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CC_Minutes_2023_0605
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CC_Minutes_2023_0605
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Roseville City Council
Document Type
Council Minutes
Meeting Date
6/5/2023
Meeting Type
Regular
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Regular City Council Meeting <br /> Monday,June 5, 2023 <br /> Page 6 <br /> Commissioner Bester explained the $1.5 million is fifteen percent of the $10 <br /> million that is typically carried as investible funds. <br /> Mayor Roe knew there were some limitations in the State law that allows cities to <br /> do this as well as in the City's own policies. He indicated the return mentioned is <br /> on that $1.5 million with the ten percent average return versus the two percent <br /> interest. That is where the net return of$1.2 million comes from on the initial $1.5 <br /> million. Mayor Roe noted he wanted to clarify those numbers for folks that might <br /> not have been tracking that at home. <br /> Councilmember Groff asked when the projections were made on the last sheet. He <br /> wondered if any actual averages were used from the ten or twenty years or was that <br /> just an example. <br /> Commissioner Bester explained the second page of the packet shows the forty-year <br /> history of the S&P 500 and that on average has increased in value by 10.1 percent <br /> per year over that forty-year period. <br /> Councilmember Schroeder indicated she knew that the Finance Commission had <br /> been working on this for a while, all the way back to getting the policy changed to <br /> now going from policy change to actions. She appreciated all of the work the <br /> Finance Commission had done on this. She particularly appreciated the examples <br /> because that helps people understand what is being talked about. <br /> Chair Davies explained another issue she wanted to get the Council's feedback on <br /> is the unusual situation with the General Fund and the Excess Cash Reserve Fund, <br /> which most cities do not have. It had occurred to her that it may be confusing to <br /> the average citizen. She explained the Finance Commission would like to explore <br /> a little bit more into why the City has these two funds, if it is necessary, or if it <br /> should be folded into the General Fund. <br /> Mayor Roe thought the Excess Cash Reserve Fund was a part of the General Fund <br /> already and from the point of view of the City's financial reporting and auditing, it <br /> is part of the General Fund but was a segregated, specific portion that is dedicated <br /> to this purpose. The notion being that if the City happens to receive more revenue <br /> than the City has spent money in particular funds over the course of the previous <br /> year, and it puts the City above its target policy range for balances in those funds, <br /> then the excess on top of the upper range of the balance can be swept into this fund. <br /> He noted the City may have either unexpected purchases or may have unexpected <br /> costs related to something like Emerald Ash Borer, or something like that. Or, the <br /> City may wish to use that to provide short-term property tax relief if there is a <br /> particularly high increase to the budget because of certain things the City needs to <br /> do but may not want to increase the tax levy quite so high for the taxpayers. He <br /> explained the City is capturing some funds that otherwise may be in excess of what <br /> individual operating areas of the City may need by policy, according to the range <br />
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