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�4r�� . "1 � �� _. Memo To: Mayor and City Council '� "�� Bill Maiinen, City Manager � From: Chris Miller, Finance Dir�u[o�f (� � Date: Apri116,2007 Re: Prelinainary Discussion on City Budget and Financial Policies Date: 4/16/07 Item: 5.1 Financial Policies Introduction As the Council is aware, the City recently completed a 20-year visioning process which outlined a number of goals and strategies that conceptually, should guide budgeting decisions. However, it is recognized that embarking on a 20-year strategy will likely require extended discussions to prioritize the stated goals and to identify action steps. This process will likely extend well past the State-mandated September 15t�' deadline for submitting a preliminary 2008 Budget. Due to these time constraints, for the 2008 preliminarv Budget it is suggested that the Council concentrate its efforts on budget and financial policies that can be used to provide direction to Staff in formulating a recommended budget. Typically Staff delivers a recommended budget to the Council in early July, which then allows for Council budget discussions in late July and August, before finally adopting a preliminary budget by September 15 ". In 2006, the Council conducted a series of goal-setting sessions that resulted in the formulation of several goal statements. This included a budget-related goal statement that was revised at the May 15,2006 City Council meeting to read as follows: Establish a long-term financial plan that provides for the sustainability of City programs, services, and infy�asir�ucture while maintaining the City's strong financial condition, and which provides for the necessary budgeting controls under a streamlined budgeting process. Within this goal statement, the Council expressed a desire to revisit the City's budget policies. 'I'hese policies include: a) Operating budget policy b) Capital improvement policy c) Debt policy d) Revenue policy e) Asset replacement policy � Cash Reserve policy