REPORT TO THE CITY COUNCIL
DATE: May 14, 2015
FROM: BRUCE RUDD, City Manager
City Manager's Office
BY: MICHAEL LIMA, Finance Director/Controller
Finance Department
SUBJECT:
Title
***RESOLUTION - Enacting changes to the Reserve Management Act
Body
RECOMMENDATION
It is recommended that City Council approve the attached resolution and legislation, which makes several changes to the Reserve Management Act (RMA).
EXECUTIVE SUMMARY
The RMA was adopted by City Council on March 31, 2011. The RMA established several reserve funds for the City's operations, specified the levels at which those reserves would be funded, and articulated the ways those reserves could be utilized. As the RMA has been implemented, management has noted several ways in which the RMA could be refined to enhance operational utilization, while maintaining the strong controls that were inherent in the original RMA. The proposed revisions will accomplish that goal.
BACKGROUND
In the absence of formal reserve policies, Council adopted the RMA on March 31, 2011. The RMA required the City to establish several reserve funds, including two for the General Fund (the Committed General Cash Reserve for Economic Uncertainties and the Committed General Cash Reserve for Contingency Stabilization). The RMA also specified the levels at which those reserve funds would be funded, and the ways in which those reserves could be used.
As the RMA was adopted during a time when the City was suffering through financial difficulties, the City was not able to provide the resources needed to fund the various reserve funds specified in the RMA. With the City's financial condition improving, it has now become possible to utilize the RMA's requirements and structures. However, as management and staff have implemented the RMA's provisions, it has become clear that the RMA should be refined to enhance operational utilization, while still maintaining the controls that were t...
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