Glossary
r
r
r
r
I
n
r
i
r
r
i
i
[.
r
t.
r.
1.
r
..
GLOSSARY
Ad valorem Tax - a tax levied on the assessed value, net of any exemptions, of real or personal
property. This is commonly referred to as "property tax".
Adopted Budget -The fmancial plan of revenues and expenditures for a fiscal year (October 1 -
September 30) as approved by the City Commission.
Amendment - A change to the adopted budget which may increase or decrease a fund total.
Appropriation - A specific amount of funds authorized by the City Commission to which fmancial
obligations and expenditures may be made.
Assessed Value - A value established by the property appraiser for all real orpersonal property for
use as the base for levying property taxes.
Bond - A written promise to pay a sum of money on a specific date at a specific interest rate as
detailed in a bond ordinance.
Bond Covenants - An agreement between the City and lenders which specifies a payment
schedule, terms, security, pledges, use of funds and reserves to be held.
Budget Calendar-The schedule ofkey dates for the process ofadopting and executing an adopted
budget.
Budget Document -The official written statement of the annual fiscal year financial plan for the
City as presented by the City Manager.
Budget Hearing -The public hearing conducted by the City Commissioners to consider and adopt
the annual budget.
Budget Message - A brief written statement presented by the City Manager to explain the principal
budget issues and to provide policy recommendations to the City Commissioners.
Capital Improvement Plan -A plan for capital expenditures to be incurred each yeaz over a fixed
number of years. The plan sets forth each capital project and identifies the expected beginning and
ending yeaz for each project and the amount to be expended in each yeaz and a method of funding
for those projects.
Capital Needs -The identification of public facilities needed within the community.
171
Capital Outlay -Expenditures that result in the addition of a capital asset (fixed asset costing
$1,000 or more with useful life of greater than one year).
Capital Projects -The acquisition, construction or improvement of designated fixed assets such
as land and buildings.
Cash Reserves -Moneys either restricted or designated which are set aside in a fund and which
are appropriated to ensure sufficient cash is available for the following fiscal yeaz.
City Commissioner -The governing body of the City of Atlantic Beach composed of five elected
officials. The duties and responsibilities ofthe Commission are established by Florida Statutes and
the City's Code of Ordinances.
City Manager -The chief administrative officer of the City appointed by the City Commission.
Contingency - A budgetary reserve to provide for emergency or unanticipated expenditures during
the fiscal yeaz.
Contracting Out -Legal agreement whereby the City pays a private business or individual to
provide the public with a service or product.
Credit Ratings - An independent rating service's evaluation of the credit worthiness of notes and
bonds. Ratings influence the cost of borrowing funds.
Debt -Funds owed as a result of borrowing.
Debt Service -The expense of retiring such debt as loans and bond issues. It includes principal
and interest payments, and payment for the paying agents, registrazs and escrow agents.
Debt Service Reserve -Moneys set aside to ensure that funds will be available in the event that
pledged revenues fall short of expectations.
Deficit -The excess of expenditures over revenues during a fiscal yeaz.
Department - A basic organizational unit of the City which is functionally unique in its service
delivery.
Depreciation -The periodic expiration of an asset's useful life. Depreciation is a requirement in
the proprietary fund types including the Enterprise and Internal Service Funds.
Encumbrance -The commitment of appropriated funds to purchase an item or service.
Enterprise Fund - A governmental accounting fund in which the services provided are financed
and operated similazly to those of a private business enterprise, i.e., to be self supporting through
172
l
• user chazges or other fees.
l Expenditure -Decrease in fund financial resources for the procurement of assets or the cost of
goods and / or services received.
Final Millage -The tax rate adopted in the final public hearing of a taxing authority.
(' Fiscal Year -The annual budget yeaz for the City which runs from October 1 through September
30. The abbreviation to designate fiscal year is "FY".
I Franchise Agreement - Agreement beriveen the City and a provider of public services, such as
cable television or gazbage collection, which imparts certain standazds on the company and provides
for the payment of franchise fees to the City.
Fund - A fiscal and accounting entity with a self balancing set of accounts recording cash and other
financial resources, together with all related liabilities and residual equities or balances, and changes
therein, which are segregated for the purpose of carrying on specific activities or attaining certain
objectives in accordance with special regulations, restrictions, or limitations.
Fund Balance -The excess of fund assets over fund liabilities. These unspent funds can be
included as revenues in the following year's budget. A negative fund balance is sometimes referred
(' to as a deficit.
General Fund -The governmental accounting fund supported by ad valorem property taxes,
licenses and pennits, service charges, and other general revenues to provide city-wide operating
services. This maybe referred to as the Operating Fund.
,General Obligation Bond - A bond secured by the pledge of the issuing jurisdiction's full faith,
credit and taxing authority and is voter approved.
Grant - A contribution of assets (usually cash) by one governmental unit or other organization to
another made for a specific purpose.
Impact Fee -Monetary payments made by builders or developers to defray the public cost of
providing infrastructure capital to a development.
Infrastructure -Public support structures such as roads, street lighting, water and sewer lines and
storm drainage.
Intergovernmental Revenue -Revenue received from another governmental unit for a specific
r purpose.
1
r Levy - To impose taxes, special assessments, or service chazges. Another teen for a millage rate.
1
r
I
173
License or Permit Fee - A charge for specific items as required or approved by local and state
regulations for example, building permits and mobile home licenses. -
Line -Item Budget - A budget that lists each account category sepazately a]ong with the dollaz
amount budgeted for each account, such as office supplies, overtime or buildings.
Long Term Debt. -Debt with the maturity date being more than one yeaz after issuance. -
Mandate -Any responsibility, action or procedure that is imposed by one government entity on
another through constitutional, legislative, administrative, executive or judicial action as adirect -'
order or that is required as a condition of aid.
Matching Requirement - A jurisdictions contribution to a project or function required by a
funder's sources as a basis for the funder's contribution. Matching requirements are frequently
imposed as a proportionate share of the overall contribution.
Mill or Millage Rate - (1 / 1,000) of one dollaz, used in computing taxes by multiplying the rate
times the taxable value divided by 1,000. Example: millage rate of3.71 per thousand; taxable value -
of $50,000 = $50,000 divided by 1,000 = $50 multiplied by 3.71 =185.5.
Non-Departmental Expenditures -Expenditures which benefit all or a portion of City -
departments, such as property and liability insurance.
Object Code - An account to which an expenditure or expense is recorded in order to accumulate
and categorize the vazious types of payments that are made by governments. Certain object codes
are mandated by the Uniform Accounting System chart of accounts.
Operating Expenditures -Also known as Operating and Maintenance Costs, these are the
expenses of the day to day operations which exclude capital costs, such as office supplies,
maintenance of equipment and utilities.
Personal Services -Also known as Salary ,Wages and Benefits related to the compensation of -
employees.
Privatization -The government policy of allowing or contracting with the private sector for the -
provision of public services.
Property Taz - Same as definition for ad valorem tax.
Proposed Millage -The tax rate certified to the property appraiser by each taxing authority.
Real Property -Land and the buildings and other structures attached to it that are taxable under
state law. _
174 `
.-
.. .
Reserve - An account used to indicate that a portion of a fund's balance is restricted for a specific
,. purpose and is therefore, not available for general appropriation.
Revenue - Funds that a govemment receives as income. These receipts may include tax payments,
interest earnings, service chazges, grants and intergovernmental receipts.
1 Revenue Bonds -Bonds usually sold for the construction of a capital project that will produce
l revenue for the governmental unit issuing the bonds. The revenue is pledged and used for the
l payment of principal and interest on the bonds.
Special Assessment - A compulsory levy imposed on certain properties to defray part or all of the
costs of a specific improvement or service deemed to primarily benefit those properties.
Tax Base -The total property valuation on which each taxing authority levies it's tax rates.
Tax roll -The certificate of assessed taxable value prepazed by the property appraiser and presented
to the taxing authority by July 1, or later if an extension is granted by the State, each yeaz.
r- Tax Year - The calendaz year in which ad valorem property taxes are levied to finance the ending
fiscal yeaz budget. For example, the tax roll for the 1998 calendaz yeaz would be used to calculate
I,,, the ad valorem taxes levied for the FY 1998-99 budget.
` ' Tentative Millage -The tax rate adopted in the first public hearing of a taxing authority. Under
state law, the authority may reduce, but not increase without individual notification, the tentative
~ millage during the final budget heazing.
^ Truth In Millage Law -also known as the TRIM Bill. A 1980 law enacted by the Florida
.Legislature which changed the budget process for local taxing authorities. It was designed to keep
the public informed about the taxing intentions of the various authorities.
~ Uniform Accounting System -The chart of accounts prescribed by the Office of the State
Comptroller designed to standazdize financial information to facilitate comparisons and evaluation
of reports.
.. User Fees -The chazges for direct receipt of public services.
' Unencumbered Balance -The amount of an appropriation that is neither expended nor
encumbered. It is essentially the amount of funds still available for future needs.
Voted Millage -Property tax levies authorized by voters within a taxing authority. Bond issues
that are backed by property taxes are a common reason for a voted millage in the State of Florida.
A bond issue of this type is called a General Obligation Bond.
I.-
l.
..
175
176