When residents hear the word “budget,” they often imagine one big account where all tax dollars are deposited and spent. In reality, the City of Southlake manages more than 50 separate funds, each with its own rules and purpose. This structure, known as “fund accounting,” ensures transparency, compliance with state law, and responsible use of taxpayer dollars.
What is Fund Accounting?
Fund accounting is the municipal standard for tracking revenues and expenses. Each fund acts like its own bank account, with money dedicated to specific uses. Some funds are flexible, while others are legally restricted to certain purposes.
“The City’s budget is a system of separate ‘buckets,’” said Chief Financial Officer Sharen Jackson. “You can’t take money from a bucket that’s legally restricted—like hotel occupancy tax—and use it for something unrelated—like police salaries. Each fund has a job, and that’s how we protect both compliance and trust.”
The Big Three: General, Special Revenue, and Capital Project Funds
- General Fund – The largest and most flexible fund. Pays for core services like police, fire, street maintenance, library programs, parks operations, and general administration.
- Special Revenue Funds – These have specific purposes established by state law, City ordinance, or voter approval. Examples include the Crime Control & Prevention District (CCPD) Fund, Southlake Parks Development Corporation (SPDC) Fund, and Hotel Occupancy Tax (HOT) Fund. Each of these can only be used for designated projects or services.
- Capital Project Funds – Used for major infrastructure, facilities, and equipment. Funded by a combination of cash transfers (pay-as-you-go) and bond proceeds.
A common public question is why the City can’t simply take money from one area to fund another—like moving HOT revenue into road repairs. The answer lies in the legal and policy restrictions that protect the integrity of each fund. In many cases, voter-approved uses or state law require that money be spent exactly as intended.
Examples in Action
- HOT Fund revenues must be used to promote tourism and fund visitor-related facilities. In FY 2026, it’s helping support holiday season enhancements in Town Square to promote tourism during the holiday season.
- SPDC Fund revenues are dedicated to parks and recreation capital projects, such as autonomous mowers for park maintenance and special park improvement projects to enhance safety and the user experience.
- General Fund dollars cover everyday services like police patrols, fire protection, street maintenance, and library operations.
Transparency and Public Trust
This structure makes it easy for residents, elected officials, and auditors to see exactly how money is being used. “Fund accounting provides a clear line between what we can do and what we must do,” said Chief Financial Officer Jackson.
Learn More
The City’s budget website offers fund-by-fund breakdowns, explaining what each fund is used for, where the money comes from, and how it’s being invested in FY 2026. Visit the City Budget Website to explore and learn more about how Southlake keeps its finances accountable.
