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Recreation Fund Long -Term Forecast <br />Incorporating the revenue assumptions, the operating expenditure targets, the proposed <br />interfund transfers, and the updated CIP projections outlined in the preceding discussion, the <br />following chart summarizes a history and projection of revenue, expenditures, and fund balances <br />for the Recreation Fund. <br />The City's Reserve Policy for the Recreation Fund states, <br />The minimum fund balance of the Recreation Fund shall be maintained at or above 15% of <br />current operating expenditures. For purpose of this policy, operating expenditures are defined <br />as all expenditures, excluding interfund transfers and capital outlay. <br />In addition to maintaining an operating reserve, the Recreation Fund will also maintain a <br />capital asset renewal and replacement reserve. The purpose of this reserve is to accumulate <br />funds for the timely renewal and replacement of Recreation Center and Memory Square Pool <br />assets. The methodology for calculating this reserve will be approved by the Finance <br />Committee. <br />The City Council recognizes that the dedicated sales tax and user fee revenues may not be <br />sufficient and the Recreation Fund may also need to rely on annual General Fund transfers. <br />The annual General Fund transfer will be calculated by taking the General Fund subsidy for <br />the Recreation Center/Memory Square Pool in 2017 ($986,300) and inflating that amount on <br />an annual basis by the regional Consumer Price Index for All Urban Consumers. The 2017 <br />General Fund subsidy level is the starting point for the calculation, since that is the last year <br />that the Recreation Center and Memory Square Pool were funded within the General Fund. <br />In addition to the annual General Fund transfer towards the annual operating costs, minimum <br />13 <br />