HomeMy WebLinkAbout8.1 General Fund Reserves for FY 2015-16OF
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DATE:
TO:
STAFF REPORT
CITY COUNCIL
June 21, 2016
Honorable Mayor and City Councilmembers
CITY CLERK
File #330 -20
FROM: Christopher L. Foss, City Manager J
SUBJECT: Special Designations of General Fund Reserves for Fiscal ear 2015 -16
Prepared by Colleen Tribby, Director of Administrative Services
EXECUTIVE SUMMARY:
In accordance with the City of Dublin's Fund Balance and Reserves Policy, the City Council will
consider special designations of General Fund reserves for Fiscal Year 2015 -16.
FINANCIAL IMPACT:
Approving special designations of General Fund reserves will not result in any net change
to total fund balance, but would shift resources among reserve categories.
RECOMMENDATION:
Staff recommends that the City Council adopt t h e Resolution Authorizing a Special
Designation of General Fund Reserves for Fiscal Year 2015 -16, and direct Staff to
implement the changes in the financial records.
Reviewed By
Assistant City Manager
DESCRIPTION:
The City of Dublin's Fund Balance and Reserves Policy (the Policy) identifies the five
classifications of fund balance to be used in the financial reporting of governmental funds, and
defines the methodology of allocating net resources before the fiscal year end. The five
classifications are: Non - Spendable, Restricted, Committed, Assigned, and Unassigned.
Specifically, the Policy states that any excess fund balance, after designations to all other
categories, and after providing for at least two months of ongoing expenditures in the cash
flow reserve, go to the reserves for Pension and Retiree Health (50 %) and Non - Streets Capital
Improvement Projects (50 %).
This Staff Report transmits a Resolution authorizing special designations of General Fund
reserves as of June 30, 2016 (Attachment 1). While the Fiscal Year 2015 -16 year -end
Page 1 of 3 ITEM NO. 8.1
balances will not be final until the close of the City's financial books, Staff can make reasonable
assumptions about estimated reserve balances at this point.
The General Fund Reserves Summary (Attachment 2) provides a listing of reserve balances by
category, and includes a description of the reason for any change. Many of the changes are due
to the spending down of Committed reserves for actual capital improvement project expenses
during Fiscal Year 2015 -16. Other shifts are related to year -end accounting policies, such as the
annual adjustments to long -term General Fund advances, and the spending down of carry -over
reserves from the prior year.
Recommended Reserve Designations
The City's Reserve Policy calls for the Available Cash Flow to be a minimum of two months and
a maximum of four months. The City has maintained an average of 3.3 months in that reserve
over the last three years. In the current report, the shifting of reserves provides for $23.3 million
in the available cash flow reserve at year -end, which represents 4.0 months of the Fiscal Year
2016 -17 operating budget.
After accounting for the cash flow reserve, and incorporating reserve changes for accounting
purposes, Staff estimates that there will be $14.2 million available to shift among reserves. The
following table illustrates all recommended reserve designations for June 30, 2016. The
Resolution addresses only the Committed Reserves, as City Council approval of Assigned
Reserves is not necessary by resolution.
Recommended Reserve Designations, FY 2015 -16
Balance Balance
June 30. 2015 Addition June 30. 2016 Note
Committed Reserves:
Economic Stability Reserve
$6,000,000
$2,000,000
$8,000,000 In support of fiscal sustainability initiative
Fire Services OPEB (Retiree
Health)
$9,196,000
$2,008,000
To equal most recent valuation, plus one year amortized
$11,204,000 payment of unfunded liability
Storm Drain Capture
$400,000
$178,436
$578,436 To cover total project costs
Shannon Center Parking Lot
$775,000
$300,000
$1,075,000 To cover total project costs
Utility Undergrounding
$0
$1,170,190
$1,170,190 Per Adopted Budget FY 2015 -16
Innovations and New
Opportunities
$1,372,785
$750,000
$2,122,785 Increase funding; approx $500k to be used for PD technolog
Dublin Sports Grounds
$0
$2,500,000
$2,500,000 For future renovation of Dublin Sports grounds
Subtotal, Committed Reserves
$8,906,626
Assigned Reserves:
Non - Streets CIP Reserve
$3,132,016
$747,500
$3,879,516 Half of residual reserves
Catastrophic Loss
$10,608,186
$760,345
$11,368,531 To equal 15% of book value of City buildings
Service Continuity
$2,771,500
$228,500
To cover 18 -month lag between development revenues and
$3,000,000 City costs incurred
City Pension/ OPEB (Retiree
Health
$9,866,853
$1,747,500
Lump sum funding against $13.3 million unfunded obligation
(for pension and retiree health combined); plus half of
$11,614,353 residual reserves.
Replace HVAC Units at Civic
Center
$0
$1,000,000
In additionto $1.2 million available in Building Replacement
$1,000,000 Fund
Relocate Parks Dept. to
Police Wing
$0
$250,000
$250,000 Upon completion of the new Public Safety Complex
Fire Equipment Replacement
$0
$600,000
$600,000 Per Adopted Budget FY 2016 -17
Subtotal, Assigned Reserves
$5,333,845
Total Reserve Designation
$14,240,471
"Reserve allocation previously approved by the City Council
Page 2 of 3
As mentioned above, the FY 2015 -16 numbers are preliminary until the close of the books in the
fall. When the numbers are finalized, Staff recommends that any additional residual reserves be
allocated according to the City's Fund Balance and Reserves Policy (split evenly between the
reserves for Pension and Retiree Health, and Non - Streets Capital Improvement Projects).
NOTICING REQUIREMENTS /PUBLIC OUTREACH:
None.
ATTACHMENTS: 1. Resolution Authorizing a Special Designation of General Fund
Reserves for Fiscal Year 2015 -16
2. General Fund Reserves Summary
Page 3 of 3
RESOLUTION NO. - 16
A RESOLUTION OF THE CITY COUNCIL
OF THE CITY OF DUBLIN
* * * * * * * * * * * * * * * * * * * * * * * * * **
AUTHORIZING A SPECIAL DESIGNATION OF GENERAL FUND RESERVES FOR
FISCAL YEAR 2015 -16
WHEREAS, the City's Fund Balance and Reserves Policy requires special fund balance
allocations to be adopted by the City Council, and allows the City Council to take action prior to the
end of the fiscal year to direct a specific assignment of the fund balance; and
WHEREAS, Staff reviewed updated information regarding fund balance and estimated one-
time revenues during the preparation of the Fiscal Year 2016 -17 Budget;
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Dublin does
hereby make a special allocation of the estimated Fiscal Year 2015 -16 year -end balance to the
Committed fund balance sub - categories as follows:
BE IT FURTHER RESOLVED that, any net resources remaining after special designations,
and after meeting the minimum requirement of two months cash flow in the Unassigned fund balance
and a maximum of 15% asset book value in the Catastrophic Loss reserve, will be assigned as
described in the policy: a) 50% to Pension and Other Post Employment Benefits; and b) 50% to the
Non - Streets Capital Improvements Program reserve.
PASSED, APPROVED AND ADOPTED this 21st day of June, 2016.
ATTACHMENT 1
FY 2014 -15
Actual
FY 2015 -16
Increase
FY 2015 -16
Decrease
FY 2015 -16
Change
FY 2015 -16
Year End
Committed
38,531,179
8,906,626 (7,242,240)
1,664,386
40,195,565
Economic Stabil ity
6,000,000
2,000,000
2,000,000
8,000,000
Downtown Public Impr
1,000,000
(459,647)
(459,647)
540,353
Open Space Funding
-
-
Affordable Housing
1,000,000
1,000,000
Emergency Communications
741,000
-
741,000
Fire Svcs 0PEB
9,196,000
2,008,000
2,008,000
11,204,000
Innovations & New Opport
1,372,785
750,000
750,000
2,122,785
Jt City/ School Projects
46,015
(46,015)
(46,015)
-
One -Time Initiative
1,341,408
1,341,408
Specific Committed Reserves
-
-
Emerald Glen Aquatic Complex
3,000,000
(3,000,000)
(3,000,000)
-
Maintenance Facility
250,023
(250,023)
(250,023)
-
Cemetery Expansion
5,272,210
5,272,210
Fallon Sports Park
2,000,000
(1,800,000)
(1,800,000)
200,000
Civic Ctr Expansion
136,737
(33,118)
(33,118)
103,619
Emergency Generator
-
-
Public Safety Complex
-
-
Storm Drain Capture
400,000
178,436 (578,436)
(400,000)
-
Shannon Center Parking Lot
775,000
300,000 (1,075,000)
(775,000)
-
Utility Undergrounding
-
1,170,190
1,170,190
1,170,190
Advance to Public Facility Fee
6,000,000
-
6,000,000
Dublin Sports Ground
-
2,500,000
2,500,000
2,500,000
BE IT FURTHER RESOLVED that, any net resources remaining after special designations,
and after meeting the minimum requirement of two months cash flow in the Unassigned fund balance
and a maximum of 15% asset book value in the Catastrophic Loss reserve, will be assigned as
described in the policy: a) 50% to Pension and Other Post Employment Benefits; and b) 50% to the
Non - Streets Capital Improvements Program reserve.
PASSED, APPROVED AND ADOPTED this 21st day of June, 2016.
ATTACHMENT 1
AYES:
NOES:
ABSENT:
Mayor
ATTEST:
City Clerk
Page 2 of 2
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Special Designations of General
Fund Reserves for FY 2015-16
June 21, 2016
Background
Special designations
Exact 15-16 fund balances not known yet
We have enough information to recommend
specific funding of Committed reserves
Any changes after books close should affect
only the Assigned category
Special Designations
Balance
June 30, 2015 Addition
Balance
June 30, 2016 Note
Committed Reserves:
Economic Stability Reserve $6,000,000 $2,000,000 $8,000,000 Fiscal sustainability
Fire Services OPEB (Retiree
Health)$9,196,000 $2,008,000 $11,204,000 Recent valuation
Storm Drain Capture $400,000 $178,436 $578,436 For project costs *
Shannon Center Parking Lot $775,000 $300,000 $1,075,000 For project costs *
Utility Undergrounding $0 $1,170,190 $1,170,190 Per Adopted Budget 15-16 *
Innovations and New
Opportunities $1,372,785 $750,000 $2,122,785 Replace and increase funding
Dublin Sports Grounds $0 $2,500,000 $2,500,000 For future impr project
Total Additions $8,906,626
Special Designations
Balance
June 30, 2015 Addition
Balance
June 30, 2016 Note
Assigned Reserves:
Non-Streets CIP Reserve $3,132,016 $747,500 $3,879,516 Half residual reserves
Catastrophic Loss $10,608,186 $760,345 $11,368,531 15% of book value of City buildings
Service Continuity $2,771,500 $228,500 $3,000,000 To cover development exp lag
City Pension / OPEB (Retiree
Health $9,866,853 $1,747,500 $11,614,353 Lump sum funding + half residual reserves
Replace HVAC Units at Civic
Center $0 $1,000,000 $1,000,000 Cover complete replacement
Relocate Parks Dept. to
Police Wing $0 $250,000 $250,000 Upon completion of the PSC
Fire Equipment Replacement $0 $600,000 $600,000 Per Adopted Budget 16-17 *
Total Additions $5,333,845
Total Reserves
Reserve Balances
Actual
14-15 INCREASE DECREASE
Projected
15-16
Non-Spendable 1,475,691 5,000 (649,740) 830,951
Restricted 500,000 - - 500,000
Committed 38,531,179 8,906,626 (7,242,240) 40,195,565
Assigned 35,875,264 5,333,845 (6,243,458) 34,965,651
Unassigned-Unrealized Gains (242,263) (242,263)
Unassigned (Available)21,566,623 23,507,085
TOTAL RESERVES 97,706,494 28,380,908 (26,330,413) 99,756,990
Change 2,050,496
Recommendation
-Adopt the Resolution Authorizing a Special Designation of
General Fund Reserves for FY 2014-15; and
-Direct Staff to implement the changes in the financial
records.