1996 AGN JUL 16 I29 - Laserfiche WebLink

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�+'• -- := CIT'( OF :OL.TCN PDA TO CITY 1-WAUEP P.07 Reserve Analysis'' objecdva To analyze and recommend appropriate levels of reserves to (a) ensure that they are adequate to provide for the needs of each fund program and (b) meet program needs without unnecessarily obligating scarce dollar resources. Summary The reserve f=& analyzed include: • Genial Fund Emergency Reserve General Fared - Contingency Reserve • General Liability rnenerance Fund workers' Compensation Insurance Fund Accrued Leave Roearve Fund Fleet R isoement Reserve Capital EgWpmerd Replacement Fund Perch fund is currezaiy supported by charges to the operating budgets and other interdepartmcrtal transfers. Each fund should maintain a positive fiord balance and a reserve fed by appropriate internal charges and ttansiem The question becomes one of establishing adequate charges to operatmg budgets to keep the Amd in balance and funding a prudent reserve while avoiding an over commitment of dollar resources. A prudent set aside is one that provides 8nanclal security to the fiend without placing an =realistic burden on operating resources to support it. In good economic tunes, the City can afford to be more proactive in building up reserves. But, when money is tight, the City may not be able to afford the luxury of obLigating the optimum amount of money to such purposes and incrrarental steps may be necessary. Background The initial Long Term Financial flan was completed in. LTFP), . plan made recommendations addressing negative fund balances and the critical need to build up severely underfu ndod and non-existent reserve levels. The ' LTFP prescribed aamral amounts to be contributed to these funds over five years in order to accomplish those objectives. The antral amount to be caatributed updated in the LT'FP based on aemal contributions made in the fiscal year and adjustments in the negative find balanced_