Agenda - Council Work Session - 02/22/2022

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CC Work Session 2. 3. Meeting Date: 02/22/2022 Information Title: Review of Current Policy Allocating Excess/Deficient General Fund Revenues Purpose/Background: The City Council originally adopted a policy on February 22, 1994,known as the Excess/Deficient Revenue Policy (Resolution#94-02-045 - Resolution Establishing a Financial Policy for the Purpose of Allocation of Excess/Deficient General Fund Revenues)with the last amendment of this policy on May 10, 2016 (Resolution #16-05-089) a copy of which is attached. The policy states that the General Fund fund balance will be at 50% of the next year's operating expenditures,plus any encumbrances and compensated absences. At the March 23, 2021 City Council meeting when Resolution#21-073 was adopted to distribute the year ending 2020 excess revenue,the City Council stated that they wanted to review and possibly amend this policy prior to the distribution of an excess/deficient revenues applicable to year ending 2021. The 2021 allocation is estimated at approximately$43 8,000 of excess revenue. The current policy distributes the excess/deficient revenue to 4 funds: 30% each to the funds of Equipment Replacement Fund, Capital Maintenance Fund and Public Improvement Revolving Fund. The remaining 10% is allocated to the Public Facilities Fund. Respective Estimated Fund Balances are attached to show ending balances for each fund. These do not reflect any excess revenue for 2021. The purpose of this worksession is to decide if the council chooses to stay with the current allocated percentages or determine new percentages of how the excess revenue should be distributed. Timeframe: 15 minutes Funding Source: Responsible Party(ies): Finance Director Outcome: Review of Current Excess/Deficient Revenue Policy and recommend changes, if any, and review the distribution of the 2021 excess revenues. Attachments Reso#16-05-089 Excess/Deficient Revenue Allocation