CITY COUNCIL: Resolution Approving Transfet of 2009/08 General Fund Surplus to Capital Projects Reserve Fund

Meeting Date: January 6, 2009
Prepared by: Joyce Giuffre,
Admin Services Director

City Council
Agenda Item Summary

Name: Consideration of a Resolution to approve the transfer of the fiscal year 2007/08 General Fund surplus of $346,841 to the Capital Projects Reserve Fund.

Description: The City’s audited financial statements results for the year ended June 30, 2008, show a General Fund surplus of revenues over expenditures of $346,841
(see Exhibit “A”).

Overall Cost: N/A

Staff Recommendation: Adopt the Resolution approving the transfer of $346,841 from the General Fund to the Capital Projects Reserve Fund. The current balance of the Capital Projects Reserve is $2,822,700. The balance will increase to $3,169,541 if this Resolution is approved by the City Council.

Important Considerations: The City has future capital needs that can be funded from the Capital Projects Reserve Fund. Therefore, this reserve should be adequately funded and maintained.

Decision Record: Resolution 2008-8, dated January 8, 2008, approving $772,443 from the FY 2006/07 surplus to be transferred from the General Fund to the Capital Projects Reserve Fund.

Reviewed by:

______________________________ _________________
Rich Guillen, City Administrator Date

CITY OF CARMEL-BY-THE-SEA
STAFF REPORT
TO: MAYOR McCLOUD AND COUNCIL MEMBERS
FROM: JOYCE GIUFFRE, ADMISTRATIVE SERVICES DIRECTOR
DATE: JANUARY 6, 2009
SUBJECT: CONSIDERATION OF A RESOLUTION TO APPROVE THE TRANSFER OF THE FISCAL YEAR 2007/08 GENERAL FUND SURPLUS OF $346,841 TO THE CAPITAL PROJECTS RESERVE

RECOMMENDED MOTION
Staff recommends that the City Council approve the Resolution.

BACKGROUND
The City’s audited financial statements for the year ended June 30, 2008, show a General Fund surplus of revenues over expenditures of $346,841 (see Exhibit “A”). When there is a surplus, the City Council may decide to either leave the surplus in the General Fund or transfer the surplus to a reserve fund.

The following summarizes General Fund surpluses and the action approved by the City Council in the past three years:
General Fund Amount
Fiscal Year Surplus Transf/Alloc Transf/Alloc To
2006/07 $1,904,018 $ 772,443 Capital Project Reserve
677,279 Debt Reduction Reserve
131,575 Public safety equipment
322,721 Pay off Westamerica notes & leases
2005/06 636,273 636,273 Capital Project Reserve
2004/08 86,412 86,412 Capital Project Reserve

STAFF REVIEW
The Capital Projects Reserve Fund should be replenished for the following reasons:
• In FY 2007/08, actual transfers from the Capital Project Reserve to the General Fund totaled nearly $80,000. If the City had known that fiscal year results would show a General Fund surplus, the transfers from the Capital Project Reserve may not have taken place. Therefore, it is prudent to return funds to the Capital Project Reserve.

• The current FY 2008/09 budget includes a transfer of $275,000 from the Capital Projects Reserve to the General Fund. This transfer covers a portion of the current year’s capital projects. Transferring the FY 2007/08 General Fund surplus to the Capital Projects Reserve will cover the current year’s $275,000 transfer and will result in additional funds available for future capital projects, if needed.

FISCAL IMPACT
The current balance of the Capital Projects Reserve is $2,822,700. The balance will increase to $3,169,541 if this Resolution is approved by the City Council.

SUMMARY
Staff requests approval to transfer the FY 2007/08 General Fund surplus of $346,841 to the Capital Projects Reserve. By replenishing the Capital Projects Reserve, the City will have adequate funds for the FY 2008/09 capital projects as well as for such projects in future years.

CITY COUNCIL
CITY OF CARMEL-BY-THE-SEA
RESOLUTION 2009-
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CARMEL-BY-THE-SEA AUTHORIZING THE TRANSFER OF THE FISCAL YEAR 2007/08 GENERAL FUND SURPLUS OF $346,841 TO THE CAPITAL PROJECTS RESERVE FUND

WHEREAS, the City’s audited financial statements for the year ended June 30, 2008 show a General Fund surplus of revenues over expenditures of $346,841; and

WHEREAS, it is recommended that any General Fund surplus be transferred to reserve accounts; and

WHEREAS, transfers from the Capital Projects Reserve Fund to the General Fund totaled $79,629 for capital projects in FY 2007/08; and

WHEREAS, the current balance of the Capital Projects Reserve Fund is $2,822,700; and

WHEREAS, the Capital Projects Reserve Fund should be replenished for future capital projects.

NOW, THEREFORE, BE IT RESOLVED THAT THE CITY COUNCIL OF THE CITY OF CARMEL-BY-THE-SEA DOES:

1. Approve the transfer of the fiscal year 2007/08 General Fund surplus of $346,841 to the Capital Projects Reserve Fund.

PASSED AND ADOPTED BY THE CITY COUNCIL OF THE CITY OF CARMEL-BY-THE-SEA this 6th day of January 2009, by the following roll call vote:

AYES: COUNCIL MEMBERS:
NOES: COUNCIL MEMBERS:
ABSENT: COUNCIL MEMBERS:

SIGNED,

_______________________________
Heidi Burch, City Clerk


________________________
ATTEST, SUE McCLOUD, MAYOR