HomeMy WebLinkAboutItem 06 - DFW Airport RevenueMEMOTO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: BRUNO RUMBELOW, CITY MANAGER
MEETING DATE: APRIL 21, 2020
SUBJECT: APPROVAL OF AN ORDINANCE APPROPRIATING FUNDS FOR
REQUIRED PAYMENTS ASSOCIATED WITH DFW AIRPORT REVENUE
SHARING AGREEMENT IN ACCORDANCE WITH SENATE BILL 569
RECOMMENDATION: City Council to consider the approval of an ordinance appropriating funds
for payments to the City of Dallas and the City of Fort Worth in
accordance with Senate Bill 569 Revenue Sharing Agreement.
FUNDING SOURCE: Upon approval of the attached ordinance, funding in the amount of
$1,209,175 will be available in the General Fund.
BACKGROUND: In September of 2001, the Texas Legislature enacted S.B. 569 mandating
a revenue sharing plan for the City of Grapevine and DFW Airport.The
agreement requires the City to share certain revenues generated within
the boundaries of the Dallas/Fort Worth International Airport with
constituent agencies including the City of Dallas and the City of Fort
Worth.
When the bill was created, the State Research Center's bill analysis
concluded that the City of Grapevine received approximately $11 million in
taxes generated at the airport. The enacted version of S.B 569 set the
base year at $5,941,780, as it excluded the I&S portion of the property tax
as well as Hotel Occupancy Tax revenue.
The amount mandated to be paid is 2/3 of the excess of the base year
amount of $5,941,780 established in Fiscal Year 2000. Fiscal Year 2019
shared revenues were $7,758,043 exceeding base year revenue by
$1,816,263. The cost of the required audit of the results was $2,500 which
reduces the amount of revenue to be shared to $1,813,763. The shared
amounts to be paid to the Cities of Dallas and Fort Worth are $769,475
and $439,700 respectively which represents 2/3 of the total shared
revenue.
The FY20 Adopted Budget included $800,000 for this purpose. However,
the total payments of $1,209,175 exceeded the adopted budget by
$409,175 necessitating the attached appropriation ordinance.
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Independent Accountant's Report
on Applying Agreed -Upon Procedures
To the Honorable Mayorand
Membersof City Council
City of Grapevine, Texas
We have performed the proced uresenumerated below, which were agreed to by the City of Grapevine,
Texas(the City), solely to assist in evaluating management's compliance with the proceduresdefined by
the State of Texas Transportation Code, Sec. 22.089, Airport Revenue of Nonconstituent Municipalities
(the Code) for the year ended September 30, 2019. Management of the city is responsible for its
compliance with the Code. -The sufficiency of these procedures issolely the responsibility of those parties
specified in this report. Consequently, we make no representation regarding the sufficiency of the
procedures described below either for the purpose far which this report has been requested or for any
other purpose.
The proceduresthat we performed and related find ingsare asfollows:
1. We verified the mathematical accuracy of the City of Grapevine'sexcess revenue calculation as
defined by the State of Texas Transportation Code, Section 22.089, by agreeing information in the
calculation to supporting documentation forthe yearended September30, 2019.
2. We recalculated the amount of increased revenues in excess of base year revenues to be
allocated to the City and Dallas and Fort Worth. our calculations indicated no difference in the
total amountsto be allocated.
This agreed-upon procedures engagement was conducted in accordance with attestation standards
established by the American Institute of Certified Public Accountants. We were not engaged to, and did
not conduct an examination or review, the objective of which would be the expression of opinion or
conclusion, respectively, on the specified elements of revenue. Accordingly, we do not express such an
opinion or conclusion.
Had we performed additional procedures, other matters might have come to our attention that would
have been reported to you.
7hisreport isintended solely forthe information and use of the specified partiesand isnot intended to be
and should not be used by anyone otherthan these specified parties.
W EA V ER A N D TI D VII ELL, L.L.P.
Dallas, Texas
March 18, 2020
Weaverand Tidwell, LL.P.
2300 No rth Fe Id Stre et, Si ite 1000 1 Da Ila s, Texa s 75201
Main: 972.490.1970 1 Fax: 972.702.8321
CPAs AND ADVISORS j WEAVERCOM
Dallas Fort Worth Revenue Share Calculation
FY 2019
FY 2000
Amount
Increase Year
Amount Actual
FY 2017 Actual
FY 2018 Actual
Proposed
over Year
( tax year 1999)
tax year 2016
Tax Year 2017
Tax Year 2018
Property Tax Non -Franchise
21903,440
111871206
11531,382
11618,776
Property Tax On Franchise
55,570
56,134
67,034
66,011
Total Property Tax
2,959,010
1,243,340
1,598,415
1,684,787
86,372
Franchise Revenue
450,839
1,394,438
1,414,629
1,400,243
(14,p386)
Sales Tax- Non List Filers
11596,744
31294,701
31357,959
31667,829
Sales Tax - List Filers
2811740
-
-
-
Sales Tax - Utilities
64,590
81079
91561
51917
Total Sales Tax
1,943,073
3,302,779
3,367,520
3,673,746
306,226
Mixed Beverage Revenue
243,848
650,577
697,436
856,119
158,683
Court Revenue
345,011
115,808
132,021
143,148
11,127
Total Revenue
5,941,780
6,706,942
7,210,021
7,758,043
548,022
Calculation of Revenue Share
Excess Over base Year
765,162
1,268,241
1,816,263
548,022
Grapevine % (1/3 of total)
255,054
422,747
605,421
182,674
Dallas % (7/11 of 2/3 of Total)
324,429
538,042
770,536
232,494
Fort Worth % (4/11 of 2/3 of Total) 185,679 307,452 440,306 132,854
Total Revenue Share 765,162 1,268,241 1,816,263 548,022
Total Paid to Dallas/Fort Worth
510,108 845,494
1,210,842 365,348
Calculation of Share of Audit Expense
Grapevine % (1/3 of total) 833
Dallas % (7/11 of 2/3 of Total) 1,061
Fort Worth % (4/11 of 2/3 of Total) 606
Total Audit Cost 2,500
FINAL REVENUE SHARE CALCULATION
Grapevine % (1/3 of total) 604,588
Dallas % (7/11 of 2/3 of Total) 769,475
Fort Worth % (4/11 of 2/3 of Total) 439,700
I TOTAL PAID TO DALLAS/FORTH WORTH 1,209,175
ORDINANCE NO. 2020-018
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
GRAPEVINE, TEXAS, REVISING THE ADOPTED BUDGET
FOR THE FISCAL YEAR ENDING IN 2020; PROVIDING
FOR THE TRANSFER OF THE FUNDS, DECLARING AN
EMERGENCY AND PROVIDING AN EFFECTIVE DATE
WHEREAS, the City Council of the City of Grapevine entered into a DFW Revenue
Sharing Agreement with the DFW Airport and the Cities of Dallas and Fort Worth, Texas
per Senate Bill 569; and
WHEREAS, the agreement indicates that revenues within the Dallas Fort Worth
International Airport are to be shared if they exceed amounts in fiscal year 2000 base
year of $5,941,780. The amount will be split 7/11 to Dallas and 4/11 to Fort Worth, net
of accountant's fees; and
WHEREAS, the funding for payments associated with the DFW Revenue Sharing
Agreement shall be appropriated from General Fund Balance in the amount of $409,175;
representing the excess amount over the 2020 Operating Budget; and
WHEREAS, the funding for the Sharing Agreement should be paid from the
General Fund; and
WHEREAS, all constitutional and statutory prerequisites for the approval of this
ordinance have been met, including but not limited to the Open Meetings Act; and
WHEREAS, the City Council deems the adoption of this ordinance to be in the best
interests of the health, safety, and welfare of the public.
NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY
OF GRAPEVINE, TEXAS:
Section 1. That all matters stated hereinabove are found to be true and correct
and are incorporated herein by reference as if copied in their entirety.
Section 2. That the City Council hereby authorizes the appropriation of funds
currently in the General Fund Balance to the General Fund in an amount of $409,175.
Section 3. That a copy of the revised Fiscal Year 2019-2020 Operating Budget
document shall be kept on file in the office of the City Secretary and on the City of
Grapevine website.
Section 4. That the terms and provisions of this ordinance shall be deemed to
be severable, and that if the validity of any section, subsection, word, sentence or phrase
shall be held to be invalid, it shall not affect the remaining part of this ordinance.
Section 5. That the fact that the present ordinances and regulations of the City
of Grapevine, Texas are inadequate to properly safeguard the health, safety, morals,
peace and general welfare of the inhabitants of the City of Grapevine, Texas, creates an
emergency for the immediate preservation of the public business, property, health,
safety, and general welfare which requires that this ordinance shall take effect
immediately from and after its passage and it is accordingly so ordained.
PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF
GRAPEVINE, TEXAS on this the 21st day of April, 2020.
APPROVED:
William D. Tate
Mayor
ATTEST:
Tara Brooks
City Secretary
APPROVED AS TO FORM:
City Attorney
Ordinance No. 2020-018 2