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Attachment B Commissioner McRoberts asked if the question boils down to whether the surplus stays in one budget or it if stays in five buckets. Chair Schroeder questioned whether it is easy to remove the capital. Finance Director Miller responded that when the money is removed, right now, all of this cash is discretely presented in the financial statements. That is already there. He explained the capital will get blended with other funds. Separate CIP funds can be created, but there is no good mechanism to display every separated fund in the financial statements.The financial statement would get quite large. The Commission suggested having a discretely presented License Center capital fund and another discretely presented License Center operating fund. This will get to better transparency for citizens. Finance Director Miller noted the general fund and Parks and Rec funds also have capital funds; they are just not discretely presented. The Commission discussed pulling out the License Center, to display operations and capital; also, how to separate the operating funds from the CIP. Finance Director Miller noted there are generally accepted accounting principles, which staff will continue to follow; but moving the capital out from the operating and still showing the reserve funds is easy to do. Commissioner Bachhuber commented the cash reserve fund is there to provide insurance for departments. It is unnecessary to provide insurance on 5 funds at a premium when it can be provided across all funds at once. It costs the City less on unused capital when it is done across the board. This does not reduce anyone’s budget. It was discussed what would happen if there is a deficit. It was suggested that the City should budget for increasing the cash reserve fund the year it is needed. Commissioner Bachhuber moved, seconded by Commissioner Murray, to propose that the Council adopt the strategy that cash reserve policy should be one where the City removes the capital funds, creating CIP funds for those accounts, and sweeping any excess. Once all those funds are at least at a minimum, any excess would go into a centralized account which the Council would be expected to take action on, whether that is for to help shore up CIP deficits or for tax relief or for any other purpose. Those amounts would not just sit in cash reserve funds. Commission Discussion Commissioner Zeller expressed concern about the last box on the flowchart. He would like to see a little more framework around a specific recommendation. Something to provide guidance would be a prudent thing to do, and he would not support a motion without those parameters.