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`Elk REQUEST FOR ACTION <br />~_ <br />River <br />To Item Number <br />Ci ~ Council 3.8. <br />Agenda Section Meeting Date Prepared by <br />Consent Ma ~ 19, 2008 Tim Simon, Finance Director <br />Item Description Reviewed by <br />Establishment of an F,quipment Replacement Fund and Lori ohnson, Citv Administrator <br />Resolution Authoxizuig a'Txansfex From the Capital Outlay Reviewed by <br />Reserve Fund to the Equipment Replacement Fund <br />Action Requested <br />Council is asked to approve the establishment of the equipment replacement fund and authorize a <br />transfer to provide funding. <br />Background/Discussion <br />On b4ay 5, 2008, the City Council reviewed the establishing of an equipment replacement fund to provide <br />a long-term funding source fox the City capital equipment needs. The equipment replacement fund will <br />be used to account fox the purchase and replacement of the City's equipment. A partion of the cost evill <br />be recovered from the departments based on a pro-rated share of the next ten year's replacements, which <br />will be updated annually. <br />The City's fleet committee will also meet regularly to continually update esthnates and work with the <br />finance department to ensure we maintain the appropriate cash flow levels in all forecasts. As part of the <br />budget process fox 2009 we will determine how much can be charged to the departments in the general <br />fund and adjust accordingly. <br />Financial Impact <br />Will be part of the 2009 budget process. The initial uansfex is required to cash flow the purchases since <br />the other funding sources will be received over a 12-month period. <br />Attachments <br />• Resolution authorizing a transfer from the capital outlay reserve fund to the equipment <br />replacement fund <br />Action Motion by Second by Vote <br />Follow Up <br />C:\Documents and Settings\jmillei\Local Settings\'1'empoxazy Internet Pdes\OLK3E\equipmen¢eplacementfund.doc <br />