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Home My WebLink About028176 RES - 05/19/2009RESOLUTION AMENDING FINANCIAL POLICIES ADOPTED BY RESOLUTION 027683 AND PROVIDING FINANCIAL POLICY DIRECTION ON PREPARATION OF THE FY 2009-10 BUDGET. WHEREAS, the City of Corpus Christi has a commitment to citizens as expressed in its Mission Statement: Provide exceptional service to enhance the quality of life.-"; and WHEREAS, financial resources are budgeted to fulfill this commitment; and WHEREAS, it has been the City's goal to rebuild the General Fund balance to acceptable levels, a goal which was expressly stated in past policies with targets for accomplishing that goal; and WHEREAS, the City Council adopted a Financial Policy in January 1997 by Resolution No. 022828, reaffirmed the Financial Policy in June 1997 by Resolution No. 022965, modified the Financial Policy in July 1997 by Resolution No. 022992, adopted a new Financial Policy in May 1998 by Resolution No. 023319; reaffirmed the Financial Policy in May 1999 by Resolution No. 023657; reaffirmed the Financial Policy in May 2000 by Resolution No. 024044; reaffirmed the Financial Policy in May 2001 by Resolution No. 024455; reaffirmed the Financial Policy in May 2002 by Resolution No. 024863; reaffirmed the Financial Policy in April 2003 by Resolution No. 025280; reaffirmed the Financial Policy in April 2004 by Resolution No. 025737; and reaffirmed the Financial Policy in May 2005 by Resolution 026265; and reaffirmed the Financial Policy in January 2006 by Resolution 026605• and amended the Financial Policy in April 2008 by Resolution 027683; WHEREAS, as a result of those policies, the City has achieved its goal for the General Fund balance and desires now to articulate a strategy to maintain that balance and to utilize any surplus balance to provide for enhanced financial stability in future years; and WHEREAS, this policy provides an essential guide to direct financial planning and to maintain and strengthen the City's bond rating; and WHEREAS, it has been the City's practice to reaffirm its financial policy or to adopt new or modified policy annually in conjunction with preparation of the budget. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF CORPUS CHRISTI, TEXAS: H:\LEG-DIR\Lisa\2009 Resolutions12009-10 Budget Policy Resolution.do •.e u... 028176 '2 1 The Financial Polices adopted by Resolution 026605027683 are amended to read as follows: "Section 1. Development/Effective Date of Financial Policy. This Financial Policy reaffirms and amends the financial policies adopted by each year by the City Council since 1997. This Financial Policy is made part of the City Comprehensive Policy Manual. The City Manager is directed to prepare the FY 2008 09 FY 2009-10 proposed budget in accordance with this policy. The City Council is prepared to make expenditure reductions that may be necessary to comply with this policy. "Section 2. Current Revenues Equal/Exceed Current Expenditures. Current General Fund operating revenues will equal or exceed current budgeted expenditures. "Section 3. Fund Balance Reserve/Working Capital. To ensure that current and future services or operations are not severely impacted by any economic slowdowns, emergencies, natural disasters or other unforeseen circumstances, adequate financial resources will be set aside in the General Fund unreserved fund balance. Accordingly it is the goal of the City Council to build and maintain a reserve in the General Fund unreserved fund balance which totals at least ten (10%) percent of total annual General Fund appropriations. The City Manager shall report on the status of compliance with this ten (10%) percent policy at least annually as part of the budget process. Undesignated fund balance in excess of the ten percent policy requirement may be recommended for expenditure on one-time improvements, with a priority on infrastructure and equipment which will reduce the need for future debt. Such expenditures shall be subject to the normal appropriations and expenditure approval process applicable to all other funds. Finally, it is noted that extraordinary situations may arise in which the timing of external actions out of the City's control may require the use of the funds in the reserve. The City Manager shall note these situations to the City Council as soon as the information is known. "Section 4. Property Tax Rate for Operations and Maintenance. The Proposed Budget for FY 2008-09 2009-10 shall be prepared assuming that the City will be adopting a tax rate necessary to be in compliance with Section 2 above. Full consideration will be given to maintaining the "effective tax rate" for maintenance and operations. "Section 5. Priority of City Services. The City Council recognizes the need to provide public services which support the continued growth of the local economy and personal income growth to insure an adequate financial base for the future. Priority for are reflected in Attachment A. Every effort will be made to accomplish these goal„ "Section 6. Operating Contingencies. The City Manager is directed to budget at least $200,000 per year as an operating contingency as part of General Fund H:\LEG-DIR\Lisa\2009 Resolutions\2009-10 Budget Policy Resolution.do 3 expenditures in order to further insulate the General Fund unreserved fund balance from unforeseen circumstances. The City Manager is directed to budget similar operating contingencies as expenditures in enterprise, internal service and special revenue funds of the City. "Section 7. Multi -Year Financial Forecasting. The City will maintain a five-year financial plan for the General Fund to anticipate potential budget imbalances and unfavorable revenue or expenditure trends, thus allowing for the identification of budgetary gaps long before they develop into fiscal crises. Whereas many of the City's fiscal goals require commitment and discipline beyond the one year considered within the City's fiscal year, the City will also consider adoption of action plans necessary for the accomplishment of City short term or long term goals. These action plans will be presented and recommended to the City Council in the proposed annual operating budget and shall be used for development of future budget recommendations as necessary to accomplish these goals. The City shall also maintain business plans and/or rate models for enterprise operations. "Section 8. Revenue Enhancement. The City shall attempt to pursue and maintain a diversified and stable revenue stream for the General Fund in order to shelter finances from short term fluctuations in any one revenue source. In order to meet the requirements outlined in Sections 2 and 4, every effort will be made to base rates on a cost of service model so costs incurred for certain services are paid by the population benefiting from such services. "Section 9. Quarterly Financial Reporting and Monitoring. The City Manager shall provide interim financial performance reports and updates to the City Council on a quarterly basis. These interim reports must include detailed year to date revenue and expenditure estimates, as well as explanations for major variances to budget. The format of the quarterly report must be relatively consistent with the adopted budget. "Section 10. Use of Nonrecurring Revenue. The City shall endeavor to use nonrecurring revenue to fund one-time expenditures. Nonrecurring revenue may include items such as sale of fixed assets, court settlements, or revenue collection windfalls. "Section 11. Debt Management. The City Manager shall adhere to the Debt Management Policy adopted by Resolution 027526 028003 adopted by the City Council on December 11, 2007 December 16, 2008. "-Section 12. Capital Improvement Plans/Funding. The annual Capital Improvement Plan shall follow the same cycle as the Operating Budget. As part of the annual capital budget process, the City shall update its short and long range capital improvement plans. For the three-year short term plan, projects include any projected incremental operating costs for programmed facilities. The long range plan extends for an additional seven years, for a complete plan that includes ten years. Short-term plan projects must H\LEG-DIR\Lisa\2009 Resolutions\2009-10 Budget Policy Resolution.do 4 be fully funded, with corresponding resources identified. As part of a concerted effort to reduce debt levels and improve financial flexibility, the City shall pursue pay-as-you-go capital funding where possible. "Section 13. Expenditures. Within the limitation of public service needs, statutory requirements and contractual commitments expenditures included in the operating budget shall represent the most cost efficient method to deliver services to the citizens of Corpus Christi. Efforts to identify the most cost efficient method of service delivery shall continue during the fiscal year after the operating budget is adopted and may be implemented during the fiscal year as necessary and of benefit to the public." ATTES . THE CITY OF CORPUS CHRISTI Armando Chapa City Secretary APPROVED: )YLLC- I Z 2009. Lisa Aguilar Assistant City Attorney for City Attorney JoeGdame �� Mayor H:\LEG-DIR\Lisa\2009 Resolutions ‘2009-10 Budget Policy Resolution.do ATTACHMENT A City Council Short Tcrm Coals 4.Improve the Development Proce^s by adoption of a clear and consistent Unified Development Code and implementing procece improvements to make it more efficient and ev c ivic 5.Develop a plan for Texas A&M University Corpus Christi Expansion. 6.Complete the updating procecf on the City's Master Plan utility elements (water, 7.Increace the effectiveness and efficiency in Code Enforcement. O Review 4he Crity charter 10. Develop a downtown plan. City Council Long Tcrm Coals greenspaces)= friendly bucinecc. 6.Ensure and protect long term water supply for the region. H:\LEG-DIR\Lisa\2009 Resolutions\2009-10 Budget Policy Resolution.do H:\LEG-DIR\Lisa\2009 Resolutions\2009-10 Budget Policy Resolution.do Corpus Christi, Texas /0 of / , 2009 The above resolution was passed by the follow] ° g vote: Joe Adame Chris N. Adler Brent Chesney Larry Elizondo, Sr. Kevin Kieschnick Priscilla G. Leal John E. Marez Nelda Martinez Mark Scott 02817E