HomeMy WebLinkAboutRes 1919 - Financial Reserve Policy - Unrestricted Balances of Enterprise Funds (Repealed by Res 2014)City of Tukwil5i
Washington
Cover page to Resolution 1919
The full text of the resolution follows this cover page.
A RESOLUTION OLUTION F' THE CITY ISI UNC L OF TIME CITY OF
TLMMILA, WASHINGTON, HIN GTON, REVISINl THE PREVIOUSLY
ADOPTED FINANCIAL CI L, RE ERVE POLICY T ELIMINATE THE
EFFECTS OF GSI FOR PURPOSIES OFCALCULATING
THE UNRE TI I -TED BAILANCES OFBALANCE' THE ENTERPRI E
FUNDS; AND REPEALING RESOLUTION NO.. 18 61.
Resolution 1919 was amended or repealed by the
following resolutions.
REPEALED
Se tion( ) Repealed Repealed by Res #
2014
City of Tukwila
Washington
Resolution No. / c / c
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
TUKWILA, WASHINGTON, REVISING THE PREVIOUSLY
ADOPTED FINANCIAL RESERVE POLICY TO ELIMINATE THE
EFFECTS OF GASB 68 FOR PURPOSES OF CALCULATING
THE UNRESTRICTED BALANCES OF THE ENTERPRISE
FUNDS; AND REPEALING RESOLUTION NO. 1861.
WHEREAS, for the well-being and sustainability of the community, its residents,
and businesses, it is important that the City of Tukwila be prepared to respond to any and
all situations that could result in a risk and/or crisis to the City's finances including, but not
limited to, revenue shortfalls and unanticipated expenditures; and
WHEREAS, it is the responsibility of the City Council of the City of Tukwila to provide
policy direction for the City's biennial budget through the passage of motions and
ordinances, adoption of resolutions, and final approval of said budget; and
WHEREAS, a financial reserve policy establishes, attains, and restores minimum
fund balances, including self-insured health care reserve funds, and specifies review and
reporting of such; and
WHEREAS, beginning in 2015 the City was required to implement Governmental
Accounting Standards Board Statement 68 (GASB 68) related to accounting and
reporting for pension plans; and
WHEREAS, it is the responsibility of the City to report the effects of GASB 68 in the
Comprehensive Annual Financial Report (CAFR), even though the effects are not a
current liability of the City; and
WHEREAS, the City desires to eliminate the effects of GASB 68 for purposes of
calculating the unrestricted balances of the Enterprise Funds;
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF TUKWILA,
WASHINGTON, HEREBY RESOLVES AS FOLLOWS:
Section 1. Minimum Fund Balances.
A. At the close of each fiscal year, the General Fund unassigned balance shall
equal or exceed 18% and the Contingency Fund reserve balance shall equal or
exceed 10% of the previous year General Fund revenue, exclusive of significant non-
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operating, non-recurring revenues such as real estate sales or transfers in from other
funds.
B. At the close of each fiscal year, the unrestricted balances of the Enterprise
Funds shall equal or exceed 20% of the previous year revenue, exclusive of the
effects of GASB Statement 68, as well as significant non-operating, non-recurring
revenues such as real estate sales, transfers in from other funds or debt proceeds.
C. Use or draw down of minimum balances shall occur only upon
recommendation of City Administration and approval by City Council through a
resolution. Should use or draw down occur, the City Administration shall establish a
plan, no later than the end of the fiscal year following the year of decline, to restore
the fund balance to the prescribed minimum level. The plan shall be presented to
and approved by the City Council.
Section 2. One-time Revenue Reserve. A One-time Revenue Reserve shall be
established and maintained in the Contingency Fund. The One-time Revenue
Reserve shall be credited annually with 10% of the prior year one-time revenues to
the extent General Fund surplus for the year is sufficient to cover the reserve funding.
Use of the reserve shall occur only upon recommendation by City Administration and
approval by City Council through a resolution.
Section 3. Self-insured Health Care Funds. The City shall maintain a reserve in
each of its self-insured health care funds in an amount equal to 1.5 times, or 150%, of
the actuarially determined IBNR (incurred but not reported) balance. Use of the
reserve shall occur only upon recommendation by City Administration and approval by
City Council through a resolution.
Section 4. A report showing compliance with the Financial Reserve Policy shall
be provided to the City Council on an annual basis, no later than July 1 of each year.
Section 5. Repealer. Resolution No. 1861 is hereby repealed.
PASSED BY THE CITY COUNCIL OF THE CITY OF TUKWILA, WASHINGTON,
ata Regular Meeting thereof this day of M rA V ,f , 2017.
ATTEST/AUTHENTICATED:
Christy O'Flahe
APPROVED AS TO FORM BY:
Rachel B. Turpin, City Attorney
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Dennis Roto , Council President
Filed with the City Clerk: 1- i_5 l J7
Passed by the City Council: 1')
Resolution Number: 1 OI I cl
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