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Operating Budget Policies <br />PT TR P(lcsF. <br />To ensure the City's annual operating expenditures are based on a stable stream of revenues. The policies <br />are designed to encourage a long -term perspective to avoid pursuing short -term benefits at the expense of <br />future problems. The policies will enable a stable level of services, expenditures, and property tax levies. <br />c(IPF. <br />These policies apply most critically to those programs funded through the property tax, because it is most <br />difficult to deal with fluctuations in this revenue source. <br />P()T .Try <br />X The City will pay for all current expenditures with current revenues. The City will avoid budgetary <br />procedures that balance current expenditures at the expense of meeting future years' expenses. <br />Specifically, accruing future year's revenues shall be prohibited. Practices to be avoided include <br />postponing expenditures, rolling over short -term debt, and using reserves to balance the operating <br />budget. <br />X The budget will provide for adequate maintenance of capital plant and equipment, and for their <br />orderly replacement. <br />X A proportionate share of the administrative and general government costs incurred by the general <br />operating fund of the City shall be borne by all funds as is practicable. Such administrative charges <br />shall be predetermined and budgeted annually. <br />X New programs or proposals shall be reviewed in detail by City staff and both a policy and fiscal <br />analysis shall be prepared prior to budgetary inclusion, and provided to the City Council for its <br />review. <br />X A request for a program or service expansion or reduction must be supported by an analysis of public <br />policy implications of the change. <br />X A request for new personnel must be supported by an analysis demonstrating the need for the <br />position based on workload measures, comparative staffing levels, and department priorities. <br />X A request for purchase of new (additional) capital equipment must be supported by a net present <br />value analysis demonstrating the present value of the benefits of the equipment is greater than the <br />cost of the equipment over the expected life of the equipment. <br />The City has become more dependent on local government aid in recent years as the state has controlled <br />local levies and replaced them with increased local government aid. This has replaced a more stable <br />revenue source (property taxes) with a less stable one. One way to deal with this instability is to develop <br />a budget reserve that can be used if local government aid is significantly reduced without adequate notice. <br />II -12 <br />