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HomeMy WebLinkAbout2015-06-08 15-213 ORDERCOUNCIL ACTION Item No. 15-213 Date: June 8, 2015. Item/Subject: Order, Authorizing the transfer 1,000,000 from the Unassigned Fund Balance Responsible Department: Finance Commentary: This Order will authorize the transfer $1,000,000 from the unassigned fund balance to replenish capital reserve funds. The Charter specifies that the City will maintain a fund balance of no less that 8.33% of the prior years operating expenditures. The audit for fiscal year ending 2014 indicates that the City has an unassisgned balance of approximately $9.6 million which represents 9.92% of the prior year expenditures. Over the past several budget cycles, the City has not budgeted sufficient funds to maintain capital replacement funds. As a result, it is recommended by staff that $1,000,000 be transferred to the capital funds as follows; $800,000 to the Capital Improvement Fund and $200,000 to the Bus Replacement Fund. If approved, the unassigned fund balance will drop to approximatley $8.6 million which represents 8.9% of the 2014 operating budget. This item was reveiwed by the Council at a budget meeting on May 27, 2015 and recommended for approval. Debbie Cyr Department Head Manager's Comments: Associated Information: Resolve Budget Approval: Finance Director Legal Approval: City Solicitor Introduced for _X—Passage First Reading Referral Page —1— of —1— Assigned to Councilor Sprague CITY OF BANGOR 15-213 JUNE 8, 2015 (TITLE) Order, Authorizing the Transfer of $1,000,000 from the Unassigned Fund Balance WHEREAS, The Charter requires that the City Council shall target an unassigned fund balance of no more than 16.66% of the operating budget for the General Fund. The target balance shall be established at 8.33% of the last year's General Fund operating budget. WHEREAS, The unassigned fund balance at the end of the prior fiscal year was approximately 9.92% WHEREAS, The transfer of $1,000,000 from the unassigned fund balance will leave the balance at 8.9% of the previous years operating budget, well within the Charter established limits; and WHEREAS, The transfer to unassigned fund balance has been proposed to replenish capital funds including $800,000 to the Improvement Reserve; and $200,000 to the Bus Replacement Fund. BE 1T ORDERED BY THE MY COMM OF THE CITY OF BANGOR, THAT The Finance Director is hereby authorized to transfer $1,000,000 from the unassigned fund balance for the following purposes; $800,000 to the Improvement Reserve and $200,000 to the Bus Replacement Fund IN CITY COUNCIL JUNE 8, 2015 MOTION MADE AND SECONDED FOR PASSAGE PASSED CITY CLERK