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Attachment B Finance Director Millerstated this chart gives the transparency of where the excess reserves came from. Cities have gone to great lengths never tohave a pile of money sitting aside with an undecided future. That used to happen all the time, and there was fair amount of criticism from the public. The Commission discussed the best way to display the cash reserves. It was also noted that there is a relationship between the CIP and the cash reserves. It was suggested by Chair Schroeder that when the money is earmarked for something like the License Center, it should not be a cash reserve fund; it should be in a CIP. It is easier to tell the public that this money is in the CIP fund than it is just sitting there in the cash reserves. Commissioner McRoberts stated it is important to have the cash reserves split out to help the Council and public see where those funds are coming from. Commissioner Zeller noted he has tried, since the last meeting, to put some scenarios together to see how this would work. He noted this policy does not address the deficit side of things, which happens almost as frequently as surpluses. In addition, the FC has recommended a policy to deal with excess amounts in the budgets. He recommended rejection of the proposal as it has been presented, to create a single cash reserve fund. Commissioner Zeller moved to REJECT the future initiatives funding program as presented by the City, put together by staff and dated on July 12, 2017, and recommend sticking with the current operating and fund reserve policy. Finance Director Miller noted the Council’s direction was not to comment on staff’s proposal but rather to comment on the creation of a cash carry-forward policy and process. Staff had already given its recommendation as a separate aside. The Council wants to know if what is contemplated on page 2 of the staff report is a good idea. Commissioner Zeller withdrew his motion. Commissioner Zeller emphasized that any policy needs to address a deficit. Chair Schroeder noted she did not support the policy put forward by the staff. Most of the Commission had come to that conclusion, she recalled. Chair Schroeder commented if capital cannot be removed from the operation funds, then cash carry-forward does not work. Finance Director Miller noted that removing the capital is possible. The first two do not have capital, but the last three do. There is a mechanism to remove the capital; that is easy, as shown in the flow chart. The question is whether to sweep what is left over into a single fund. That is the remaining question.