(A) General Fund. The unrestricted fund balance of the General Fund shall be maintained at a level amounting to no less than two months, nor more than four months, of the current fiscal year budgeted General Fund revenues, exclusive of federal, state or county grant funds. Use of the minimum unrestricted fund balance shall be authorized only when emergency expenditures or an unexpected revenue reduction, including, but not limited to, unanticipated operating expenses, major equipment repairs, weather related damages or unanticipated legal expenses, or to off-set unanticipated decreases in revenues, such as national recessions or delays in distribution of state revenue designated for local governments would cause the General Fund budget to end the fiscal year with a negative balance. The amending of the budget to utilize the unrestricted fund balance shall require approval of an ordinance by a two-thirds vote of the members. The fund balance shall be restored to its required level in the following fiscal year.
(B) Sewer funds. There shall be three sewer funds. Fund balance levels for each fund are set forth below. The amending of the budget to utilize an unrestricted fund balance shall require approval of an ordinance by a two-thirds vote of the Trustees. The fund balance shall be restored to its required level in the following fiscal year.
(1) Sewer Operations and Maintenance Fund. The fund balance shall be maintained at a level of 25% of the utility’s annual operations and maintenance expenses. The fund may be used for emergency repairs or purchases or working capital needs. The amending of the budget to utilize the unrestricted fund balance shall require approval of an ordinance by a two-thirds vote of the members. The fund is an unrestricted net assets fund.
(2) Sewer Capital Replacement and Improvement Fund. The fund is established to provide sufficient reserves for future major capital replacement and capital improvement expenses for a period of one to five years. The fund balance shall be maintained at a level equaling the total estimated cost of the next five years’ capital improvement expenses and shall include the amounts annually required in the next year to make such payments on any outstanding loans as established by the loan agreements. The fund is a restricted net assets fund.
(3) Sewer Reserve Fund. The fund is established to provide sufficient reserves to maintain its service level during potential short-term cash flow interruptions caused by an unusually high number of customer delinquencies or other unanticipated revenue shortfalls. The fund balance shall be maintained at 5% of the utility’s current year projected rate revenues. The fund is an unrestricted net assets fund.
(Prior Code, § 2-604) (Ord. 1609, passed 4-18-2011)