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HomeMy WebLinkAbout1996-11-25 97-38 ORDERCOUNCIL ACTION Date: I1-25-96 Item No. 97-38 Item/SubjeCt: ORDER, Transferring Funds from the General Fund's Undesignated Fund Balance and Workers' Coapensation Reserve to the General Fund's Improvement Reserve and Fire Equipment Reserve Responsible Department: City Manager Commentary: In aegordance with the City's Designated and Undesignated Fund Balance Policy, we attempt to maintain an undesignated fund balance of approximately 7.55 of operating expenditures. The Finance Department has recently completed o annual fund balance sufficiency calculation, copy of which is attached. Based on this analysis, undesignated fund balance as of the fiscal year ended June 30, 1996, will be 8.271 o approximately $405,492 in excess of the 7.58 goal. Far our policy, these funds may be used fora variety of purposes including increasing the designated reserve for improvements, and increasing other established capital reserves where such reserves may be insufficient to meet their purposes. In anticipation of this situation, the various department directors were requested to provide information o various projects o as to which these funds eight be applied. The Directors Were asked to identify potential expenditures which would either address an immediate o pressing capital need or which would result in operating budget savings. Overall, potential expenditures in excess of $2.7M w requested. After analyzing these requests, thefollowing funding recommendations were made to the Finance Committee: Replace Fire Pamper $200,000 Kenduskeag Stream Retaining Wall Repair 190,000 Energy Conservation Projects 108,913 Traffic Signal Maier Plan n.zjp Total $503,163 -ManageYe casements: r Aaeoeiatetl In: Order,der, Expenditure Details, Sufficiency Calculation Budget Approval: F Legal Approval: IntasaFor Passage _ First Reatling Page_of Referral These recommendations; represent approximately $100,000 more than the amount which is available from our undesignated fund balance. As a result, I would also recommend that a additional approximately 99],6]1 be moved from our Reserve for Workers', compensation for these projects. Based an r last actuarial report, a reserve of approximately 92.2M i required as of June 30, 1996. Preliminary figures indicate that our reserve has now reached more than $2.5M and that these additional funds should be available. As you can see, there is also a potential that additional Workers' compensation Reserves may exist. However, I would recommend that we limit Our e to this amount until our ext actuarial report is received in February or march at which time we can reevaluate the Reserve status. These recommendations were wed and a ended by the Finance Committee. The attached Order would transfer funds from our Undesignated Reserve and Workers' Compensation Reserve to our Improvement Reserve and Fire Equipment Replacement Reserve. Separate Council Resolves will be required to actually appropriate these funds. 97-36 Anip:ed to C ilor Sullivan Navembev 25, 1996 _ CITY OF BANGOR (TITLE.) (®rUr, ............ Trsnsferrrng Funds from the General Pmud's Undesignated Fund Balance and Workers' Compensation Reserve to the General Fund's Improvement Reserve arta Fire Equipment Reserve By the ORF Ce awU of Ne City afBargoe: ORDERED, THAT WHEREAS, the City of Bangor's Designated and Undesignated Fund Balance Policy calls for maintaining an undesignated fund balance approximating 7.5E of operating expenditures; and WHEREA6, the annual undesignated food balance sufficiency, calculation for the fiscal year ending June 30, 1996 indicates that our undesignated fund balance has reached 8.27% of operating expenditures; and WHEREAS, our financial policies further outline the purposes to Which am unts in excess of 7.58 may be used which include increasing our designated improvement reserve and other established capital reserves which may be insufficient to meet their purpose; and WHEREAS, the City faces certain capital expenditures which are either of a pressing nature or which Will allow for reductions in operating expenses; HOW, THEREFORE, BE IT ORDERED BY THE CITY COUNCIL OF THE CITY OF BANGOR, THAT: the amount of $200,000 is hereby transferred from the City's Undesignated Fund Balance to the Fire Equipment Reserve. AND, BE IT FURTHER ORDERED, THATr the amount of $205,492 is hereby transferred from our Undesignated Fund Balance to our Improvement Reserve. AND, BE IT FURTHER ORDERED, THAT: the amount of 5971671 is hereby transferred from the Workers' Compensation Reserve to the Improvement Reserve; AND, BE IT FURTHER ORDERED; THAT: these funds are intended to be used for purchase of a replacement pumper for the Fire Department, repairs to the xenduskeag stream Retaining Wall, energy conservation projects at various City facilities, and for the development of a traffic signal master plan. IN CITY COUNCIL November 25, 1996 I CLTY CLERK 9]-38 O R OER Title, Transferring Funds from the General Fund's Undesignated Fond Balance d Workers' Compensation Reserve to the F,eneie$@uud'cImpio en[ Reserve and Fire Equipment Reservem /0� � ..... Couneflman