The following glossary provides a brief explanation of terms and acronyms used throughout the
Budget document. This information is provided to assist the public in reviewing and understanding
the Budget by defining the many technical terms, abbreviations, and acronyms used in presenting
A record of a monetary transaction maintained in the accounting ledger. It may be a classification
of expenditure or revenue. Example: "Supplies" is an account in the Operations and Maintenance
ACCRUAL BASIS OF ACCOUNTING
The basis of accounting under which revenues are recorded when earned and expenditures (or
expenses) are recorded as soon as they result in liabilities (obligation to pay) for goods and/or
services received. The actual receipt (for revenues) or payment (for expenditures) of cash is not the
determining factor when deciding on the proper accounting period for recording revenues and
expenditures under the accrual basis of accounting.
A column heading in the budget. Figures found in the Actual column indicate actual financial
information recorded for that time period.
AMERICANS WITH DISABILITIES ACT (ADA)
Americans with Disabilities Act, Public Law 336 of the 101st Congress, enacted July 26, 1990. The
ADA prohibits discrimination and ensures equal opportunity for persons with disabilities in
employment, State and local government services, public accommodations, commercial facilities,
and transportation. It also mandates the establishment of TDD/telephone relay services.
The budget document formally approved by the City Council after the required public hearing and
deliberations on the City Manager's Budget. It sets forth authorized expenditures and the means of
financing those expenditures for a given fiscal year. This term is used interchangeably with the
term "Final Budget."
AD VALOREM TAXES
Revenue from taxes paid on real property and personal property which is calculated based on the
“value” of the property.
The legal spending level authorized by an ordinance, resolution, or minute action of the City
Council. Spending cannot legally exceed this level without approval by the Council. An
appropriation expires at the end of the fiscal year.
A valuation set upon real estate or other property by the County Assessor or State Board of
Equalization which serves as a basis for levying property taxes.
The official list prepared by the County Assessor which contains the legal description of each parcel
or item of property and its assessed valuation. This term is used to denote the total valuation of all
taxable property in the City.
An examination of the City's financial records by an independent, certified public accounting firm
to determine the accuracy and validity of records and reports, and the conformity of procedures with
established policy and GAAP.
A balanced budget requires that the amount of budgeted expenditures be equal to or less than the
amount of projected revenues for the budget year.
BASIS OF ACCOUNTING
A term used to refer to when revenues, expenditures (expenses), and transfers – and the related
assets and liabilities – are recognized in the accounts and reported in the financial statements. The
City of Turlock uses the accrual basis of accounting. See Accrual Basis.
The beginning balance of a fund is comprised of unspent funds brought forward from the previous
fiscal year, i.e. the ending balance for the fiscal year just ended.
A process whereby a public agency awards contracts for construction or construction-related work
objectively, based on bids. Bids are offers to perform the work for a specific price, with the
contract going to the lowest responsive bidder. See Responsive Bidder.
A written promise to pay a sum of money on a specific date at a specified interest rate. The interest
payments and the repayment of the principal are detailed in a bond agreement. Bonds are most
frequently used for construction of large capital projects, such as buildings and streets. Also, the
term bond is used to describe a performance bond whereby an independent, third party financially
guarantees the actions or performance of another.
The planning and controlling document for financial operations which sets forth estimates of
proposed expenditures and revenues for the fiscal year. Also, when used as a column heading, the
approved level of funding for that time period.
The schedule of key dates that the City's departments follow in the preparation, adoption and
administration of the budget.
The opening section of the budget that provides the City Council and the public with a general
summary of the most important aspects of the budget, changes from the current and previous fiscal
years, and the views and recommendations of the City Manager.
The official enactment by the City Council to establish legal authority for City officials to obligate
and expend resources.
The level of control or management of a governmental unit or enterprise in accordance with an
approved budget for the purpose of keeping expenditures within the appropriations limit and
available revenues. The City of Turlock budgetary control begins at the department level.
Departments can reallocate spending within an Object (i.e. Supplies or Utilities) with the exception
of Personnel and Capital Outlay. The total expenditures for that Object cannot be increased without
the approval of the City Manager or City Council. Any reallocations between Objects must be
approved by the City Manager. Only the City Council can approve increases in the total
appropriation for a Department.
The budgeting basis for the City of Turlock is modified from the accrual basis in that depreciation
expense is not shown in the budget, capital expenditures are shown as a use of resources (rather
than an asset), and principal payments on debt are shown as a use of resources (rather than a
reduction in a liability).
CAPITAL IMPROVEMENT PROGRAM (CIP)
A plan for funding additions, improvements and/or replacements to capital assets to be incurred
over a fixed period of time.
Expenditures available for the acquisition of tangible items which are anticipated to have a useful
life of longer than one year, including the cost of land, buildings, permanent improvements,
machinery, large tools, vehicles and large pieces of equipment.
A new structure or facility or a major improvement to an existing structure or facility, which
significantly increases the value of a structure or facility.
An account used to indicate that a portion of a fund's balance is legally restricted for a specific
capital purpose and is, therefore, not available for discretionary appropriation.
CASH BASIS OF ACCOUNTING
The basis of accounting under which revenues are recorded when received in cash and expenditures
(or expenses) are recorded when cash is disbursed. To be in conformance with Generally Accepted
Accounting Principles (GAAP), local governments must use an accrual basis rather than the cash
basis of accounting when preparing their financial statements.
The process necessary to pay for governmental services, while investing temporary cash excesses in
order to earn interest revenue. Cash management refers to the activities of forecasting the inflows
and outflows of cash, mobilizing cash to improve its availability for investment, and establishing
and maintaining banking relationships.
CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA)
California Environmental Quality Act – statutes contained in Sections 21000-21177 of the Public
Resources Code of the State of California – establishes the requirements for evaluating the
environmental effects of proposed projects. The administration of CEQA is governed by the State
COMMUNITY FACILITIES DISTRICT (CFD)
Commonly referred to as a Mello-Roos District, a CFD is a district with a special tax on real
property to pay for capital projects and/or public services. The term “Mello-Roos” comes from the
two state legislators who authored the implementing law.
COMMUNITY DEVELOPMENT BLOCK GRANT (CDBG)
Funding from the U. S. Department of Housing and Urban Development (HUD) whose use is
restricted for prescribed purposes primarily to assist in the preservation and production of affordable
housing. CDBG law specifies what types of programs can be funded with this revenue source,
which is accounted for in a restricted fund.
A budgetary reserve set aside for emergencies or unforeseen expenditures not otherwise budgeted.
The City's obligation to make principal and interest payments on all bonds, leases, and other debt
instruments according to a pre-determined payment schedule.
An organizational unit used by the City to group services, programs, or functions which are usually
similar in nature. Each department is managed by an appointed department head.
An official appointed by the City Manager who is responsible for managing a City department.
The total of discretionary revenues (defined below) plus the unreserved General Fund Ending Fund
balance from the preceding fiscal year. The City Council has discretion in deciding how these
funds are used.
Revenues received by the City which can be used for any legal purpose as determined by the City
Council. Discretionary revenues are not earmarked by law or contractual relationship for a
specified purpose, and the Council has discretion in deciding how these revenues are used. The
term "discretionary" does not imply surplus.
ENVIRONMENTAL IMPACT REPORT (EIR)
An Environmental Impact Report is a detailed statement prepared under CEQA guidelines
describing and analyzing the significant effects of a project on the environment (as defined by
CEQA) and discussing ways to lessen or avoid the effects. The contents of an EIR are discussed in
Article 9, beginning with Section 15120 of the State CEQA Guidelines.
Amounts paid on behalf of employees. These amounts are not part of the employee's gross salary.
Examples are group health or life insurance payments, contributions to employee retirement plans,
Social Security and/or Medicare taxes, workers' compensation insurance payments, and
unemployment insurance payments.
The commitment of appropriated funds to purchase an item or service. To encumber funds is to set
aside or commit funds for future expenditures.
A fund established to finance and account for the operation and maintenance of operations, facilities
and services which are intended to be supported by user charges. Municipal services such as water,
wastewater (sewer), and refuse collection are examples of services that are often accounted for in
separate Enterprise funds.
EDUCATIONAL REVENUE AUGMENTATION FUND (ERAF)
Educational Revenue Augmentation Fund was set up by the State to take local property tax
revenues for redistribution to the school system. Proposition 98 guaranteed schools 60% of the
State's General Fund revenues. By creating ERAF, the State took local property taxes from cities,
counties and special districts and used them to pay part of the cost of school funding.
Payment of funds appropriated by the City Council, resulting in a decrease in current assets (cash).
Charges for services levied by the government to recover costs associated with providing a service
or permitting an activity. Examples of fees include monthly water, sewer and garbage collection
fees, Plan Checking Fees, Building & Engineering Permitting Fees, and Franchise Fees.
The budget document formally approved by the City Council after the required public hearings and
deliberation on the recommended budget. It is a legal spending plan for the fiscal year. This term is
used interchangeably with the term "Adopted Budget."
Abbreviated as FY (or FYE for fiscal year end), the twelve-month period for which a budget is
prepared and adopted. The fiscal year for the City of Turlock is July 1 to June 30.
Tangible items of long-term character (useful life expected to be longer than one year) which are
intended to continue to be held and used by the City, including land, buildings, machinery,
furniture, equipment, and equipment.
A fee charged for the privilege of using public rights-of-way and property within the City for public
or private purposes. The City charges franchise fees for natural gas, electricity, cable television and
garbage collection operations.
FULL-TIME EQUIVALENT POSITIONS (FTE)
The number of regular positions to be funded in the budget. Full-time is typically defined as a
position which is budgeted 40 hours a week or 2,080 hours a year.
A separate fiscal and accounting entity that is established to control and account for all financial
transactions for a specific type or grouping of government activities. A fund is a separate set of
self-balancing accounts comprised of the assets, liabilities, equity, revenues and expenditures
(expenses) for the specified activity.
Fund balances, beginning and ending, are established to show the amount of assets in excess of the
liabilities for a fiscal year. The ending fund balance for a completed fiscal year becomes the
beginning fund balance for the next fiscal year.
FUND BALANCE APPROPRIATED
This is a budgetary amount representing the amount of fund balance to be used, in conjunction with
revenues, to offset expenditures during a fiscal year. Fund balance appropriated cannot exceed the
sum of unencumbered cash and investments available in the fund.
GENERALLY ACCEPTED ACCOUNTING PRINCIPLES (GAAP)
Generally Accepted Accounting Principles are the set of uniform, minimum professional standards
and guidelines for financial accounting and reporting. GAAP encompasses the conventions, rules
and procedures necessary to define generally accepted accounting practices. The City prepares its
financial statements in accordance with GAAP accepted in the United States of America.
An absolute dollar limit on the amount of funds derived from taxes that the City can legally
appropriate and expend each fiscal year, as specified by Article 13-B of the State Constitution. Any
tax revenues in excess of the Gann Limit must be returned to taxpayers. The base-year used on
computing the Gann Limit is FY 1978-79, with adjustments to the appropriations limit allowed in
succeeding fiscal years for changes in population and changes in the cost of living.
GOVERNMENTAL ACCOUNTING STANDARDS BOARD (GASB)
Governmental Accounting Standards Board is the accounting profession's regulatory body for
governmental accounting and determines what constitutes GAAP for governmental agencies.
The General Fund is where discretionary revenues are deposited to fund the programs and
departments established to achieve the goals and objectives of the City Council. The General Fund
represents the largest discretionary financial resource of the City of Turlock.
The general ledger is the system and structure of accounts that record the financial transactions and
report the financial position of the city of Turlock. The general ledger is automated and meets
The comprehensive plan, required by Section 65300 of the Government Code of the State of
California, that contains the goals, objectives, policies, and specific actions that guide the long-term
land development and growth of the City of Turlock.
GEOGRAPHIC INFORMATION SYSTEM (GIS)
Geographic Information System is a computerized rendering of the physical layout of the City of
Turlock. It is a dimensionally exact, multi-layered map displaying all of the public services and
physical characteristics of every parcel of real property in the city. It is an invaluable tool for public
works and public safety personnel.
A financial contribution from one governmental unit or private entity to another for a specific
purpose and/or time period. Most of the grants received by the City of Turlock are from the State
and federal governments.
Public facilities built on or under the ground such as streets, roads, sidewalks, curbs, pipes, drains,
lights, bridges, parks, and water and sewer systems. These types of capital assets are differentiated
Amounts transferred from one fund to another. Interfund transfers must be approved by the City
Council and are a normal means to record the cost of goods and services provided by one fund to
another. The City of Turlock also uses interfund transfers when a capital project is being funded
from multiple sources. The project expenditures are accounted for in one fund and with the
contributing funds transferring their financial contribution to the project fund.
Revenue earned by investing the City's idle cash reserves. The City of Turlock invests its funds in
accordance with the California Government Code. Investment earnings are deposited and used for
fund specific purposes.
The Investment Policy is a written, Council-adopted policy delineating permitted investments for
the City's idle cash. The City of Turlock's Investment Policy is updated and reaffirmed regularly.
Assignment of a position title and job description with an associated pay range based on the job
skills required for the position.
A requirement by the State or federal government that the City perform a task, perform a task in a
particular way, or perform a task to meet a particular standard, often without compensation from the
higher level of government.
MEMORANDUM OF UNDERSTANDING (MOU)
Memorandum of Understanding is a formalized agreement of processes, results, and/or operating
rules between two or more entities. The City typically uses MOU's in the collective bargaining
process with its employee groups.
MODIFIED ACCRUAL BASIS OF ACCOUNTING
Under the modified accrual basis of accounting, revenues are recognized in the period in which they
become available and measurable, and expenditures are recognized at the time a liability is incurred
pursuant to appropriation authority.
These are all funds other than the General Fund. Non-General Fund fund types include Special
Revenue, Capital Project, Enterprise, Internal Service and Trust/Agency Funds.
The portion of the budget pertaining to the daily operations that provides basic governmental
A formal legislative enactment by the City Council. It has the full force and effect of law within the
City boundaries unless it is in conflict with any higher form of law, such as a State statute or
Taxes other than property tax. This category includes local sales tax, business license tax, transient
occupancy tax (hotel & motel tax), and Vehicle in Lieu (VLF) tax.
A quantitative indicator that programs or services are directly contributing to the achievement of a
strategic plan. This includes indicators of inputs, output, outcomes, productivity, timeliness, and/or
CALIFORNIA PUBLIC EMPLOYEES RETIREMENT SYSTEM (PERS OR CalPERS)
The California Public Employees Retirement System provides retirement benefits through a defined
pension plan for State and many local government employees in California. Local agencies like the
City of Turlock choose to contract with CalPERS for public pension management.
A general expenditure category that includes salaries and wages, as well as related employee
benefits such as retirement, health (medical, dental and vision) insurance, workers' compensation
insurance and life insurance.
The budget submitted by the City Manager to the City Council and the public. It contains the
proposed revenues and expenditures by Fund for the upcoming budget year(s). The Preliminary
Budget has typically been prepared by the Department Directors and reviewed with the City
Manager and Finance Staff. Depending on the direction provided by the City Council, the
Preliminary Budget may have also been reviewed with a Council Budget Subcommittee prior to
being presented to the entire City Council.
PROCEEDS OF TAXES
Revenue received from "tax" sources, such as property taxes, sales and use taxes, and other types of
taxes. Proceeds of taxes are subject to the Gann Limit.
The amount of revenue that is expected to be collected during a fiscal year.
An “ad valorem” tax on real property, based upon the value of the property. In accordance with
Proposition 13, secured property is taxed at the rate of one percent of assessed valuation, plus a rate
sufficient to generate revenue necessary to pay for voter approved indebtedness.
The City Manager's recommendation for the City's financial operations, which includes an estimate
of proposed expenditures and revenues for a given fiscal year.
The State-wide ballot initiative measure approved by the voters in November, 1979, which
established the Gann Appropriations Limit through amendment of the State Constitution (Article
13-B of the State Constitution). See Gann Limit.
A State-wide ballot initiative measure (known as the Jarvis/Gann Initiative) enacted by the voters in
June, 1978, which amended the State Constitution to limit property taxes to 1% of the 1975-76
market value, and which limited annual increases in assessed valuation to 2% (except for new
construction or property which changes ownership).
Change in a position title and/or the associated pay range based on changes in the job skills required
for a given position.
The Recommended Budget document is provided by the City Manager's Office and serves as the
basis for public hearings prior to the determination of the adopted budget.
Funds not appropriated for expenditure, which are legally segregated for a specific future use.
A bid or proposal which substantially complies with the invitation to bid or request for proposals,
and meets all prescribed public procurement procedures and requirements.
Funds received by the City as income, including sales and property taxes, licenses and permits, fees
for specific services, receipts/reimbursements from other governmental entities, fines and
forfeitures, grants, and investment income.
Bonds for the construction of capital projects, the principal and interest of which are payable
exclusively from the revenue of an Enterprise Fund. A lien is placed on the project funded by the
bonds until they are fully paid.
The major categories of General Fund revenues are property taxes, other taxes, franchise fees and
assessments, fines and penalties, investment income, rents and concessions, and intrafund transfers.
Other revenues specific to General Fund departments are listed by department. Other revenues
related to non General Fund activities are described in their respective sections of the budget.
REQUEST FOR PROPOSALS (RFP)
Request for Proposals, similar to a bid but used when the desired product or service is not fully
quantifiable, such as “Audit Services”.
REQUEST FOR QUALIFICATIONS (RFQ)
Request for Qualifications is a process whereby professional services are solicited, where the
products or services needed require substantial assistance to define. The qualifications and
experience of the solicited professional are important qualifying characteristics.
SALES AND USE TAX
A tax imposed on the sale or use of all tangible personal property. Sales and use taxes have several
components. The City's share of the sales and use tax is 95% of the local 1%. The remaining 5% is
shared with Stanislaus County pursuant to a tax sharing agreement.
An audit performed in accordance with the Single Audit Act of 1984, as amended in 1996, and
United States Office of Management and Budget (OMB) Circular A-133, Audits of State and Local
Governments. The Single Audit Act requires governments that incur expenses in excess of a
specified amount for federally funded projects/programs in one fiscal year have one audit (i.e.
Single Audit) performed to meet the needs of all Federal grantor agencies, thus reducing the overall
costs of audits. This audit seeks to determine whether the recipient agency is in compliance with all
internal control and other program guidelines which are conditions for receiving federal funding.
SPECIAL REVENUE FUND
A fund which is used to account for revenues which are designated by law for a specific purpose.
Payments by an outside agency (usually a State or federal agency) for reimbursement of costs
incurred by the City.
An assessment of real property occurring after the regular assessment roll is filed on June 30th of
each year as a result of new construction or a change in ownership.
Tax increment is the funding mechanism for Redevelopment Agencies in California. When
Agencies provide or assist in providing financial assistance to improve blighted areas of a city, the
associated assessed value of the improved real property increases. This “incremental” increase in
assessed value results in an increase in property tax revenue which is known as “tax increment”.
Tax increment revenue must remain in the Redevelopment Agency to be used for repaying any debt
incurred by the Agency and for additional approved projects. The use of tax increment revenue by
Redevelopment Agencies is governed by the California Health and Safety Code.
See “Revenue Projections and Assumptions” section for a discussion regarding the dissolution of
redevelopment agencies within California effective February 1, 2012.
TRANSIENT OCCUPANCY TAX (TOT)
A tax that is imposed on occupants of hotel/motel rooms who are staying 30 consecutive days or
less at a time. The City of Turlock TOT rate is 9% of the room rate.
Triple Flip is the term for a State finance plan that went into effect on July 1, 2004 with a ten year
duration. It consists of 1) a reduction of the Local Sales and Use Tax Rate by ¼ % in tandem with a
new ¼ % State rate to fund a fiscal recovery bond, 2) repayment to cities and counties with
additional local property tax previously allocated to local schools, and 3) repayment to local schools
from the State general fund.
A tax on tangible personal property such as office furniture, equipment, and boats which are not
secured by real property.
This term means as of June 30th (the end of the fiscal year).