Budget and Financial Policies_rev June 2017

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City Council may authorize use of the Economic Uncertainty Reserve by a two-thirds vote to offset the revenue loss prior to the close of the fiscal year end. 4 corresponding plan to replenish the reserve account must be adopted by the same vote. Upon determination by the Finance Department and report submission to the City Council that a structural deficit exists in the budgeted forecast of the upcoming fiscal year, the City Council may authorize use of the Economic Uncertainty Reserve to balance the budget by two thirds vote of the Council. However, autbor[zatimn to utilize the Economic Uncertainty Reserve beyond two consecutive years isstrictly prohibited. General Work Plan for Achieving General Fund Reserve Objectives The following work plan is intended to reach the unassigned reserve account of 15% in phases. The initial objective is to attain at least a GY6 threshold over the course of the following fiscal year and between 7% and 8Y6 over the subsequent fiscal year. Upon attainment of the phased objectives, a comprehensive review of the general financia� condition of the City will be completed and a new reserve work plan vuiU be developed and submitted for approval that outlines the next intermediate steps for meeting the main, objective of a reserve target level of 1596. Until such time that the General Fund Unassigned Reserve meets the minimum phased requirements as outlined above, the following budgetary and operational guidelines shall be used as a basis to achiev*the various minimum requirements. - Budget consideration, of new programs, personnel, or capital related expenditures shall only be considered lfasource offunding isidentified either through acorresponding cost reduction, anidentified generaY increase in general tax revenue, or a one-time revenue infusion. Source of funding should include consideration nfongoing general maintenance and operational costs. ' Departments will be encouraged to continually achieve savings through internal organizational efficiencies. Technology will be encouraged if it can be demonstrated that a one-time capital infusion can result in savings be,ing generated beyond two years. - Any General Fund savings generated at the fiscal year end can be considered either for term specific operational or capital needs but a minimum of 50% (up to 100%) of the savings shall be deposited into the unassigned reserve balance until such time that the phased reserve levels are met. - Any internal service fund that hos funds in excess of the identified minimum reserve requirement as outlined in this policy, can be utilized as a means to meet the minimum General Fund Reserve requirements. Only unrestricted funds deenned1ransferab�Ae can be utilized, Any transfer tothe General Fund Unassigned Reserve Balance will be submitted to Council for consideration and approval. ln order bogenerate additional savings and until such time that the minimum level of reserves has been achieved, the Budget Office will only utilize a fiscally conservative profile for revenue projections. ' if the phased reserve target requirements asoutlined above have not been met itisrecommended that beginning in FY 14-15 a more conservative projection factor be used to generate forced budgetary savings: (NOTE: Each 1% equates to approximately $ 2m0Dom FY 12-13: 1OOY6ofrecurr[ngrevenue projected; Budget & Financial Polices (Rev.6/2O17) Page