2020-07-08 CC Packet - Laserfiche WebLink

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RESOLUTION NO. 20- A RESOLUTION AMENDING THE FUND BALANCE POLICY WHEREAS, City Council has reviewed its fund balance policy language; and WHEREAS, the specific language of the policy does not meet City Council practice; and WHEREAS, it is desirable to change the policy to match with the more conservative effect of the current practice; and WHEREAS, the City Council wishes to maintain a significant General fund unassigned fund balance for purposes of offsetting any significant revenue decreases, maintaining a reserve for any natural disasters or unanticipated calamity, and providing sufficient cash flow to avoid short term borrowing; NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF CENTERVILLE, ANOKA COUNTY, STATE OF MINNESOTA: L PURPOSE The purpose of this policy is to establish specific guidelines the City of Centerville will use to maintain an adequate level of fund balance to provide for cash flow requirements and contingency needs because major revenues, including property taxes and other government aids are received in the second half of the City's fiscal year. The purpose of this policy is to also establish specific guidelines the City of Centerville will use to classify fund balances into a categories based primarily on the extent to which the City is bound to honor constraints on the specific purposes for which amounts in these funds can be spent. IL CLASSIFICATION OF FUND BALANCETROCEDURES 1. Nonspendable • This category includes fund balance that cannot be spent because it is either (i) not in spendable form or (ii) is legally or contractually required to be maintained intact. Examples include inventories and prepaid amounts. 2. Restricted • Fund balance should be reported as restricted when constraints placed on those resources are either (i) externally imposed by creditors, grantors, contributors, or laws or regulations of other governments or (ii) imposed by law through constitutional provisions or enabling legislation.