HomeMy WebLinkAboutResolutions - No. 2020-274RESOLUTION NO. 2020-274
A RESOLUTION OF THE LODI CITY COUNCIL
APPROVING THE CITY OF LODI FISCAL YEAR 2020/21
BUDGET AND FISCAL POLICIES
WHEREAS, on October 19, 2016, the City Council approved a comprehensive
set of Budget and Fiscal Policies which called for a bi-annual review; and
WHEREAS, City staff has conducted bi-annual reviews in accordance with the
current policy; and
WHEREAS, on June 3, 2020, City staff presented the FY 2020/21 Financial Plan
and Budget and requested that Council temporarily suspend the Pension Stabilization
Policy provision due to the uncertainties of the COVID-19 pandemic impact to financial
resources; and
WHEREAS, staff wishes to formally include the Pension Stabilization suspension
language into the policy for Fiscal Year 2020/21.
NOW, THEREFORE, BE IT RESOLVED that the Lodi City Council does hereby
approve the Budget and Fiscal Policies for Fiscal Year 2020/21, attached hereto as
Exhibit A.
Date: November 18, 2020
I hereby certify that Resolution No. 2020-274 was passed and adopted by the
Lodi City Council in a regular meeting held November 18, 2020, by the following vote:
AYES: COUNCIL MEMBERS — Chandler, Nakanishi, and Mayor Kuehne
NOES: COUNCIL MEMBERS — None
ABSENT: COUNCIL MEMBERS — Mounce
ABSTAIN: COUNCIL MEMBERS — None
�JENNIFE CUSMIR
City Cler
2020-274
City of Lodi
Budget and Fiscal Policies
01" �A
Exhibit A
CALIFORNIA
Adopted by the Lodi City Council
February 20, 2019
Resolution 2019-21
City of Lodi Budget and Fiscal Polices
Table of Contents
1. Purpose...............................................................................................................................................3
2. Budget Development...................................................................................................................... 3
3. Budget Administration and Adjustment........................................................................................... 5
4. Appropriation Limit.............................................................................................................:........... 7
5. Components of Fund Balance........................................................... .......... ....................................... 7
6. Fund Balance Policies.......................................................,.,............................,......................,...... 8
7. General Fund Reserves................................................................................ ........................... 8
8. Measure L Fund Reserves............................................................................................................. 10
9. Special Revenue Fund Reserves .............. ........... ............................... ........... I ........ ....... ........ 10
10. Enterprise Fund Reserves ....................... ..........,........................,,.........,.............,......,...... 13
11. Internal Service Fund Reserves................................................................................................... 13
12. Capital Improvement Plan............................................................................................................ 14
13. Encumbrance Accounting........................................................................................................... 16
14. Pension Stabilization Policy......................................................................................................... 16
15. Review and Update...................................................................................................................... 18
2
1. Purpose
The City's primary financial objective is to maintain the fiscal stability of the
organization. The purpose of this policy is to establish guidelines for budget
development, administration, and management as well as outline the City's fiscal policies
in regard to cost recovery of various programs, target reserve levels in all funds and
funding mechanisms for various programs.
2. Budget Development
The budget will reflect the goals and priorities of the Council each year and make the best
use of available fiinding within those goals and priorities. While goals and priorities may
change from year to year, some basic tenets will apply to all budgets. Those tenets are
reflected below.
A. The General Fund budget will be balanced each year, without the use of reserves.
Current year revenues will support current year expenditures.
B. One-time revenue will be used to fiind one-time expenditures or be placed in
reserves. One-time revenue will not be used to fund on-going operations.
C. Annual budgetary savings will be used to fiend one-time expenditures or be placed
in reserves.
D. Funding for the Vehicle Replacement Fund shall be based upon annual
depreciation schedules for vehicles and amounts will be reflected in departmental
budgets.
E. Funding for the Other Post -Employment Benefits (OPEB) Fund shall be no less
than the Actuarial Required Contribution shown in the actuarial report and
charged to each fund based upon ratio of current frill time positions. All reserves
in the Benefits Fund category in excess of 25% of estimated annual costs for
benefits in this fund shall be budgeted for investment in the City's OPEB trust
fund.
F. Funding for CalPERS pension costs are as follows. Current year Normal Cost
will be budgeted in each fiind based on the estimated cost for employees in that
fund. Current year Unfunded Accrued Liability (UAL) payments will be
budgeted within each fiind based on each fund's share of employee's within each
class (Safety or Miscellaneous). For purposes of allocating UAL, employees
funded by Measure L will be allocated to the General Fund. The City will budget
for the monthly payment of the UAL but will make the annual UAL payment to
recognize the approximately 3.6% savings offered by CalPERS on this option.
The Deputy City Manager will then use the UAL savings to make Additional
Discretionary Payments (ADP) to CalPERS to further reduce the City's UAL.
G. Funding for the Information Technology (IT) Replacement Fund shall be based
upon the replacement cycle for equipment contained in the fund.
H. Budgetary allotments for OPEB, Pension Stabilization and IT Replacement shall
be reflected in the Non -Departmental Organization Unit for all General Fund
units.
a. Special Revenue, Enterprise and Internal Service funds will reflect
budgetary allotments for these items within their respective funds.
I. Fixed Assets
a. Capital purchases of $10,000 or more, with a three year useful life, will be
capitalized.
b. Infrastructure additions or new construction of $10,000 or more will be
capitalized.
c. Vehicle purchases of any amount will be capitalized and useful lives will
be determined based upon the Government Finance Officers Association
Best Practices guidelines.
d. Straight-line depreciation will be used for all depreciable assets.
J. Library
a. The Library is primarily funded through a transfer from the General Fund.
Council will set the level of funding each year based upon available
General Fund revenue.
K. Parks, Recreation and Cultural Services (PROS)
a. Recreation and Community Center Programs
i. The goal is to recover, on average, 40% of program costs from
participants. Individual programs may be fully self-supporting
while other programs may have a nominal cost recovery ratio.
b. General Fund Transfer
4
i. The General Fund Transfer shall be determined by Council each
year. The intent of the General Fund Transfer is to cover the costs
associated with Parks Maintenance, PRCS administration, Debt
Service and Hutchins Street Square Maintenance.
L. Community Development
a. The Community Development Department should primarily be self-
supporting through fee revenue.
b. A General Fund Transfer, determined by Council each year, will be
designed to support the value of the general information function that the
department provides and support at least one-half of the costs associated
with a Youth Outreach function designed to divert youth involvement in
gang activities.
M. Enterprise Funds
a. Enterprise finds will set fees and rates at levels that meet operating, debt
service, capital and reserve needs.
N. Internal Service Funds
a. internal Service finds will set rates and charges at levels that will ensure
full recovery of costs each year.
3. Budget Administration and Adjustment
The City Council is ultimately responsible to the public for the delivery and conduct of
City services and facilities. Accordingly, the Council appropriates funds to ensure the
delivery of services at the levels and in the priority established by Council. The legal
level of budgetary control is at the fund level.
A. City Manager
The City Manager, as the chief administrative officer, provides staff with general
direction in the development and formulation of the City Manager's budget
recommendations to Council. This includes: evaluating and assessing current and
anticipated issues facing the City; determining the demand for services and
facilities; identifying the concerns of the citizenry; assessing the current and
projected financial condition of the City; and determining the final staffing
recommendations.
B. Deputy City Manager/Internal Services Director
The Deputy City Manager/internal Services Director, as the chief financial
officer, is responsible for budget development and day-to-day administration of
adopted budgets. This includes: developing and issuing the budget instructions
and calendar; advising the City Manager on budget policies and issues, including
the recommended level of funding for each department within the General Fund;
reviewing budget requests to ensure they are complete and accurate; preparing the
preliminary budget recommendations for review by the City Manager; and
publishing the approved budget, Capital improvement Plan, and Budget in Brief
documents.
C. Department Directors
Department directors are responsible for preparing their operating and capital
budget requests in accordance with the City's budget instructions and managing
their respective departments within their approved budget allotments.
D. Failure to Adopt a Budget
if the City fails to adopt the budget by July 1, the City Council may elect one of
the following courses of action until passage of a budget and appropriation of
funds: (1) Provide the City Manager with Continuing Resolution Authority to
allow continued services at expenditure levels not greater than those in the prior
year budget; or (2) Require staff to obtain prior approval for any expenditure
(payment) of City funds.
E. Public Record
The budget document will be available on-line at the City's website
(www.lodi.goy). Hard copies will be available for public review at the Lodi
Public Library, City Hall and the Carnegie Forum.
F. Budget Adjustments
City Council approval is required for any increase in total appropriations within
any individual find. All budget adjustments that increase one fund's total
appropriations, including net zero budget adjustments, must have City Council
approval.
b. The City Manager and Deputy City Manager have the authority to adjust
appropriations within a fund, so long as total appropriations within the find do
not increase. This includes adjustments between departments within a fund.
Department directors have the authority to adjust appropriations within their
department, so long as total appropriations within the department within the
fund do not increase.
4. Appropriation Limit
The Council will annually adopt a resolution establishing its appropriation limit
calculated in accordance with Article XIIIB of the Constitution of the State of California,
Section 7900 of the State of California Government Code, and any other voter -approved
amendments or State legislation that affect the City's appropriation limit.
5. Components of Fund Balance
A. Governmental Accounting Standards Board Statement Number 54 — Fund
Balance Reporting and Governmental Fund Type Definitions outlines the
requirements to report hind balance for governmental funds in specific
classifications which create a hierarchy primarily based upon the extent to which
a City is bound to constraints on the specific purposes for which the funds can be
spent. Fund Balance consists of the following five categories:
Non -spendable hind balance: amounts that cannot be spent because they
are either (a) not in a spendable form (e.g., inventories or pre-paids) or (b)
legally or contractually required to be maintained intact (e.g.,
endowment).
Restricted fiend balance: amounts that can only be spent for the specific
purposes stipulated by external resource providers either constitutionally
or through enabling legislation (e.g., grants, gas tax, impact fees).
iii. Committed fiend balance: amounts that can be used for the specific
purposes determined by formal action of the government's highest level of
decision making authority. Committed fund balance can be changed only
by the government taking the same formal action that initially created the
commitment. (e.g., Council approved catastrophic or economic reserves).
iv. Assigned fund balance: amounts that are intended to be used by the
government for specific purposes. Intent can be established by either the
governing body or delegated to a City official.
v. Unassigned find balance: the remaining amount of fund balance after all
other fund balance classifications are accounted for and can be either
positive or negative. Positive unassigned fiend balance is available for any
Purpose.
G. Fund Balance Policies
A. Committing Fund Balance
The City Council is the City's highest level of decision making authority
and the formal action that is required to be taken to establish, modify, or
rescind a fund balance commitment is a resolution or ordinance approved
by the City Council at a City Council meeting. For reporting purposes, the
resolution or ordinance approving, modifying or rescinding a fund balance
commitment must be approved prior to the last day of the fiscal year for
which the commitment is to be reported. The amount of the commitment
may be determined in a subsequent period.
B. Assigning Fund Balance
i. The City Council retains the authority to assign fund balance.
C. Hierarchy of Fund Balance Use
i. When multiple categories of fund balance are available for expenditure,
the City will spend the most restrictive funds first before moving down to
the next category with available funds in the following order:
1. Restricted
2. Committed
3. Assigned
4. Unassigned.
7. General Fund Reserves
Maintaining reserves in the General Fund is critical to the successful and stable short- and
long-term operations of the City. Adequate reserves in the General Fund ensure that the
City is able to respond to emergencies and continue providing services to the citizens of
Lodi. Adequate reserves also ensure that the City will have sufficient funds available to
meet its operating, capital and debt service obligations.
A. Catastrophic Reserve
i. A Catastrophic Reserve is established within the General Fund. This
reserve is established to maintain the ability of the City to meet
operational expenses during times of declared emergency or major
catastrophe.
8
I . it is recognized that during a time of emergency, the City will need
to expend more resources than normal operations dictate to meet
the community's need. In addition to an increased level of
expenditure, the tax base of the City may be impaired after a major
catastrophic event.
ii. The amount of the Catastrophic Reserve shall be a minimum of 8% of
annual General Fund revenues, including Operating Transfers.
iii. The Catastrophic Reserve shall be exclusive of all other reserve amounts.
iv. Council may draw on the Catastrophic Reserve only upon declaration of
an emergency pursuant to the Lodi Municipal Code.
v. If the Catastrophic Reserve falls below 8% of annual General Fund
revenue, including Operating Transfers, the City Manager shall prepare a
plan within three months of Council approval of the Comprehensive
Annual Financial Report (CAFR) to restore the reserve balance to the 8%
level within 12 months.
vi. The Catastrophic Reserve is not intended for normal unanticipated
expenditures and shall be funded before all other committed General Fund
reserves.
B. Economic Reserve
i. An Economic Reserve is established within the General Fund. This
reserve is established to maintain the City's economic viability and to
meet seasonal cash flow needs.
It is recognized that economic cycles can cause significant
fluctuations in the revenue streams of the City and the recovery
from down cycles can be prolonged and affect service levels to the
community dramatically. The Economic Reserve is intended to
assist the City in maintaining service levels while revenues recover
from a down economic cycle.
ii. The amount of the Economic Reserve shall be a minimum of8%of annual
General Fund revenues, including Operating Transfers.
iii. The Economic Reserve shall be exclusive of all other reserve amounts.
iv. Council may draw on the Economic Reserve only upon adoption of a
resolution of the City Council.
9
v. If the Economic Reserve falls below 8% of annual General Fund revenue,
including Operating Transfers, the City Manager shall prepare a plan
within three months of Council approval of the Comprehensive Annual
Financial Report (CAFR) to restore the reserve balance to the 8% level
within 12 months.
vi. The Economic Reserve is not intended to be used to encourage
development through the expansion of infrastructure to undeveloped areas
of the City and shall be funded once the General Fund Catastrophic
Reserve is frilly funded.
C. Should there be a lower fund balance presented in the proposed Budget, the City
Manager shall first recommend use of Pension Stabilization Funds to offset
Unfunded Accrued Liability (UAL) costs in the Fiscal year. The Deputy City
Manager shall first pay all UAL costs with current year resources and shall only
draw on the PSF in the final month of the Fiscal Year if in his/her opinion it is
still estimated a draw is needed to meet the 16% total fund balance requirement.
8. Measure L Fund Reserves
As a general purpose revenue, maintaining healthy reserves in the Measure L fund is
critical for the same reasons as in the General Fund. Adequate reserves ensure that the
City will continue to be able to provide Lodi citizens the services funded by Measure L in
the long term. The Measure L Fund shall maintain the same 8% Catastrophic and 8 %
Economic Reserves as outlined under Section 7 A. and Section 7 B. above. Measure L
Funds shall not be subject to the City's Pension Stabilization Policy. By allocating UAL
in the method described in Section 1 F. above, the General Fund will cover any UAL
costs attributable to the employees funded by Measure L.
As a new revenue stream beginning April 1, 2019, Measure L will take time to build up a
reserve to comply with this policy. Initially, the fund balance will be built to the frill 16%
combined fund balance over a three year timeframe beginning with the FY 2019/20
budget and ending with FY 2021/22. Budgets from FY 2019/20 through FY 2021/22
shall include approximately 5.33% of revenue as a deliberate set aside to fiend these
reserve categories.
9. Special Revenue Fund Reserves
Maintaining reserves in the City's Special Revenue Funds is also critical to the successful
and stable short- and long-term operations of the City. Adequate reserves in the Special
Revenue Funds, where appropriate, ensure that the City is able to carry out the purpose of
the special revenue fund and ensure compliance with underlying laws and contractual
10
provisions associated with the funds. Additionally, bond rating agencies often evaluate a
City's General Fund financial resilience by looking at reserves that may be drawn from
Special Revenue finds to help support General Fund activities.
A. Library
i. Since the Library is primarily funded by a General Fund transfer, there is
no need to duplicate reserves associated with the transfer amount within
the Library Fund.
ii. Reserves within the Library Fund should be maintained at a minimum
level of 16% of annual Non -General Fund Transfer revenue.
B. Parks, Recreation and Cultural Services (PROS)
i. Since a significant portion of PRCS revenue comes from a General Fund
transfer, there is no need to duplicate reserves associated with the transfer
amount within the PRCS fund.
ii. Reserves within the PRCS Fund should be maintained at a minimum level
of 16% of annual Non -General Fund Transfer revenue.
C. Community Development
i. The Community Development Fund is primarily self-supporting from fee
revenue associated with development activities. The activities and
financing of this Rind are subject to wide fluctuations based upon the state
of the development economy. Many of the fees assessed are collected
ahead of services being provided. in the event of an economic downturn,
the hind will have collected fees for services that have not yet been
provided. As such, it is prudent to carry a large reserve to recognize that
the reserve represents services that have not yet been provided.
ii. Reserves within the Community Development Fund should be maintained
at a minimum level of 50% of annual operating expenses, including
transfers.
D. Vehicle Replacement
i. It is the City Council's goal to maintain reserves in the Vehicle
Replacement equal to the accumulated depreciation of the vehicles in the
fund.
11
1. The City Manager's proposed budget will recommend fully
funding vehicle replacement fiords equal to the annual straight-line
depreciation of all vehicles in the fund.
2. Should Council elect not to fund the straight-line annual
depreciation in the budget, the Deputy City Manager will report on
the short fall in the fund within the budget document.
3. It is recognized that a shortfall currently exists and fully funding
only one year of straight-line depreciation will result in a continued
under -funding of vehicle replacements until the current vehicle
stock is replaced.
E. Information Technology Replacement
i. It is the City Council's goal to maintain reserves in the Information
Technology Replacement fund equal to the accumulated depreciation of
the equipment in the fund.
1. The City Manager's proposed budget will recommend fully
funding the Information Technology Replacement fund equal to
the annual straight-line depreciation of all equipment in the fund.
2. Should Council elect not to fiend the straight-line annual
depreciation in the budget, the Deputy City Manager will report on
the shortfall in the fiord within the budget document.
3. It is recognized that a shortfall currently exists and fully funding
only one year of straight-line depreciation will result in a continued
under funding of Information Technology Equipment replacements
until the current equipment stock is replaced.
F. Other Special Revenue Funds
i. All reserve balances in the following fiend categories are restricted by the
terms of the individual fiends within the fund category:
1. Streets
2. Transportation Development Act
3. Community Development Block Grant
4. Debt Service
12
5. Public Safety Special Revenue
6. General Fund Capital Outlay
7. Parks Capital Outlay
8. Vehicle and Equipment Replacement
10. Enterprise Fund Reserves
Maintaining reserves in the City's Enterprise Funds is also critical to the successful and
stable short- and long-term operations of the City. Adequate reserves in the Enterprise
Funds ensures that the City is able to carry out the purpose of the fund and ensures
compliance with underlying laws and contractual provisions associated with the funds.
Among other metrics, bond rating agencies review compliance with reserve policies in
determining credit ratings.
A. Electric Utility
i. The City Council separately adopts a reserve policy for the Electric Utility
and reviews the components of the policy every three years. As part of the
annual budget process, Council is apprised of the level of reserves desired
under that policy.
B. Water- Utility
i. The City Council has adopted a financial model for the Water Enterprise
that incorporates a reserve target of 25% of Operating Expenses.
ii. Additionally, all funds collected in relation to PCE/TCE rates or
settlements are restricted to use solely for the mitigation and remediation
of those pollutants.
C. Wastewater Utility
The City Council has adopted a financial model for the Wastewater
Enterprise that incorporates a reserve target of 25% of Operating
Expenses.
D. Transit
i. All reserve funds in the Transit Enterprise are restricted as to use solely
for transit purposes.
11. Internal Service Fund Reserves
13
Maintaining reserves in the City's internal Service Funds demonstrates fiscal
accountability and financial prudence. Adequate reserves in the Internal Service Funds
ensure that the City has set aside sufficient fiends to meet the future obligations it has
committed to provide to its employees. Additionally, bond rating agencies review these
funds and look favorably upon entities that are funding the long-term liabilities
represented in the City's Internal Service Funds.
A. Benefits Fund
i. Reserves equal to 25% of the estimated annual cost of all benefits paid for
by this fund.
ii. The Deputy City Manager/Treasurer will invest all reserves in the fund, as
reported in the prior fiscal year's CAFR, in excess of 25% of the estimated
annual cost of all benefits paid in a current fiscal year upon completion of
the prior fiscal year's CAFR.
B. General Liability Insurance and Worker's Compensation Funds
i. Reserves, at a minimum, equal to the 90% confidence level shown in the
annual actuarial report, should be held locally and invested along with the
City's pooled cash portfolio.
ii. Funding at the 90% confidence level will be recommended in each annual
budget.
iii. The Deputy City Manager will review the status of the fiends as of
December 31 each year. If it is estimated that the full budget transfer is
not needed to maintain the 90% confidence level in that year, he/she may
reduce the budgeted transfer for that Fiscal Year for each fund prorated to
each fund's budgeted contribution.
C. Fleet Maintenance Fund
i. Reserves equal to a minimum of 16% of Operating Expenses shall be held
in the Fleet Maintenance Fund.
12. Capital Improvement Plan
The City is committed to ensuring that all of its assets are operated, maintained and
replaced in a manner that is the most prudent method of maintaining the public
stewardship of those assets. To that end, the City will prepare and update annually a
14
Capital Improvement Plan (CIP) that encompasses those assets and looks out over a five-
year lifespan. The first year of the five-year plan will be the current budget year. The
Internal Services Department will be responsible for gathering the data for inclusion in
the plan.
A. CIP Projects
i. Construction projects that are expected to cost $25,000 or more should be
included in the CIP. Projects will be a combination of projects that repair,
replace or enhance existing facilities and infrastructure and projects that
expand or add to the City's existing fixed assets. Vehicles and equipment
(rolling stock) are not to be included in the CIP.
B. CIP Appropriations
Approval of the CIP estimates beyond the current year budget do not
constitute appropriation of the funds necessary or designation of the fiinds
necessary to complete the project. Unspent current year budget
allocations will automatically carryforward until project completion with
the exception of unencumbered budgets in annual maintenance programs
within the CIP. Upon completion of project, unspent budget is returned
to the fund until appropriated by future City Council action. Employee
labor costs do not carry forward.
C. Level of Budget Control
i. Budget control for CIP projects will be at both the general ledger account
level and the CIP project level. Budget allocated to one CIP project
cannot be moved to another project within the CIP or to a non-CIP use
without Council approval. Department Directors may transfer budget
between line items within a project and fund as long as the total
expenditure for the project or for the amount of the funding source specific
to that project does not increase.
D. Elements of the CIP
i. Each project listed in the CIP will address the following items:
• project description
project timeline
• anticipated funding sources
estimated expenditures
15
• revenues and expenditures will be reflected by fiscal year over the
five-year timespan of the CIP
• estimated annual ongoing operating and maintenance costs
13. Encumbrance Accounting
Encumbrances represent commitments to contracts not yet performed and orders not yet
filled. They are used to control expenditure commitments for the year and to enhance cash
management. Encumbrances do not represent expenditures for a period, only a commitment
to expend resources. As a contract is completed, the budgetary encumbrance control
accounts are liquidated or reduced and the actual expenditure is recorded.
A. Lapsing Appropriations
i. All unencumbered fiords lapse at the end of the Fiscal Year with the
exception of Capital Projects fiends. Funds encumbered on contracts will
roll into the next year. The Deputy City Manager shall review all
contracts to determine what encumbered funds shall lapse due to contract
completion.
ii. Capital Projects — appropriated funds in the current fiscal year do not lapse
until project completion or abandonment, whether encumbered or
unencumbered.
14. Pension Stabilization Policy
With the adoption of the Fiscal Year 2020-21 budget this section of the policy was temporarily
suspended for funds in excess of the 16% General Fund fund balance target based on the results of
the Fiscal Year 2019-20 budget. This policy will be reinstated beginning with funds in excess of the
16% General Fund fund balance target based on the Fiscal Year 2020-21 results.
This section replaces the policy adopted by Resolution 2017-219 and amends language and
form for consistency with this policy. The policy is also updated and amended to factor in
UAL funding for UAL costs attributable to positions funded by Measure L.
A. Pension Stabilization Funding
L The Treasurer is authorized to invest all fund balance in excess of 16% in
the General Fund (Pension Stabilization Resources, or PSR), based on the
City's Comprehensive Annual Financial Report (CAFR) from the previous
year in the City's Internal Revenue Code Section l 15 Trust account with
Public Agency Retirement Solutions (PARS); and with Council consent
use PARS trust fiords to make:
16
a. ADP to the Safety Plan of the City of Lodi held by CalPERS; or
b. ADP to the Miscellaneous Plan of the City of Lodi held by
CalPERS;
until such time that the combined Market Value of Assets at the two
CalPERS Plans plus the Market Value of Assets in the PARS fund exceed
80% of the combined "Entry Age Normal Accrued Liability" for both
Safety and Miscellaneous or its most proximate equivalent as calculated by
CaIPERS in the annual Actuarial Reports.
B. Allocation of Pension Stabilization Reserve Funding
i. PSR investments made under this policy shall be accounted for by source
fund and be made from all source finds in equal proportions to the actual
allocation of CalPERS combined normal cost plus UAL cost within the
Fiscal Year of the most recently approved CAFR.
1. The Measure L Fund shall not contribute to the Pension
Stabilization Fund.
ii. The base fund for determining the amount of proportional PSR for other
funds shall be the City's General Fund (Fund 100).
1. If PSR for a particular fund is not adequate to cover the
proportional requirement for that fund, the Treasurer shall prepare
a report and recommendations to City Council to seek direction on
PSR for that Fiscal Year.
iii. Nothing in this policy shall allow the Treasurer to make PSR investments
of any fund to have a projected year end fund balance below thresholds
established in Section 7, 8, 9, 10, or 1 1 of this policy.
1. if proportional PSR investments would cause the projected year
end fund balance of any fund to fall below thresholds established
in the Fiscal Policies, the Treasurer shall prepare a report and
recommendations to City Council within the scope of this policy..
C. Budget Adjustments
i. The City Manager is authorized to make any necessary budget adjustments
to execute this policy in each Fiscal Year based on the calculated PSR.
D. Pension Stabilization Reporting
17
i. The Treasurer shall prepare and present the funded statuses of the City's
combined pension plans in the Annual Budget and the Mid -Year Budget
report.
15. Review and Update
These policies will be in place for the 2019/20 and 2020/21 fiscal years beginning with the
FY 2019/20 budget. These policies will be reviewed and updated every two years in odd
numbered years in conjunction with the approval of the annual budget. The next review
cycle will be in conjunction with the FY 2021/22 budget.
18