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110 <br /> -ARZEN HILLS <br /> MEMORANDUM <br /> DATE: August 10, 2007 <br /> TO: Financial Planning and Analysis Committee <br /> FROM: Sue Iverson, Finance Director <br /> SUBJECT: Fund Balance Policy Discussions <br /> BACKGROUND: <br /> One of the priorities that the Council has assigned to this committee is to work on a Fund <br /> Balance Policy. <br /> DISCUSSION: <br /> As a starting point for work on this priority, we first must look at the reasons and objectives for <br /> such a policy. I have attached a chapter from a GFOA book entitled"Financial Policies: Design <br /> and Implementation". This chapter focuses on Fund Balance Policies. We will use this as a <br /> basis for our discussions. As we go through this information we will 1) determine what factors <br /> we want to consider in developing out policies, and 2) what information we need to in order to <br /> make these decisions or to determine these factors. <br /> Ultimately we should try to establish 1) How financial resources are set aside for unreserved <br /> fund balances, 2)Determine the appropriate size of unreserved fund balances, and 3) Methods <br /> for utilizing unreserved fund balance resources. <br /> You will want to refer to the book that I previously provided you on Fund Balance, and I have <br /> also attached some additional information that might be useful for your discussions. <br /> RECOMMENDED ACTION: <br /> Provide staff direction on what information the committee feels is needed to further discuss and <br /> work on this policy. <br /> • <br />