Saturday, May 25, 2024

Dixon: Flower Mound is in great financial shape

Steve Dixon

By Steve Dixon

The Town of Flower Mound is in great financial shape. The Town’s total debt at the end of the 2016 was approximately $146 million dollars. One of my opponents in the race for Mayor wrote in an op-ed that the town is $180 million in debt. This is not correct and he must be including the Riverwalk’s Public Improvement District (PID) bonds in his total. The Town of Flower Mound is not financially obligated for the PID bonds. Much of the debt over the last decade has been related to maintaining and improving the Town’s infrastructure. Many of the infrastructure improvements are paid by utility bill receipts and not property taxes. 50% of the Town’s current debt is scheduled to be paid off in the next 5 years and all of the current Town debt is scheduled to be paid off in 19 years. The useful life of the assets the bonds financed will be used for much longer than 19 years. This debt repayment schedule will be in place regardless of the economy and is a great example of good financial management. I don’t want to grow just to grow and the Town does not approve developments for the purpose of increasing tax revenue to help pay for debt.

Every time the Town issues debt, the bond rating agencies grade the Town’s financial condition so an up to date bond rating can be issued. When I was on Council, the Town received its first ever AAA rating and we’ve held it for the last five (5) years. While one of my opponents criticized the Town for not doing long-term planning, one of the primary bond rating agencies, Fitch, cited the Town’s “conservative budget practices, long-term planning and cost monitoring as helping the town to maintain a strong financial position.” Regarding long-term debt, Fitch states that the Town’s burden will remain in the moderate range based on anticipated overlapping debt compared with the Town’s population and income.

Fitch went on to say that Flower Mound’s long-term liability burden (pension) “contributes only modestly to the Town’s long-term liability burden.” The Town is part of the Texas Municipal Retirement System (TMRS). This is one of, if not the, most popular municipal retirement systems in Texas. Dallas, Fort Worth, Houston and other cities where pension problems have been reported are not a part of TMRS.

No one wants to pay more in taxes and I would love to again lower Flower Mound’s property tax rate. However, I do not recommend depleting the Town’s “piggy bank” of reserve funds to lower the tax rate. The bond rating agencies are aware and very fond of our reserves. This cushion provides wise protection in case there’s an emergency or an unexpected downturn in the economy. If the reserve cushion gets too high, Town Council may at any time use a portion of the reserve funds for a one-time capital expense pay down (like the Town has done in the past).

Flower Mound has worked very hard to achieve our current financial shape. From 2012-2016 I also worked hard along with other members of Town Council to help diversify our tax base and shift the burden off resident’s backs. These efforts have helped increase revenues and make Flower Mound a better place to live.

I am fiscally conservative and I will support Flower Mound staying financially strong. Please support my campaign vote – Steve Dixon for Mayor.

Mark Smith
Mark Smith
Mark Smith is the Digital Editor of The Cross Timbers Gazette.

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