FINANCIAL POLICIES
significant unforeseen revenue shortfalls or unanticipated demands. The other 50 percent will be returned to General Fund Reserves.
C. Capital Improvement Program (CIP) Budget In conjunction with the biennial budget process, the City develops a five-year capital improvements program (CIP). CIP projects are generally valued at over $50,000 and have an estimated useful life in excess of two years. CIP includes the following categories: o Streets and Mobility Improvements; o Facility Improvements; o Landscape Improvements; and o Great Park Improvements. The CIP budget is driven by the City’s goal to appropriately maintain and care for the City’s infrastructure, in order to protect the City’s capital investment and to minimize future maintenance and replacement costs. The CIP budget includes sources of funds in compliance with the Infrastructure Funding policy, previously appropriated funding as well as future five-year funding needs, and estimated future operating costs or savings associated with each capital project. Similar to the operating budget, funding for the first two years of the CIP budget is approved during the biennial budget process. D. Balanced Budget The City Manager presents, and the City Council adopts, a balanced biennial budget, containing estimated revenues equal to appropriated expenditures. The budget is balanced at the individual fund level. The estimated revenue sources must be sufficient to cover proposed uses. Ongoing operations are funded by recurring revenues. City policies on reserve requirements for specific funds are adhered to in the budget. If shortfalls are projected after the budget adoption, during quarterly financial reviews, the City Manager will present a plan to address such shortfalls with sustainable measures in order to achieve a balanced budget by fiscal year-end. E. General Fund Contingency Reserves The City shall maintain a General Fund Contingency Reserve at a level that is equal to at least 20 percent of the General Fund adopted appropriations. A 25 percent reserve level is desired, but will only be achieved when practical. The Contingency Reserve will only be used to help mitigate the effects of unanticipated situations such as natural disasters and severe, unforeseen events. During the fiscal year, the Contingency Reserve may also be used to meet the City’s funds liquidity needs. The City Council may authorize the use of reserves to address an unforeseen emergency. At the time this authorization is given, a plan must also be approved to replenish the reserves to the 20 percent level within two fiscal years.
FY 2019-21 Proposed Budget
515
Made with FlippingBook Learn more on our blog