The Village hereby adopts the following Fund Balance Policy:
Fund Balance is divided into five classifications based primarily on the extent to which the Village must observe constraints imposed upon the use of its governmental-fund resources The classifications are as follows:
(a) Nonspendable: The Village shall classify assets as nonspendable when legally or contractually required to maintain the amounts intact.
(b) Restricted: Fund balance is restricted when constraints placed on the use of resources are either externally imposed by creditors (such as through debt covenants), grantors, contributors, or laws or regulations of other governments; or is imposed by law through constitutional provisions.
(c) Committed: Council can commit amounts via formal action (resolution). The Village must adhere to these commitments unless the Council amends the resolution. Committed fund balance also incorporates contractual obligations to the extent that existing resources in the fund have been specifically committed to satisfy contractual requirements.
(d) Assigned: Assigned fund balances are intended for specific purposes but do not meet the criteria to be classified as restricted or committed. Governmental funds other than the general fund report all fund balances as assigned unless they are restricted or committed. In the general fund, assigned amounts represent intended uses established by Village Council or a Village official delegated that authority by resolution, or by State Statute.
(e) Unassigned: Unassigned fund balance is the residual classification for the general fund and includes amount not included in the other classifications. In other governmental funds, the unassigned classification is used only to report a deficit balance. (Ord. 2015-49. Passed 12-17-15.)