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295 <br />Operating Fund Reserve Policy <br />296 <br />297 <br />Pua)ose <br />298 <br />299 <br />u <br />To provide a cushion against unexpected revenue and income interrupt *10 11S. <br />"100 <br />'101 <br />U <br />To provide working capital by :ensuring sufficient cash flow to meet the City's needs <br />*'02 <br />throughout the year <br />3 0'-3 <br />304 <br />305 <br />306 <br />J <br />The City will maintain a general fund reserve of 50% of the general funds total annual <br />307 <br />operating budget. This ensures that the City has adequate funds on hand to provide 1-*or <br />308 <br />operations between bi-ai-inual property tax collection periods. Any surplus beyond the <br />309 <br />required general, and reserve may be transferred to another reserve furid with a funding <br />.3) 10 <br />shortfall <br />12 <br />J <br />The City will strive to create a reserve in the Recreation Fund to equal 25% of the <br />313 <br />amival recreation budget, This reserve will provide a cash flow cushion and reduce the <br />3 14 <br />inter-fund borrowing expense to the Recreation Fund. Because of morle--'A frequent cash <br />`15 <br />inflows, a 25% reserve will be adequate to support the daily cash needs of the fund <br />316 <br />317 <br />Ll <br />The Community Development Fund is supported solely by building porn fees and <br />318 <br />charges. Because the economic envirormient has a major effect on this Fund, a fund <br />319 <br />balance of 25-50 % of the annual budget is a reasonable target. It is expected that as <br />`20 <br />economic downturns take place, this reserve will provide for a transition period during <br />-3 2 1 <br />which the Council will be able to assess and to better match operations with the <br />322 <br />economic need <br />323 <br />324 <br />U <br />City enterprise funds shall have operating cash reserves sufficient to provide for <br />325 <br />monthly cash flow, and for a reasonable level of equipment and infrastructure <br />326 <br />replacen-ient. major reconstruction or system upgrades, may need to be funded from <br />327 <br />enterprise revenue bonds. Annual utility rate reviews will be made in regard to <br />328 <br />projected operating expenses and capital improvements. The Council will, on an annual <br />329 <br />basis, establish rates in accordance to operating cost recovery and the projected capital <br />330 <br />improvements <br />331 <br />332 <br />:1 <br />All other operational funds e.g. License Center, Information Technology, etc are <br />'_3 3) 3 <br />expected to operate with positive reserve balances of 10-25% of the arinual operating <br />334 <br />budget. Eac , n operational fund shall be reviewed on an ajuival basis to assure the and <br />335 <br />balance i's in line with the fund's objectives <br />336 <br />337 <br />L) <br />A one time capital gain on the City's treasury portfolio in 1998 has provided for a <br />338 <br />Taxpayer Reduction fund which has been dedicated to providing art ongoing tax <br />339 <br />reduction to Roseville property taxpayers. The intent of this and is to transfer the <br />340 <br />ani-mal interest earnings to the General Fund to partially reduce the necessary tax levy. <br />I Ut <br />