The City is required to hold two public hearings for adoption of a property tax rate and budget. The first public hearing is advertised by the Property Appraiser mailing to each property owner a TRIM notice. The City Commission must adopt the operating budget and capital improvement budget and program by separate ordinances before the end of each current fiscal year for the ensuing fiscal year. Governmental funds use the modified accrual basis of accounting, whereby expenditures are recognized in the accounting period when the liability is incurred, if measurable, and revenues and other resources are recognized in the accounting period when they become available and measurable. Revenues are considered to meet the availability test if they are collectible within the current period or soon enough thereafter for use in payment of liabilities of the current period.
Proprietary funds use the full accrual basis of accounting.
Revenues are recognized in the period in which they are earned, and expenses are recognized in the period in which the liabilities are incurred. The annual budget addresses only the Governmental and Proprietary groups and does not control resources that are managed in a trustee or fiduciary capacity. All appropriations unspent at year-end lapse unless funds are encumbered as the result of the issuance of a purchase order. Such purchase orders remain valid until either canceled or final payment is made. The City of Clearwater uses funds to budget for operations and to account for the results of those operations.