(A) General Fund.
(1) The unrestricted (unassigned) fund balance for the General Fund (also known as the Cash Reserve Fund) will be maintained at minimum level equal to 10% of the subsequent fiscal year’s planned expenditures. Should the unrestricted fund balance of the General Fund drop below the above requirement, Administration will notify the City Council and work with the Finance Committee to develop a plan to replenish.
(2) Use and replenishment.
(a) The City of Quincy Cash Reserve Fund can only be committed or spent in the current fiscal year. The conditions warranting the use of the Cash Reserve Fund balance are as follows:
1. To supplement a significant decline in revenues (e.g., state budget reduction, economic downturn, other unavoidable impacts), or
2. To pay for expenses related to a natural disaster or other unforeseen expense, or
3. To defer the cost of borrowing.
(b) Any use of the reserve would require passage of a supplemental budget ordinance, which requires a two-thirds majority vote of City Council. The city would establish a plan at the time of use of funds to replenish the Cash Reserve Fund within three years or as soon as practical.
(3) Unrestricted fund balance above policy requirement. The unrestricted fund balance for the General Fund will be reviewed annually each fiscal year end. In the instance that the General Fund unrestricted fund balance, including the Cash Reserve Fund, exceeds the required reserve of 10% as set forth by this policy, the City Council shall approve using the excess reserves for any of the following:
(a) Reduction in debt/liabilities, or
(b) Infrastructure, or
(c) Other one-time expenses deemed appropriate, or
(d) Carry-over for following year expense.
(B) Water Fund and Sewer Fund (Funds 501 and 502). The Water Fund and Sewer Fund shall each maintain cash reserves equal to three months of budgeted operating expenses plus the amount of one year’s debt service for their respective Fund.
(1980 Code, § 13.1709) (Ord. 9354, passed 11-5-2018)