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General Comments: • • It is important to remember that funds can be borrowed within the City from one fund to cover a shortage in a second fund. These interfund borrowings can be used to smooth out the collection of funds or to handle unusually large, unanticipated fund requirements. • Part of this process is to inform Capital Fund Balance Rationale. Fund Balances held by the City are accumulated by the process collecting taxes or fees,or by selling community assets(property or community franchise). As such these funds are held in trust for the community to be used in benefit to the community. Ideally all funds held will have a specific,planned purpose/use,but occasionally funds will be held in anticipation of an undefined use. History(and depreciation schedules) can help define the need for fund balances to replace broken or lost city infrastructure. While the specific asset may not be clearly identified an annual value can be planned for and held in a fund balance. Replacement of depreciated assets can be budgeted for and accumulated in annual tax policy or tax levies. Collection of funds to realize the creation of longer term community assets can be collected for over a time that precedes the construction of the new asset. • The City's capital fund balance policy may be able to release for use funds (or defer collection of) if a plan exists for how to replace or evaluate the use of capital funds. • Not all City or Community investments lend themselves to traditional business measure of Return on Investment. Some New Creation of Community Assets 1111 may provide gradual improvement to the community `quality of life' whose value will depend on the individual's personal values and interaction with the Community Asset. • Projects that utilize previously collected funds will place the project costs predominantly on the current residents and businesses. Projects that utilize outside grants,borrowed funds or deferral of future taxes will place the project costs predominantly on the future residents and businesses. It is probably appropriate to align the cost and benefits for individual projects so that those who benefit predominantly carry the cost associated with the benefit. Examples: Creation of New Pedestrian Bridge: • Cash Contribution—It would be appropriate to pay for planning and project preparation costs out of existing City funds/budget. The understanding of the community needs, the potential value added and project costs can be covered by the City Departments. Since the benefit for this project will incur to future residents, it is appropriate to consider outside fund sources or commitment of future funds. • Future Fund Sources—In this case there is evidence of a future regional and community benefit. Appropriately placed pedestrian bridges allow for non- motorized movement of people. These people can be current residents,or future • residents/workers within the community. Outside funding sources can include;