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� 4 +00N • •_ <br />CITY COUNCIL MEETING DATE: <br />APRIL 18, 2017 <br />TITLE: <br />REVISED BUDGET AND FISCAL POLICY <br />{STRATEGIC PLAN NO 4, 1d} <br />CITY IMANAGP�' <br />RECOMMENDED ACTION <br />Adopt the revised Budget and Fiscal Policy. <br />DISCUSSION <br />CLERK OF COUNCIL USE ONLY: <br />APPROVED <br />❑ As Recommended <br />❑ As Amended <br />❑ Ordinance on 18` Reading <br />❑ Ordinance on 2nd Reading <br />❑ Implementing Resolution <br />❑ Set Public Hearing For_ <br />CONTINUED TO <br />FILE NUMBER <br />On June 4, 2012 the City Council approved the City's Budget and Fiscal Policy (Policy). The <br />objective of the Policy was to establish General Fund Reserve limits as well as budgetary <br />guidelines. The Policy was developed as a result of the 2008 recession that caused a major <br />economic downturn and resulted in significant revenue shortfalls for many governmental <br />agencies. <br />The policy maintains base elements of providing a balanced budget including that ongoing <br />revenues should match ongoing expenditures, as well as that one time funds may only be used <br />for one -time non - recurring expenditures or term specific projects or programs. The revised policy <br />addresses times that the City may encounter structural challenges. In addition, the policy will now <br />include terminology and define one -time funds such as the ending operation balance, operating <br />reserve account, and the unallocated fund (amount). <br />With the attainment of the 20 percent reserve limit, staff is recommending modernizing the fiscal <br />policy to include definitions consistent with the Governmental Accounting Standards Board on <br />depicting fund balances and activities. In addition, staff recommends establishing a minimum <br />reserve limit consistent with the Government Finance Officers' Association recommendation of no <br />less than two months or 16.67 percent of General Fund operating revenues and expenditures. <br />The resulting effect of this change will be increasing the current minimum level from 15 percent to <br />16.67 percent. In addition, the attainment of the 20 percent reserve level will now only be a <br />recommended option. In addition, the recommended limits for the Economic Uncertainty fund will <br />65C -1 <br />