4.7. SR 05-06-2013 - Laserfiche WebLink

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Elk REQUEST FOR ACTION River TO ITEM NUMBER Mayor and City Council 4.7 AGENDA SECTION MEETING DATE PREPARED BY Consent May 6, 2013 Tim Simon, Finance Director ITEM DESCRIPTION REVIEWED By Resolution Authorizing a Transfer from the General Fund to Cal Portner, City Administrator the Capital Outlay Reserve Fund REVIEWED BY ACTION REQUESTED Approve by resolution a transfer from the General Fund to the Capital Outlay Reserve Fund. BACKGROUND/DISCUSSION Over the past several months,the Council has reviewed and updated all of our financial management policies which the Council approved on April 15. As part of that process,we reviewed the fund balance policies for our General, Special Revenue, Capital Project,Debt Service, and Enterprise Funds. The fund balance policy sets a minimum and maximum fund balance in the General Fund of 40-45%. During the 2013 budget process,the Council wanted to use any amount above our maximum amount over a period of several years. As you will recall,in accordance with Governmental Accounting Standard Boards (GASB) Statement#54 (reprinted below),the amount above our maximum, except the amount used in the subsequent year's budget (2013),would be transferred to a capital project fund versus being able to assign the amount. We maintain the flexibility each budget cycle to make an annual transfer back to the General Fund to reduce the impact of the property tax levy as done in the past if/as fund balance changes. Paragraph 16 of GASB Statement No. 54 16. An appropriation of existing fund balance to eliminate a projected budgetary deficit in the subsequent year's budget in an amount no greater than the projected excess of expected expenditures over expected revenues satisfies the criteria to be classified as an assignment of fund balance. As discussed in paragraph 15, assignments should not cause a deficit in unassigned fund balance to occur. FINANCIAL IMPACT The amount above the 45%will be included as part of the 2014&2015 budget process. A budgeted Transfer In from the Capital Outlay Reserve Fund may be used for the remaining fund balance. ATTACHMENTS ■ Transfer Resolution P O W E R E D BY N:\Public Bodies\Agenda Packets\05-06-2013\4.7si Fund Balance UocationX£docx aA f U R E