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City Council Financial Policy Funds (CCFPF)
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Summary:
The estimated General Fund 2019 balance after applying the Comprehensive Financial Management Policy on reserves requirements results in a surplus. City staff is recommending usage of this surplus in line with City Policy, Council Strategic Goals and priority infrastructure needs. The Chief Financial Officer (CFO) presents updates to the CCFPF quarterly and current recommended funding of projects is attached to this memo.
Background:
In 2019, the City Council changed the General Fund Reserve Policy to ensure adequate funding existed for emergencies. Additionally, a secondary layer of reserves was created to account for the negative impact of fluctuating sales tax should a slow in the economy occur. Approximately 20% of the General Fund Operating Budget is set aside for these two committed reserves. These measures ensure citizens will not be impacted with lost services and protect existing positions within the city. In addition, the policy ensures the City of Brookings is following proper best management practices for reserves.
A Comprehensive Financial Management Policy was created that collects all excess funds from the General Fund beyond the necessary 20% restricted reserves. Within the policy, funds should be designated first for projects and/or paying off debt. Quarterly, the CFO presents a total estimated General Fund Balance for guidance and direction of City Council. Operations or funding of ongoing expenditures is not advised as this revenue source is seen as a one-time opportunity. Thus, funding an ongoing expenditure would be unsustainable.
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Attachments:
Memo
Presentation