its efficiency.

Customer driven

Arlington created the Supplier Portal to make it easier for area

businesses to participate in the City’s bid and proposal processes. “In

a tight economy, helping suppliers find contracting opportunities is

crucial to the community, and ultimately benefits Arlington’s object of

open competition,” said purchasing manager Debra Twinam.

The Supplier Portal allows vendors to register their businesses

with the City, upload and store certificates, enter appropriate

commodity codes, and be notified about potential bid opportunities.

Staying on the cutting edge of technology, the City launched

iPhone and Android apps, and a mobile website prior to hosting

Super Bowl XLV. With more than 700 pages of content and many

capabilities, residents can do things like request building permits,

pay traffic tickets, or search for jobs on the mobile applications. Not

forgetting that Arlington is a travel destination, visitors can book hotel

rooms or check out the entertainment guide.

Additionally, Arlington launched an online store,

Arlingtonwebstore.com, where shoppers were able to purchase

Super Bowl XLV and World Series memorabilia, as well as make tax-

deductible donations to support expanding public library materials or

scholarship funds.

Because Arlington is so customer focused, the City made a point

to celebrate Customer Service Week and congratulate at least 50

employees who completed customer service training programs in the

prior year. The City’s Workforce Services Department offers several

training classes in customer service to ensure that it maintains a high

level of service.

Arlington also involves residents through its Municipal

Volunteer Program (MVP), which enhances citizen participation in

City government and helps residents assist City departments in

strengthening service delivery. MVP had a great year by increasing

the number of volunteers by 10 percent in 2011.

by the numbers Fy 2011

901 Employees Enrolled in Wellness Programs

3,951,509 City of Arlington Website Visits

19,219 IT Work Orders Processed and Closed

198,877 Action Center Calls Answered

80,964 Employee Payroll Paychecks Issued

241 Public E-mail Nixle Alerts Sent

24 E-Arlington City Newsletters Published

79 Original Public Meeting Broadcast Hours

$20,711,295 Municipal Court Revenue Collected

$952,557 Arlington Tomorrow Foundation Grants Awarded

”

“ In a tight economy, helping suppliers find contracting opportunities is crucial to the community.


Strategic Support

Revenue enhancement

As part of the Arlington’s revenue enhancement program, the

City teamed up with hometown company Texas Power to create a

two-year pilot program called PowerUp™Arlington. The program offers

competitive and reliable electricity service to the City’s residents

through Texas Power, and a portion of the proceeds goes to the

City. In the first year of the program, Arlington received more than

$20,700.

Preparing For the Future

The City launched two new high school programs to combat a

possible shortage in the future of qualified applicants in the Fire and

Water Departments.

The Arlington Fire Department worked with Tarrant County

College and Arlington Independent School District to develop a two-

year fire academy for high school students. Arlington ISD is the first

school district in the Metroplex to have this type of program, and the

first Fire Academy accepted 23 students.

Roughly one-third of water utility workers and wastewater utility

workers will be retiring in next 10 years, so

the City’s Water Department also worked with

Arlington ISD to develop a work-study program

that introduces the water industry to high school

students through classroom instructions and

hands-on internships.

After taking part in the program and

graduating from high school, students will be

qualified to find water utilities jobs or to pursue

college degrees in engineering and science for

more advanced careers in the water industry.


AArlington’s advancement and outstanding work in several areas was

recognized by various entities throughout fiscal year 2011. Here is

a sampling of the most significant accomplishments and awards

received by City departments and staff members.

Arlington transformed a declining neighborhood into a thriving

community of responsible homeowners when it constructed 11

new energy-star certified homes for resale to low-income, first-time

homebuyers on Jordan lane. The overall property value of the 11

homes increased by $845,960.

The City built a new data center to host critical City information

systems for disaster recovery. The data center has redundant power,

cooling, and network connectivity for reliability.

The City worked with Union Pacific Railroad to complete its new

quiet zone program along railroad tracks in north Arlington,

decreasing noise levels for nearby neighbors. Train engineers no

longer sound their horns when passing through Arlington.

Arlington Municipal Airport beat out 23 other airports to be named

Reliever Airport of the year by state transportation officials for

its work to meet the increasing demand for regional aviation. City

Council also

approved a lease

at the Arlington

Municipal

Airport for

Italian helicopter

company Agusta

US Inc., which

plans to invest

$2.5 million to

renovate a hangar

and build a 7,000-square-foot office building for an operations base.

The Arlington Convention Center grossed $225,000 – the most

the facility has ever grossed from a single event – when StubHub

distributed more than 10,000 tickets to Super Bowl XLV attendees

during the four days leading up to the big game.

Arlington Dispatch Services’ Angie Phillips was presented the

national 9-1-1 Call-taker of the year Award in Washington,

D.C., in March. Phillips instructed a 16-year-old with Asperger’s

Syndrome to bring a moving car to a stop on a freeway while his

grandfather was having a heart attack. The teenager followed

instructions that led first responders to the scene – just in time to

save his grandfather’s life.

Outstanding Achievements in Service

The City replaced an outdated mainframe system application with

e-builder software to track and manage capital improvement

projects. E-Builder is automating more processes, and its reporting

capabilities provide immediate visibility about the availability of funds,

how funds are being spent on ongoing projects, and the status of

different projects.

Arlington also replaced more than 26 different phone systems

citywide across 70 facilities with a new VoIP system. The new

system has a reliable architecture that allows staff to move to an

alternate facility and immediately begin taking calls in the event of an

emergency.


Outstanding Achievements in Service

Alliance for Innovation, an international network of government

professionals, presented the Arlington Urban Design Center its 2011

outstanding Achievement in Innovation Award. The Urban

Design Center is a place for graduate students and professors from

UT Arlington’s School of Architecture and School of Urban & Public

Affairs to work with City planning staff on development projects.

Among many of its projects was the design of building facades for

new development along West Abram Street in downtown.

Arlington Housing Authority executive director David Zappasodi

was presented a hall of Fame Award from the Texas Chapter of

the National Association of Housing and Redevelopment Officials

for his exceptional work. Some of his largest contributions are the

development of a 10-year plan to end chronic homelessness and the

successful implementation of a program that rehabilitates vacant,

foreclosed singled-family homes in Arlington.

The President’s

Council on Fitness,

Sports & Nutrition

honored Mayor Robert

Cluck with the 2011

PCFSn Community

leadership Award for

his Let’s Move with the

Mayor program that aims

to eliminate childhood

obesity. After two years,

the program, built on First

Lady Michelle Obama’s “Let’s Move” national campaign, involves

more than 4,700 Arlington ISD fifth-graders.

Arlington City Council member Robert Rivera was elected to the

Board of Directors of the national Association of latino elected

and Appointed officials, whose mission is to represent the

political, cultural, and regional diversity of the Latino community.

The International City/County Management Association’s Center

for Performance Measurement awarded Arlington a Certificate of

excellence, the highest award ICMA-CPM gives out, for the City’s

superior performance management.

With ten International Municipal Lawyers Association Fellows,

Arlington’s City Attorney’s office now holds the distinction of having

the highest number of ImlA Fellow designees of any municipality

in the U.S. and Canada. Ursula Patterson was designated a fellow last

year, and Ivan Bland and David Barber renewed their designations.

Assistant City Attorney Linda Frank received the galen Sparks

Award for outstanding Public Service by an Assistant City

Attorney from the Texas City Attorneys Association after her work on

an animal cruelty case involving more than 26,000 exotic animals.

For the third year in a row, the Government Finance Officers

Association recognized Arlington’s Popular Annual Financial

Report with an award for outstanding achievement.

For launching comprehensive iPhone and Android apps, the Office of

Communication won the Silver Circle Award from the City-County

Communications and Marketing Association and the bronze Quill

Award from

the International

Association of Business

Communicators.


Financial Highlights 2011

2009 2010 2011 government-wide (in thousands) Assets $2,623,614 $2,760,496 $2,769,116 Liabilities 826,194 873,331 862,993 Total Net Assets 1,797,420 1,887,165 1,906,123

Revenues Governmental activities excluding 318,192 336,507 332,469 Stadium Venue contributions Enterprise Funds 116,908 117,397 133,934 Total Revenues 435,100 453,904 466,403

expenditures/expenses Governmental Activities excluding 324,265 302,079 350,589 capital outlay Enterprise Funds 79,358 77,876 86,120 Capital Outlay - Cowboys Stadium 417,157 40,754 - Capital Outlay - Other 58,992 38,611 26,389

Infrastructure Assets - net of accumulated depreciation Governmental Activities 209,200 205,264 199,965 Enterprise Funds 489,197 524,638 534,610 Total Infrastructure Assets 698,397 729,902 734,575

Fund balance General Fund Nonspendable 835 1,163 1,244 Committed 500 500 1,622 Assigned 53,283 61,277 57,816 Unassigned 3,663 3,627 6,093 Debt Service Fund -restricted 48,685 58,696 38,130

long-term debt outstanding Governmental Activities 285,774 327,943 319,625 Enterprise Funds 100,407 110,120 143,256 Cowboys Stadium 302,229 297,056 262,212 TOTAL 688,410 735,119 725,093

Pension obligation - tmRS Funded 360,029 373,896 688,015 Unfunded 234,413 247,280 144,154 Percent funded 60.6% 60.20% 82.70%

Retiree benefit obligation Funded - - - Unfunded 104,500 100,900 109,100

Financial Trend SummaryThe financial data below is intended to provide a big picture overview of key financial metrics for the past three years. The information below is from selected funds and does not proport to represent all of the City’s component units. For ease of reading, this data is summarized in ways that are not in accordance with Generally Accepted Accounting Principles (GAAP) and the notes to the financial statements are not provided. The City of Arlington is audited annually and prepares a full GAAP-based Comprehensive Annual Financial Report (CAFR). The latest report is available to readers on the City of Arlington web site at www.arlingtontx.gov/finance/cafr_financial_reports.html. For more information about the CAFR or other financial reporting questions, contact the Financial and Management Resources Department at 817-459-6300.

Accountingterminology

Enterprise Funds Water, Sewer and Storm Water Utility funded by fees charged to users

Capital Outlay Funds spent to purchase or construct buildings, machinery, vehicles, etc.

Fund Balance The difference between assets and liabilities of a fund

Government-wide The City as a whole

Governmental Activities The City’s basic services such as Police, Fire, Public Works and Parks which are mostly funded by property tax, sales tax and franchise fees

Infrastructure Assets Stationary assets of the City that include streets, sidewalks, water, sewer and drainage systems

Net Assets The difference between assets and liabilities for the City as a whole

TMRS Texas Municipal Retirement System



trend Variances

• The City’s increase in total net assets of $19M this year is $70.7M

lower than the $89.7M increase last year. This variance is partly

attributable to the completion of the Cowboy Stadium Project. Last

year, contributions from the project were $37.3M. Because the

project was completed in 2010, there were no contributions in

2011. Additionally, last year $27.7M was included in contribution

income related to the one time transfer of assets from the dissolved

component unit, Arlington Sports Facilities Development Authority,

Inc. to the General Fund.

• The increase in total revenues of $12.5M is primarily attributable

to increased water sales due to the unusually hot 2011 North Texas

summer.

• Governmental expenditures increased $48.5M. This is the result

of expenditures in the Debt Service fund for the early mandatory

redemption of special tax revenue debt for the Cowboy Stadium.

This also caused a decrease in Debt Service fund balance of

$20.6M this year compared to last year.

• The Cowboy Stadium

construction is complete; no

additional capital outlay was

incurred for the project this

year. Capital outlay - other

decreased $12M compared

to last year due to less

spending on various capital

projects for municipal

facilities, airport and the

Entertainment District.

• Total infrastructure assets

increased $4.7M this year

due to additions to the City’s

water and sewer system.

• Total long term debt decreased $10M during the year. Debt

issues in 2011 include $54.28M in Permanent Improvement

and Refunding bonds, $1.8M in Combination Tax and Revenue

Certificates of Obligation, $17.2M in Water and Wastewater System

Revenue and Refunding bonds and $25.6M in Municipal Drainage

Utility System Revenue Bonds. Bond principal payments totaled

$109.1M on existing obligations.

• The funded portion of the TMRS pension obligation increased

$314M this year. The percent funded increased from 60.2

percent last year to 82.7 percent this year. This is the result of a

restructure of TMRS funds and updated actuarial assumptions for

their new fund structure.

Fy 2011 Important FactsFounded 1884

Incorporated 1887

2011 Population 365,930

County Tarrant

Assessed Property Values $17.2 Billion

City Tax Rate $0.6480 per $100 valuation

Sales Tax $86,219

Debt per Capita $901

Labor Force 209,258

Unemployment Rate 8.0%

Housing Start Permits Issued 230

Foreclosures - residential and commercial 914

Occupancy Rates - Office 88.0%

- Industrial 90.0%

- Retail 91.6%

- Residential-multifamily 91.2%

major employers 2011

• Arlington ISD • UT Arlington • Six Flags over Texas • The Parks at Arlington • City of Arlington • General Motors

major taxpayers

4.5 % of the City’s assessed value:• General Motors • Chesapeake Operating • The Parks Mall at Arlington • Oncor Electric Delivery • Arlington Highlands • Southwestern Bell



2009 2010 2011 Property tax base (in thousands) Personal $2,386,993 $2,604,015 $2,369,503 Real Estate $15,859,827 $15,647,090 $14,809,609 Total $18,246,820 $18,251,105 $17,179,112 Property tax Rate Operations 0.4467 0.4330 0.4393 Debt service 0.2013 0.2150 0.2087 Total 0.6480 0.6480 0.6480

Sales tax Revenue (in thousands) Amount $80,193 $81,517 $86,219 Annual growth -1.5% 1.7% 5.8%

Arlington has effectively managed its financial condition over the years, with a built-in conservative bias. City leaders are prepared to continue to manage City finances during the recession and will continue to take steps necessary to preserve Arlington’s Aa2/AA+/AA general obligation bond rating and the City’s ability to serve the public.

Debt Service$91,604Convention and Event

Services $6,194

Parks and Recreation$23,975

Public Welfare$11,045 Public Health

$3,737Public Works

$44,003

Public Safety$128,519

General Government$41,512

Governmental Activity Expenditures 2011(in thousands) $350,589

Long-Term Debt(in thousands)

Stadium$24,634

Street Maintenance Fund $12,317

General Fund$49,268

Sales Tax 2011(in thousands) $86,219

$800,000

$600,000

$400,000

$200,000

$0

Governmental activities Enterprise funds Cowboy Stadium

2010$327,943 $110,120 $297,056

2011$319,625 $143,256 $262,212

2009$285,774 $100,407 $302,229

Capital Assets - net of Accumulated Depreciation(in thousands)

$1,500,000$1,000,000$,500,000$250,000$200,000$150,000$100,000$50,000

$0

LandBldgs. & Imprvmnts.EquipmentConstruct. in ProgressInfrastructureTOTAL:

2010$215,103

$1,222,676$20,175

$199,902$729,902

$2,287,228

2011$216,388 $1,106,572

$18,164$201,449$734,575

$2,277,148

2009$211,393

$1,101,325 $24,345 $220,607$698,397$2,277,148


Services $6,194



$3,737Public Works

$44,003





Stadium$24,634


General Fund$49,268


$800,000

$600,000

$400,000

$200,000

$0


2010$327,943 $110,120 $297,056

2011$319,625 $143,256 $262,212

2009$285,774 $100,407 $302,229


$1,500,000$1,000,000$,500,000$250,000$200,000$150,000$100,000$50,000

$0


2010$215,103

$1,222,676$20,175

$199,902$729,902

$2,287,228

2011$216,388 $1,106,572

$18,164$201,449$734,575

$2,277,148

2009$211,393

$1,101,325 $24,345 $220,607$698,397$2,277,148


Services $6,194



$3,737Public Works

$44,003





Stadium$24,634


General Fund$49,268


$800,000

$600,000

$400,000

$200,000

$0


2010$327,943 $110,120 $297,056

2011$319,625 $143,256 $262,212

2009$285,774 $100,407 $302,229


$1,500,000$1,000,000$,500,000$250,000$200,000$150,000$100,000$50,000

$0


2010$215,103

$1,222,676$20,175

$199,902$729,902

$2,287,228

2011$216,388 $1,106,572

$18,164$201,449$734,575

$2,277,148

2009$211,393

$1,101,325 $24,345 $220,607$698,397$2,277,148

Total Revenues 2011(in thousands) $465,035

Taxes$209,077

Water and Sewer$123,442

Utility Franchise Fees$27,260

Charges for Services$20,836

Fines & Forfeitures$15,194

Leases, Rents and Concessions $8,791

Licenses and Permits$7,146

Interest Revenue and Change in Investment Fair Value

$4,678

Other$48,611


Services $6,194



$3,737Public Works

$44,003





Stadium$24,634


General Fund$49,268


$800,000

$600,000

$400,000

$200,000

$0


2010$327,943 $110,120 $297,056

2011$319,625 $143,256 $262,212

2009$285,774 $100,407 $302,229


$1,500,000$1,000,000$,500,000$250,000$200,000$150,000$100,000$50,000

$0


2010$215,103

$1,222,676$20,175

$199,902$729,902

$2,287,228

2011$216,388 $1,106,572

$18,164$201,449$734,575

$2,277,148

2009$211,393

$1,101,325 $24,345 $220,607$698,397$2,277,148


Looking Forward

looking Forward - Consider the Possibilities

Fiscal Year 2012 looks like it will, as in past years, be a period of

continued economic uncertainty. While Arlington’s economy appears

to be recovering, the strength and permanence of this recovery is

unknown. So as we look forward to FY 2012, we do so with a spirit of

“Hopeful Realism.”

Arlington has long prided itself on the ability to approach issues

realistically. We enjoy strong policy and fiscal leadership, effective

management, and productive, creative employees. We have a clear

understanding of current challenges, and continue to seek innovative,

long-term strategic solutions to balancing our budget.

We have been pleased to see that sales tax remains strong,

thanks in large part to the success of the City’s Entertainment

District. The City works diligently to nurture strong relationships

with the businesses in that district, as is evidenced by our 40-year

history with the American League Champion Texas Rangers. We

are also engaged in celebrating new economic growth in the City,

like the opening of the University of Texas at Arlington College Park

Event Center in February 2012, and the myriad of restaurants and

businesses that have chosen to locate in Downtown Arlington.

In 2012, the City will continue cultivating partnerships in the

community and looking for creative ways to collaborate on projects

and identify funding sources. A good example of this endeavor is

the creation of a Keep Arlington Beautiful Friends Group, a group of

volunteers that will seek grants and sponsorships, and will provide

community outreach designed to further the effort to enhance and

preserve neighborhoods.

The quality of our neighborhoods is an enduring focus for City

staff. This priority encompasses many departments and requires

a team approach to providing housing assistance, recreational

programs, and learning opportunities within our community. With its

focus on literacy and youth, the Library intends to purchase a mobile

computer lab, making technology and library resources accessible to

the majority of Arlington’s neighborhoods.

Arlington’s management team will also investigate possibilities for

generating new revenues by pursuing request for proposals to identify

a potential business and first-class hotel for the City-owned property

adjacent to the Convention Center; and we will continue to be good

fiscal stewards. For example, we will use a federal stimulus grant to

make much-needed improvements to the City Office Tower, a project

that is expected to yield 15 percent savings in energy usage and

reduce CO2 emissions by 19 percent.

As we continue to face challenges from the economic climate,

we realize that we must embrace the change that is inherent to those

challenges, stay hopeful about the future, and make decisions that

have the least impact on how we deliver services to our citizens. It

will continue to be necessary to work smart, make the best use of

the resources available to us, and always be ready to respond as new

opportunities and challenges present themselves.

So it is with “Hopeful Realism” that we prepare and position the

City of Arlington to meet these challenging times and maintain our

vision of Arlington as a pre-eminent city that provides an exemplary

environment in which to live, learn, work, and play.

City of Arlington, Texas

Popular Annual Financial ReportYear Ending September 30, 2011

Challenge, Change, Celebrate,Congratulate, and Consider the Possibilities

2011 Popular Annual Financial Report

Documents

Transcript of 2011 Popular Annual Financial Report