6. EDSR 07-15-2013 - Laserfiche WebLink

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Financial Management Policies Purpose The City of Elk River is responsible to its citizens to manage its resources wisely and adopting financial policies is an important step to ensure that resources are managed responsibly. The policies provide the framework for the overall fiscal management of the city and guide the decision- making process. Most of the policies represent long standing principles, traditions and practices which have guided the city in the past and have helped maintain financial stability over the past years. These financial policies will be reviewed periodically to determine if changes are necessary. Objectives • Providing sound principles to guide the decisions of the City Council and management. • To provide both short-term and long-term financial stability to city government by ensuring adequate funding for providing and protecting infrastructure needed by the community today and for years to come. • Protecting and enhancing the city's credit rating and prevent default on any municipal obligations. • To protect the City Council's policy-making ability by ensuring that important policy decisions are not constrained by financial problems or emergencies. Revenue and Expenditure • The city will provide long-term financial stability through sound short and long term financial planning. • The city will estimate its annual revenues and expenditures in a conservative manner so as to reduce exposure to unforeseen circumstances. • The city will project revenues and expenditures for the next five years and will update these projections each budget process. • Whenever user charges and fees are determined to be appropriate and the direct benefits are identifiable, the city will establish user charges and fees at a level related to the cost of providing the service (operating, direct,indirect,and capital). Fees will be reviewed annually. • To the extent feasible, one-time revenues will be applied toward one-time expenditures or placed into reserves. One-time revenues will not be used to finance ongoing programs. Utilities • The City Council sets fees and user charges for municipal sanitary sewer utility and garbage collection. The Utilities Commission sets fees and charges for the water and electric utilities. The city will encourage the Utilities Commission to adopt financial management policies similar to the policies stated in this section. • The city will strive to set users fees for municipal utilities at a level that creates financially sustaining enterprises. Financial Management Policies Page 1