TITLE
HOLD a public hearing and consider an ordinance amending the FY 2018 Annual Budget and Plan of Municipal Services of the City of Killeen to adjust revenue and expenditure accounts in multiple operating, special revenue, internal service, and capital improvement project funds.
SUMMARY
DATE: August 21, 2018
TO: Ronald L. Olson, City Manager
FROM: Jonathan Locke, Executive Director of Finance
SUBJECT: Year-end Budget Amendment
BACKGROUND AND FINDINGS:
City Council adopted the Financial Governance Policies on December 19, 2017. Section ten of the document establishes guidelines for reserve fund balances. In order to mitigate financial risk that may arise from unforeseen revenue fluctuations, significant unanticipated expenses, and natural disasters, the City requires that major operating funds maintain an unassigned fund balance reserve between 18% and 22% of operating expenditures. The policy states that fund balance in excess of 22% must be used for capital projects or programs.
In March 2018, Belt, Harris, Pechacek presented the FY 2017 audit results to City Council. The audited financial statements were used to calculate the estimated amount of unreserved fund balance that will exceed 22% of proposed FY 2019 operating expenditures. This budget amendment will move the calculated amounts to the respective capital improvement fund.
In addition, the budget amendment will provide budgets for operational needs identified by departments and Finance. This includes transferring budgets within the General Fund, which will not increase overall appropriations, as well as increase expenditure budgets in the Solid Waste Fund, multiple special revenue funds, internal service funds, and capital improvement project funds.
THE ALTERNATIVES CONSIDERED:
Three alternatives were considered: 1) Amend the budget to address the identified needs; 2) Do not amend the budget; and 3) Amend the budget for a portion of the identified needs.
Which alternati...
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