5.j Resolution 10-16-18-05 Amending the Fund Balance Policy
CITY OF SCANDIA
RESOLUTION NO. 10-16-18-05
A RESOLUTION AMENDING THE FUND BALANCE POLICIES
AS REQUIRED BY GASB 54
WHEREAS, the Governmental Accounting Standards Board ("GASB") has adopted
Statement 54 ("GASB 54"), a new standard for governmental fund balance reporting and
governmental fund type definitions that became effective in governmental fiscal years starting
after June 15, 2010, and
WHEREAS, the City Council passed Resolution 11-20-12-01 approving a fund balance
policy, assigning fund balances and establishing a fund balance goal,
WHEREAS, the City Council has determined that the fund balance goal is not sufficient to
ensure the funds will be available for operations since the first half of property tax revenues are
not disbursed until July of each year.
NOW, THEREFORE, BE IT HEREBY RESOLVED BY THE CITY COUNCIL OF THE CITY OF
SCANDIA, WASHINGTON COUNTY, MINNESOTA, that it should and hereby does adopt the
attached “Fund Balance Policy”, said policy taking precedence over any other policy that may
have been established in the past that may be in conflict.
Adopted by the Scandia City Council this 16th day of October, 2018.
________________________________
Christine Maefsky, Mayor
ATTEST:
___________________________________
Neil Soltis, Administrator/Clerk
Resolution No.: 10-16-18-05
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FUND BALANCE POLICY
Fund balances measure the net financial resources available to finance
expenditures of future periods.
The City’s fund balances will be maintained to provide the city with sufficient
working capital and a margin of safety to address emergencies without borrowing.
The fund balances may only be appropriated by approval of the City Council.
In circumstances where an expenditure is to be made for a purpose for which
amounts are available in multiple fund balance classifications, the order in which
resources will be expended is as follows: restricted fund balance, followed by
committed fund balance, assigned fund balance, and lastly, unassigned fund
balance.
ASSIGNMENT OF FUND BALANCES:
Capital Improvement Fund: The existing fund balance is assigned to various infrastructure
improvement projects within the City, except those projects paid from business type
activities (enterprise fund).
Park Improvement Fund: The existing fund balance is assigned to acquisition and
development of city parks.
Equipment Replacement Fund: The existing fund balance is assigned to purchasing motor
vehicles and heavy machinery.
Local Road Improvement Fund: The existing fund balance is assigned for road
infrastructure project.
FUND BALANCE GOAL
General Fund: Maintain fund balance of 50% to 65% of total annual General Operating
Fund expenditures. If the balance of the unassigned account rises above 65% at the end
of the fiscal year, the amount above 50% shall either be budgeted in the next year’s
annual operating budget or transferred to a capital improvement fund. The City
Administrator shall annually report the projected unassigned fund balance of the
General Fund when the annual budget for the forthcoming year is presented to the City
Council.