4.8. SR 05-05-2014 City of
Elk=' Request for Action
River
To Item Number
Mayor and City Council 4.8
Agenda Section Meeting Date Prepared by
Consent May 5, 2014 Tim Simon, Finance Director
Item Description Reviewed by
Resolution Authorizing a Transfer From the Cal Portner, City Administrator
General Fund to the Capital Outlay Reserve Fund Reviewed by
and Surface Water Management Fund
Action Requested
Approve,by resolution,a transfer of General Fund balance.
Background/Discussion
During the April 7 work session,the Council reviewed the 2013 General Fund results of operations and
the long-range financial model. In addition, transfers being proposed were reviewed.
The fund balance policy sets a minimum and maximum fund balance in the General Fund of 40-45
percent. During the 2013 budget process, the Council wanted to use any excess above our maximum
amount over the next several years. With the proposed transfers we will have met the goal with the 2015
budget. As you will recall,with Governmental Accounting Standard Boards (GASB) Statement#54
(reprinted below),the amount above our maximum will be transferred out. We still have the flexibility of
each budget cycle to make an annual transfer in similar to the way it may have been done in the past and
have the same impact.
Paragraph 16 of GASB Statement No. 54
16.An appropriation of existing fund balance to eliminate a projected budgetary deficit in the subsequentyear's
budget in an amount no greater than the projected excess of expected expenditures over expected revenues satisfies the
criteria to be classified as an assignment of fund balance.As discussed in paragrapb 15, assignments sbould not
cause a deficit in unassigned fund balance to occur.
Financial Impact
The excess above 45 percent will be included as part of the 2015 budget process. A budgeted transfer in
from the Capital Outlay Reserve may be used for the remaining fund balance which will bring it to the
goal of$200,000. The remaining balance above the $200,000 will go to the Surface Water Management
Fund.
Attachments
■ Resolution
P a w E A E U a r
Template Updated 4/14 INIM UREI
City of
Elk
River
Resolution 14-
A Resolution of the City of Elk River Authorizing a Transfer From the
General Fund to the Capital Outlay Reserve Fund and Surface Water
Management Fund
WHEREAS, The City of Elk River's Financial Management Policies includes a General
Fund Balance policy in excess of forty five percent shall be allocated to other purposes at the
discretion of the City Council; and,
WHEREAS, The City Council has requested that the unassigned fund balance in the
General Fund for 2013 be a minimum of 40 percent and a maximum of 45 percent; and,
WHEREAS, The City Council has considered the various uses of the balance in excess of
the 45 percent;
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Elk
River,Minnesota, as follows: transfer funds from the General Fund Balance to:
Capital Outlay Reserve Fund $91,792
Surface Water Management Fund $34,024
Passed and adopted this 5"'day of May 2014.
John J. Dietz,Mayor
ATTEST:
Tina Allard, City Clerk
P O w E R E U 9 1
1`4 U