Page 354 - Budget Book FY2020-2021

Financial and Budget Policies and Procedures

non-recurring expenditures, such as capital projects—except in circumstance in which
revenues for a given year under perform budgeted estimates and/or fund balance is
insufficient to meet the Minimum Fund Balance policy. In such a case, this policy can be
suspended for only one year at a time by a majority vote of the City Commission. This sunset
provision for the exception will expire at the end of each fiscal year affected.

Minimum Fund Balance
The General Fund shall maintain a minimum fund balance of 140 days of operating
expenditures.

Minimum Working Capital Balances
The Water and Sewer Funds, individually, shall maintain a minimum working capital
balance of 120 days of operating expenses. The Bridge Fund shall maintain a minimum
working capital balance of 90 days of operating expenses.

Management Fee to Enterprise Funds
Each enterprise fund as well as the Development Corp pays a management fee to the General
Fund an amount as set by the budget. This charge shall be construed as a payment for
general administrative overhead, including management, accounting, legal, data processing,
and personnel services.

Depreciation (Replacement) Funds
The Water Fund sets aside funds equal to 40% of actual depreciation in a separate fund for
the replacement of capital plant, buildings, infrastructure, and equipment. The Sewer Funds
in like manner sets aside 40% for the same purposes.

The General Depreciation Fund and Sanitation Depreciation Fund, which were established
by transfers from the General Fund and Sanitation Fund, respectively, are used to
acquire/replace rolling stock for the General Fund and the Sanitation Fund, respectively.
These funds are replenished to provide for future replacements by charging a rental charge
to the benefited fund equal to cost plus 10% for anticipated inflation over the estimated
useful life of each asset. The City Commission would like to extend this policy to all other
enterprise funds as the cash flow from operations permits. All other funds will allocate
sufficient funding in their operating budgets for adequate maintenance and replacement of
capital plant, buildings, infrastructure, and equipment.

Priority in Applying Restricted vs Unrestricted Resources
When an expense is incurred for purposes for which both restricted and unrestricted net
assets are available, the City typically first applies restricted resources, as appropriate
opportunities arise, but reserves the right to selectively defer the use thereof to a future
project or replacement equipment acquisition.

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