2006_0717_Packet - Laserfiche WebLink

Home

�'�ih�� o� ��►_ � _ _ 1 �_ � � h .11�ITIti"�i�S�� '`�r� PUl'�OSO Operating Fund Reserve Policy ❑ To provide a cushion against unexpected revenue and income interruptions 4 To provide working capital by ensuring sufficient cash flow to meet the City's needs throughout the year �'�,] i�- ❑ The City will maintain a general fund reserve of 50% of the general fund's total annual operating budget. Any surplus beyond the required general fund reserve may be transferred to another reserve fund with a funding shortfall * Comment * the current reserve level for this fund is only 30%. An additional $2 million is needed to comply with this policy. Current General Fund revenues and budgeting practices are unlikely to produce the surpluses needed to comply with this policy. ❑ The City will strive to create a reserve in the Recreation Fund to equal 25% of the annual recreation budget. This reserve will provide a cash flow cushion and reduce the inter-fund borrowing expense to the Recreation Fund. Because of more frequent cash inflows, a 25% reserve will be adequate to support the daily cash needs of the fund * Comment * the current reserve level for this fund is 0%. An additional $800 thousand is needed to comply with this policy. Current Recreation program fee rrtechartis�ns and budgetingpractices are unlikely to produce the surpluses needed to comply with this policy. ❑ The Community Development Fund is supported solely by building permit fees and charges. Because the economic environment has a major effect on this Fund, a fund balance of 25-50 %�98°�� of the annual budget is a reasonable ta�r ei �. It is expected that as economic downturns take place, this reserve will provide for a transition period during which the Council will be able to assess and to better match operations with the economic need * Comment * the current reserve level for this fund is only 1 S%, although it is expected to grow steadily over the next few years. �