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Finance Commission Minutes August 21, 2014 Page 3 of 9 require a large capital expenditure or investment and if these are planned for then the City would have the funds available. Chair Schroeder explained that having so many different funds could create confusion with residents and one of the goals of the Finance Commission was to create transparency and clear communication with residents. Finance Director Miller explained the decision for what funds to display can be flexible depending on how much money is specifically earmarked in the fund. The ones that are seen in the financial statements have been segregated to be sure they have more transparency than it would if all the funds were combined into one. Chair Schroeder suggested the City could still have the different funds but then roll it together into one report that would be easier for people to read. Finance Director Miller explained the City maintains approximately 100 different funds and these are rolled up into the 15 that are shown in the financial reports. These remaining funds could be combined but the City does work to adhere to the Generally Accepted Standards of Financial Reporting for Local Governments. Chair Schroeder stated one of the things she has for the Commission to look at is formatting of documents for the public. There is a difference between what the City would need for things such as bonding but there is also a format that the average resident would find usable. In order for the Commission to engage the residents, the Commission would need to find a way to communicate with them. She asked if the Commission was comfortable with the goals that the Reserve Policy established for these funds. Vice Chair Rohloff asked if the Commission should recommend to the Council adding language to the Reserve Policy that addresses the funds that are over the goal amounts established in the policy. Commissioner Bachhuber asked if the balances in the funds were to be maintained at goal throughout the year or just at the end of the year. He also asked how high or low the funds were throughout the year. He stated the funds could drop below the goal level quickly if there was a down turn in the economy. Finance Director Miller stated the intent of the Reserve Policy is that the fund is measured at the end of the fiscal year. One of the main reasons for having reserves is to provide cash flow in- between revenue collection periods. The main source of revenue for the City is property taxes and these are collected in May and December. The Reserve Policy states the fund is measured at the end of the Fiscal year, which is December 31 and that is also when the fund has just received a large cash deposit. The City then uses these funds for the next six months until the next large influx occurs and it is not unusual for the Reserve Fund to get down to 5%. The cash flow needs of each fund have been analyzed to determine the appropriate goals for each fund. He stated the City Council wanted the Finance Commission to review the context of the Cash Reserve Policies