DATE: June 27, 2024
TO: Mayor and Members of the City Council
FROM: John R. Gillison, City Manager
INITIATED BY: Noah Daniels, Finance Director
SUBJECT: Consideration to Approve Updated City General Fund Reserve Funding Goals Policy. (CITY)
RECOMMENDATION:
Staff recommends that the City Council approve the attached updated City General Fund Reserve Funding Goals Policy.
BACKGROUND:
The City General Fund Reserve Funding Goals Policy establishes the methodology for the funding goals for each of the City General Fund reserves, including the replacement of vehicles, equipment, and computer equipment/technology. This policy, which the City Council initially approved in June 2012, formalizes the City General Fund reserves, establishes some new ones, and sets quantifiable goals for each reserve.
There were no changes to the City General Fund Reserve Funding Policy besides minor grammatical changes and clarification of the calculation of the reserve goal for the Finance Department. Specifically, the following:
1. The fund goal for the PERS Rate Stabilization reserve is equal to the “value of projected future employer contributions” to clarify the schedule from which to base the funding goal in the respective CalPERS actuarial valuation report.
2. This indicates that the consumer price index utilized to increase the funding reserve for the General Plan Update reserve is the Ontario-San Bernardino Area from December.
3. Indicating that calculations based on the budget are the “adopted expenditures budget for operations” in the upcoming fiscal year.
ANALYSIS:
Per policy, upon completing the City’s annual audit, the Finance Director prepares a schedule summarizing the funding status of each reserve for the City Manager to use in future budgetary planning.
This policy does not apply to reserves determined to be non-spendable under the City’s Fund Balance Policy, nor does it apply to reserves that pertain to outstanding encumbrances (i.e., purchase orders) or unrealized gain on investments (GASB31) as of fiscal year end.
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FISCAL IMPACT:
There are no fiscal impacts due to adopting the City General Fund Reserve Funding Goals Policy.
COUNCIL MISSION / VISION / VALUE(S) ADDRESSED:
The approval of the General Fund Reserve Funding Goals Policy supports the City Council’s core value of providing and nurturing a high quality of life for all by demonstrating the active, prudent fiscal management of the City’s financial resources to support the various services the City provides to all Rancho Cucamonga stakeholders.
ATTACHMENTS:
Attachment 1 - City General Fund Reserve Funding Goals Policy