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HomeMy WebLinkAboutReso 99-094 - Amending Council Policy 407 and Adopting Council Policies 420 and 421 � ♦ , . � • RESOLUTION NO. 99-� A RESdLUTION OF THE CITY COUNCII, OF THE CITY OF REDDING AMENI)ING COUNCIL POLICY 407 (REINViFSTMENT OF PROPERTY SALES AND OTHER CERTAIN REVENUE,S� AND ADOPTING COUNCIL POLICIES 420 (APPROPRIATION TRANSFERS BETWEEN YEAR,S� AND 421 (RESERVE BALANCES IN INTERNAL SERVICE FUND,S�. WHEREAS, the City Council is charged with the responsibility of establishing municipal policies to guide the various functions of the City and, where necessary, to establish procedures by which functions are performed; and WHEREAS, th� City Council wishes to amend its Policy 407 and adopt Policies 420 and 421 to assist in the bud�;eting process as outlined in the accompanying Report to City Council; TH�REFORE, IT IS RESOLVED that the City Council amends Council Policy 407 (Reinvestment of Property Sales and Other Certain Revenues) and adopts Council Policies 420 (Appropriation Transfers Between Years) and 421 (Reserve Balances in Internal Service Funds), copies of which are attached and made a part hereof, to be incorporated in the Council Policy Manual. I HEREBY CE][ZTIFY that the foregoing resolution was introduced, read and adopted at a special meeting of the City Council on the 21st day of June, 1999, by the following vote: AYES: COLTNCII,MEMBERS: Cibula, Kight, McGeorge, Pohlmeyer and Anderson NOES: COiTNCII,MEMBERS: None ABSENT: COUNCIL,MEMBERS: None ABSTAIN: COiJNCII,MEMBERS: None � ROBERT C. ANDERSON, Mayor Attest: Form Approved: � � - � ' � �� ��� � e ` �, Connie Strohmayer, Ci Clerk W. Leonard Wingate, C' Attorney �} '`. v CITY OF REDDING COUNCIL POLICY SUBaJECT RESOLUTION POLICY EFFECTIVE NUMBER NUMBER DATE PAGE Reinvestmei�t of Property Sales and Other Certain Revenues 407 7/1/99 1 Background The City Council proposed adoption of a policy of reinvesting revenues arising out of property sales and other unbudgeted non-recurring revenues into a Capital Improvement/Economic Development Fund aimed at transferring City assets from one form to another. Purpose Adoption would serve as a useful guide to the Council in dealing with the proceeds of property sales and other non-recurring unbudgeted revenues in such a manner that the assets of the City are rolled over from one form to another. Policy Toward the objective of ensuring that capital resources of the City are conserved and invested (or reinvested) in a permanent manner, it is the policy of the City Council of the City of Redding to place funds arising out of property sales and similar non-recurring, non-budgeted transactions into a capital improvement anci economic development fund for otherwise unfunded capital projects or projects that foster economic development. Deviations from this policy may be made only with the express approval of the City Council. CITY OF REDDING COUNCIL POLICY SUBJECT RESOLUTION POLICY EFFECTIVE NUMBER NUMBER DATE PAGE Appropriation Transfers Between Years 420 7/1/99 1 Background Departments have been authorized to make expenditures up to the amount appropriated by the City Council. If expenditures are anticipated to exceed the amount appropriated usually the department must seek a supplemental appropriation from the City Council. Now that the City has adopted a two-year budget there may be times when it would be beneficial for a department to move an appropriation from the first year to the second year or to move an appropriation from the second year to the first year of the two-year budget. In these instances, there is no net impact to the City's budget. Purpose To allow department directors to manage their budget in the most efficient and effective way, the following policy would authorize the department heads, with the City Manager's approval, to transfer appropriations between years of an adopted two-year budget. Policy It is the policy of the City Council of the City of Redding to authorize the department heads, with the City Manager's approval, to administratively transfer appropriations between years of an adopted two-year budget. The following conditions shall be met for all administrative transfers between years: 1. Appropriations shall be transferred only for purposes previously approved by the City Council. 2. Appropriations shall not be transferred between funds. 3. Appropriations shall not be transferred between departments. 4. The number of positions authorized by the City Council shall not be changed administratively. Procedure Appropriation transfers such as those described above shall be approved in the same manner as Appropriation Transfer Requests ( reference Council Policy 401). t ' •,� CITY OF REDDING COUNCIL POLICY SUBa�ECT RESOLUTION POLICY EFFECTIVE NUMBER NUMBER DATE PAGE Reserve Balances in Internal Service Funds 421 7/1/99 1 Background The City of Redding has established internal service funds to provide a useful means of accounting where it is advantageous to centralize the provision of certain goods and services provided to City departments and divisions. An internal service fund should provide services to other departments and divisions on a cost-reimbursement basis. Purpose Internal service funds are used to account for services provided on a cost-reimbursement basis (i.e., without profit or loss). Thus surpluses in an internal service fund may be an indiction that other departments and divisions were over charged for the goods or services they received. To insure departments and divisions are not over charged by internal service funds for goods and services received, the City has implemented the following policy: Policy Internal service funds cash reserves will be reviewed by the Finance Division after the end of a fiscal year. Finance will journal voucher cash reserves in excess of 5.0% in internal service funds back to the originating division or department unless one of the following conditions applies: 1. The excess cash does not exceed $20,000. 2. A justification for retaining the excess balance has been included in the budget issues and approved by the City Manager. 3. A justification separate from the budget process has been presented to and approved by the City Manager. 4. The fund is a self-insurance fund. Self-insurance funds have been established to account for potential risks and payments are not treated on a cash reimbursement basis. In the self insurance funds cash will be returned to the originating divisions when retained earnings is in excess of expected potential liabilities, as determined by the Finance Division and approved by the City Manager, plus a 5% reserve of current appropriations for unexpected expenditures. When funds in a self-insurance fund exceed the above criteria, cash shall be refunded to the originating divisions unless conditions 1, 2 or 3 above applies. The adjustment to cash reserves shall not cause a deficit fund balance in any fund, unless the deficit is a result of depreciation and future assets will be replaced by contributions from other funds.