12-13-2011 Agenda - Laserfiche WebLink

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provisions or enabling legislation. Examples of items that may be considered restricted include unspent bond proceeds, unspent grant proceeds, tax increments, certain property tax levies • approved by a referendum, and accumulated funds in debt service funds. Committed fund balance — Fund balance should be reported as committed for amounts that can only be used for specific purposed uses pursuant to constraints imposed by formal action of the government's highest level of decision-making authority (City Council). Commitments may be changed or lifted only by the government taking the same formal action that imposed the constraint originally. An example of committed fund balance would be the City Council committing funds for economic development purposes. Assigned fund balance—Amounts that are constrained by the government's intent to be used for specific purposes, but are neither restricted nor committed, should be reported as assigned fund balance. Assigned fund balance includes (a) all remaining amounts (except for negative balances) that are reported in governmental funds other than the general fund, that are not classified as nonspendable and are neither restricted nor committed and (b) amounts in the general fund that are intended to be used for a specific purpose in accordance with first sentence of this paragraph. Intent can be expressed by the government body or by an official or body to which the governing body delegates the authority (Director of Finance and Administrative Services and/or City Administrator). An example of assigned fund balance would be the City's portion of a construction project where other funding was received with the requirement of a match. Unassigned fund balance — residual amounts that are available for any purpose in the general fund. This category can only be found in the general funds, as by being in any other fund, the City has stated its intent to use if for the purpose of that fund. Committed, assigned, and unassigned fund balance combine to make unrestricted fund balance. Changes Due to GASB 54 This does not change how the City of Arden Hills conducts business. All of the changes will be from a presentation standpoint in the City's Comprehensive Annual Financial Report (CAFR) and the Fund Balance Policies. This will also affect how we present the budget. Other than the new classifications being presented in the CAFR and budget, there are several other changes of note. One change will be related to the classification of the City's current Special Revenue Funds. I have attached an illustration of the City's current financial structure and the proposed financial structure with the implementation of GASB 54. The only funds that will remain Special Revenue Funds will be the Cable Fund and the EDA funds. The Cable Fund has external restrictions and the EDA is a blended component unit of the City which requires this to be reported as a Special Revenue Fund. The Community Service Fund and Parks Fund are used for capital purposes and thus, reassigned to Capital Funds. Since the charitable gambling revenue (currently in the Community Service Fund) is restricted for public safety capital uses, this will be folded into the Public Safety Capital Fund and the Parks Fund will just be moved to the Capital Fund category. Per GASB 54, TCAAP must be folded into the General Fund as a department, thus eliminating the need to transfer General Fund monies to sustain this fund, and Risk Management will be moved to an Internal Service Fund.