REVENUE MANUAL

An Evaluation Of Major Revenues

Revenue forecasting is important to ensure that the Town has the resources to meet its operational and infrastructure needs in the coming years. Looking only at revenue received from outside sources, the two charts on the following page show how sales and use tax revenues make up 73.5% of the total General Fund revenues and 42.0% of total Town revenues.

Due to its reliance on this primary revenue source, the Town implemented a forecasting model to help identify future financial impacts to Town strategies. The forecast model maintains monthly historical revenues back to 2016 and includes the budget for the next fiscal year for each account by fund, which allows for quick identification of changes in historical trends. Various growth rates, rolling twelve-month averages and annualized amounts are also included for budget development.

In 2021, the model was expanded to include a ten-year forecast for each revenue account to assist with long range planning. The forecasted amounts reflect potential economic impacts and the impact of planned Town activities and growth in addition to the historical financial trends.

In order to provide flexibility in the budget for unexpected events, revenue is budgeted conservatively.

In 2019, the forecast model highlighted future revenue trends that prompted the Town to engage an outside consultant to analyze user fees and the level of infrastructure cost recovery related to growth and development. Resulting changes to fee structures positively impacted revenue beginning in 2020.