HomeMy WebLinkAboutItem 09.dDate September 7, 2010
Proposed Action
Overview
Primary Issues to Consider
DennisiFeIler, Finance Director
RESOLUTION AMENDING THE 2010 BUDGET
Item No.
Staff recommends adoption of the following motion: Move to approve The Resolution
Amending the 2010 Budget.
Approval of the motion will authorize the transfer of $2.8 million from the General Fund to other
funds.
At the June 2010 work session, staff proposed a transfer of $2.8 million from the General Fund
fund balance to various other funds to finance major maintenance projects, reduce debt and
reduce tax increases for the next three years. The proposed General Fund transfer is as follows:
Fund Total
Trail Maintenence Fund $ 1,400,000
Equipment Fund 1,100,000
Building Fund 52,136
G.O. Improvement Refunding Bonds Series 2007 107,490
Pavement Management Fund 140,374
Total $ 2,800,000
• What is the purpose of the respective transfers?
• What is the outcome if transfers are not made?
Supporting Information
• Proposed 2011 and Estimated 2012 Budget.
See attached
See attached
Financial Impact $ 2,800,000 Budgeted: Refer to Proposed 2011 Budget Source:General Fund
Related Documents (CIP, ERP, etc.):
Notes:
What is the purpose of the respective transfers?
Primary Issues to Consider
• As the trail system ages, the cost of maintenance will increase proportionally.
Historically, the costs have been accounted for in the General Fund and financed with
tax levies. However, in order to reduce the adverse impacts of 'fluctuating annual
maintenance costs, the Capital Improvement Plan segregates the program into a "Trail
Maintenance Fund" similar in structure to the "Pavement Management Fund ". The
initial costs will be financed with a $ 1.4 million transfer from the General Fund.
Approval of the transfer reduces the need for a tax levy to finance trails maintenance for
at least 3 years or more.
• A transfer of $1.1 million is proposed to the Equipment Fund to augment other revenue
sources (such as transfers from the Liquor Fund, ALF rebates and investment earnings)
and short term debt financing thereby reducing the future tax levies.
• A transfer of $140,370 to the Pavement Management Fund to finance the repairs to the
Fire Station #3 parking lot, the turn lanes on Holyoke Ave at 210 Street and the seal
coating of park parking lots in 2011 and 2012. In the absence of the transfer the projects
would need to be financed with General Fund tax levies.
• A transfer of $107,490 is proposed to the G.O. Improvement Refunding Bonds series
2007 to finance the 2011 and 2012 tax levies. Approval of the transfer reduces the tax
levy requirement accordingly.
• A transfer of $52,136 to the Building Fund to finance major maintenance projects of
City facilities as shown in the 2011- 2015 Capital Improvement Plan.
What is the outcome if transfers are not made?
The Proposed 2011 and Estimated 2012 Budget was premised on the objective of establishing a
financial structure which results in (a) no tax increase for 2011 (b) nominal tax increases for
operations for the foreseeable future. The proposed transfers provide the framework to achieve
the objective.
If the City Council chooses not to approve the transfer, the projects to be financed with these
transferred funds would need to be financed with additional debt (and repaid with future tax
levies) or be cancelled.
CITY OF LAKEVILLE
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Lakeville that a
transfer of $2,800,000 is hereby approved from the General Fund to the following funds as stated
below:
ATTEST:
RESOLUTION NO.
RESOLUTION AMENDING THE 2010 BUDGET
Fund Total
Trail Maintenence Fund $ 1,400,000
Equipment Fund 1,100,000
Building Fund 52,136
G.O. Improvement Refunding Bonds Series 2007 107,490
Pavement Management Fund 140,374
Charlene Friedges, City Clerk
Total $ 2,800,000
DATED this 7 day of September 2010.
CITY OF LAKEVILLE
Holly Dahl, Mayor