City Council Agenda and Packet 2019 07 16 Budget Retreat

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SUBJECT: FINANCIAL POLICIES DATE: JULY 16, 2019 PAGE 4 OF 5 SUMMARY OF PROPOSED AMENDMENTS Staff is proposing a variety of amendments to the current policies. Attached are the policies as they were adopted on December 15, 2015, with the proposed amendments redlined within the documents. Below is a summary of the proposed amendments by policy section. Introductory Section The proposed amendments include minor changes to definitions for Capital Budget and Capital Improvement Plan (C-I-P). The proposed amendments also eliminate the term Open Space & Parks Fund Targeted Fund Balance and its definition. Policy Section 1 — General Policies The proposed amendments include minor changes to some of the financial indicator formulas to better match the definitions within the Introductory Section. Policy Section 2 — Reserve Policies The proposed amendments include: • The elimination of the Open Space & Parks Fund targeted fund balance requirement; • A formula definition for the recurring annual transfer from the General Fund to the Open Space & Parks Fund; • A statement that, "The City Council will annually consider interfund transfers of excess General Fund or Capital Project Fund balances to the Open Space & Parks Fund for property acquisition reserves."; • The establishment of a minimum unrestricted fund balance and a capital asset renewal and replacement reserve for the Recreation Fund; • A statement that, "It is the intent of the City Council that the dedicated sales tax and user fee revenues generated by the Recreation Center and Memory Square Pool facilities cover the operating costs for those facilities, fund the 15% minimum fund balance, and fund the capital asset renewal and replacement reserve. "; • A formula definition for the maximum recurring annual transfer from the General Fund to the Recreation Fund; • A formula definition for the recurring annual transfer from the Capital Projects Fund to the Recreation Fund; and • The establishment of a minimum unrestricted fund balance and a capital asset renewal and replacement reserve for the Golf Course Fund. Policy Section 4 — Revenue Policies The proposed amendments include a statement of the City Council's intent to review fees yearly and a statement that annual fee inflators may be used during years in which a calculation of full cost is not done. CITY COUNCIL 1 COMMUNICATION