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Attachment C 1 Finance Commission -- Excerpt of June 14, 2022 Minutes 2 3 Review Capital Investment Policy 4 Finance Director Pietrick updated the Commission on the Capital Investment Policy. She noted 5 the policy was last updated in 2019. 6 7 Vice Chair Sagisser asked if there was a replacement for how much the cash reserve should 8 remain at for the Street Fund. Ms. Pietrick indicated there is not. The fund is currently supported 9 by levy and Municipal State Aid (MSA) dollars. If the City has a street project that is on an MSA 10 road the City receives dollars. The fund is currently running around five million dollars for a 11 fund balance. She explained as long as the fund can cover the next ten yearsÓ worth of projects 12 and the fund is analyzed yearly, that seems like reasonable reserves. 13 14 Vice-Chair Sagisser thought previously the discussion was around making sure the street reserve 15 fund was well financed for a long time so it should be left alone. He noted he did not remember a 16 lot of the details of the conversation but he would be interested to see what the rest of the 17 Commission thinks about that. His opinion is that the desire was to keep at least some reserve 18 and to make sure it is funded out ten years. He would like to change the language to reflect that. 19 20 Commissioner Dahir asked what the ideal amount of money staff would like to have in the fund 21 reserve. He wondered if this should be a set amount or set to a number of years. 22 23 Ms. Pietrick thought the years would be preferable, simply because the City has no idea what 24 costs will be in the future and even with a ten year plan the most reliable number and projects are 25 in year one through five. This is kind of two-fold because staff does examine all of the Capital 26 Funds each year and last year some changes were made to the tax levy. She thought using the 27 years rather than the dollar amount is better because the further out this goes the less is known 28 what a dollar will cover. 29 30 Commissioner Bester asked if staff was working harder than needed by having that extra ten 31 years to go out to twenty years with questionable values. Ms. Pietrick indicated it helps to start 32 seeing potential areas where funding will be needed. Last year was the first year the City 33 Manager and herself sat down with all of the CIP funds and really examined every fund, looking 34 at the chart, and where the fund balance was going to go negative they explored options with the 35 tax levy and brought forward a list of funds that would need help in the short term and the goal 36 was to get the funds positive through ten years, if not longer. This helps to get a handle on what 37 might be happening down the road. Commissioner Bester thought this plan was terrific. 38 39 Ms. Pietrick recommended increasing the Capital Assets definition to ten thousand dollars from 40 the five thousand. She noted this corresponds with the CityÓs purchasing threshold. The 41 Commission agreed. Ms. Pietrick reviewed the Enterprise Fund definition with the Commission. 42 She noted the Enterprise funds are not all one hundred percent fee supported. The golf course 43 gets transfers in. The change would be from Ðone hundred percentÑ to ÐprimarilyÑ. She 44 explained this was the first discussion on the policy and can be brought back to the next meeting 45 for further discussion when more Commissioners are present. The Commissioners concurred. 46