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CONSENT ITEM – 7B MEMORANDUM DATE: September 28, 2020 TO: Honorable Mayor and City Councilmembers Dave Perrault, City Administrator FROM: Gayle Bauman, Finance Director SUBJECT: Transfer fund balance from General Fund to Capital Funds Budgeted Amount: Actual Amount: Funding Source: N/A N/A N/A Council Should Consider Motion to transfer $341,000 from the General Fund to the Public Safety Capital Fund and $137,000 from the General Fund to the Capital Improvement (PIR) Fund and authorizing the Finance Director to complete all corresponding budget adjustments. Background In 2014, the Council adopted a revised Fund Balance Policy which directs the Finance Director to bring a request to the City Council to transfer any excess funds over 50% of fund balance in the General Fund to the PIR Fund once the final audit is completed. The intent of the policy is to utilize the funds for one-time, non-operating items. The primary considerations of the policy are 1) to meet the cash flow requirements of the City; 2) to maintain adequate fund balances and net assets in each individual fund of the City; and 3) to provide for emergencies and contingency needs of the City. These goals are accomplished by transferring the funds to any capital fund in need. Discussion The amount available for transfer based on the 2019 audit is $478,000. Staff is proposing to transfer $341,000 to the Public Safety Capital Fund to cover the cost of the land purchase and access road for the future Lake Johanna Fire Station and to transfer the remaining balance of $137,000 to the PIR Fund. Budget Impact Increase in transfers out of the General Fund and transfers in to the Public Safety Capital Fund and PIR Fund.