Fort Walton Beach Council agenda — 8-11-14--proposed budget — reading text

limitations imposed by creditors, grantors, laws, regulations, or enabling legislation. Unrestricted 3. Committed ( self imposed - limitations) —resources whose use is constrained by limitations that the governing body has imposed and remains binding until removed in the same manner. Disaster/ Emergency Reserve — City Council established a committed fund balance of 30% of annual budgeted expenditures per Resolution 2011 - 13 adopted August 16, 2011. This equates to $ 5. 6M in the current year budget. 4. Assigned ( limitation resulting from intended use) — resources whose use is constrained by a body or official designated by the governing body. Subsequent Year' s Budget —City Council authorizes City management to set forth in the annual budget ( and any amendments thereto) fund balance for specific purposes per Resolution 2011 - 13 adopted August 16, 2011. 5. Unassigned ( residual net assets not otherwise classified) —total fund balance in excess of the nonspendable, restricted, committed, and assigned fund balances ( e. g. surplus). There is currently $720K.. Cuy of Fon Walton Bench. FL Budget Overview Changes in Fund Balance Very minimal changes in reserves are anticipated, as displayed below, primarily due to the purchase of an SUV and a master plan for the Landing Park in the CRA. Actual Budget Variance FY13 to FY14 FY 2013 FY 2014 FY 2015 General Fund 10, 058, 860 15,582, 575 15. 582. 575 SO 0.0% Law Enf. Trust Fund 268, 070 S255. 285 242. 500 12. 785 5. 0% Law Enf. Training Fund 11, 188 59. 698 8.208 1. 490 15.4% FBC Fund 183, 117 58, 042 55. 712 13, 754 0.0% CDBG Fund 52. 745 0 0 0 0.0% CRA Fund 2. 035. 225 2, 035, 225 2. 016.842 18, 383 0. 9% Debt Service Fund 21. 156 21. 156 521, 156 0 0. 0% Beal Memorial Fund 2. 516. 011 2, 575. 011 2, 634,011 59, 000 2. 3% WorkingWorking CapitalCapital ( ( proprietaryproprietary funds)funds) WorkingWorking capitalcapital refersrefers toto thethe differencedifference betweenbetween currentcurrent assetsassets andand currentcurrent liabilities liabilities reportedreported inin aa proprietaryproprietary fund.fund. ThisThis measuremeasure indicatesindicates relativerelative liquidity.liquidity. CreditCredit ratingrating agencies agencies considerconsider thethe availabilityavailability ofof workingworking capitalcapital inin theirtheir evaluationsevaluations ofof aa locallocal government'government' ss creditworthiness.creditworthiness. WorkingWorking capitalcapital isis alsoalso importantimportant inin mitigatingmitigating unanticipated unanticipated eventsevents andand ensuringensuring stablestable servicesservices andand fees.fees. TheThe City'City' ss targettarget levellevel ofof workingworking capitalcapital isis 9090 daysdays ofof annualannual operatingoperating expenses,expenses, andand currently currently exceedsexceeds thisthis levellevel forfor allall funds.funds. ItIt isis notnot feasiblefeasible toto projectproject thisthis measuremeasure intointo thethe future.future. ActualActual FYFY 20112011 FYFY 20122012 FYFY 20132013 UtilitiesUtilities FundFund 163163 297297 270270 SanitationSanitation FundFund 228228 226226 253253 StormwaterStormwater FundFund 425425 353353 337337 NetNet AssetsAssets ( ( proprietaryproprietary funds)funds) NetNet assetsassets refersrefers toto thethe differencedifference betweenbetween assetsassets andand liabilitiesliabilities reportedreported inin aa proprietaryproprietary fund,fund, andand maymay bebe considered considered aa measuremeasure ofof netnet worth.worth. ThereThere areare twotwo typestypes ofof netnet assets:assets: CityCity ofof FortFort wahonwahon Beach.Beach. FLFL Budget Overview 1. Restricted —funds committed for identified purposes or legally required to be segregated; not available to liquidate liabilities of the current period ( e. g. debt service, impact fees). 2. Unrestricted — funds not required to be on hand and have not been identified for a particular purpose; available for capital projects or to balance the budget; the measure of financial health for an enterprise fund. City Council established that unrestricted net assets will be maintained at 33% of operating, debt service, and transfers out per Resolution 2011 - 13 adopted August 16, 2011. The City currently meets this policy for all funds. The rate study is currently underway for the Utility Fund to address the future policy of this Fund. Actual Estimate FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 Utilities Fund 43. 2% 74. 4% 42. 5% 34. 5% 15. 3% Sanitation Fund 61. 1% 59. 3% 64. 0% 62. 9% 64. 1% Stormwater Fund 113. 7% 94. 3% 83. 6% 89. 5% 83. 9% InvestmentsInvestments InvestmentInvestment PhilosophyPhilosophy — — FundsFunds shallshall bebe investedinvested inin aa mannermanner thatthat willwill ensureensure thethe safetysafety ofof principalprincipal whilewhile meetingmeeting dailydaily cashcash flowflow needs.needs. OptimizationOptimization ofof investmentinvestment incomeincome shallshall bebe secondarysecondary toto thethe requirementsrequirements ofof safetysafety andand liquidity.liquidity. InvestmentInvestment PolicyPolicy — — OrdinanceOrdinance 1875,1875, adoptedadopted byby CityCity CouncilCouncil inin JanuaryJanuary 2013,2013, governsgoverns thethe investmentinvestment ofof fundsfunds inin excessexcess ofof thosethose requiredrequired toto meetmeet currentcurrent expenses,expenses, withwith thethe exceptionexception ofof pensionpension funds,funds, fundsfunds relatedrelated toto thethe issuanceissuance ofof debtdebt wherewhere therethere areare otherother existingexisting policiespolicies oror indenturesindentures inin effecteffect forfor suchsuch funds,funds, andand BealBeal MemorialMemorial CemeteryCemetery PerpetualPerpetual CareCare funds.funds. InIn aa nutshell:nutshell: TheThe primaryprimary investment investment objectives,objectives, inin orderorder ofof importance,importance, are:are: safetysafety ofof principal,principal, liquidity,liquidity, andand investmentinvestment income.income. CashCash balancesbalances fromfrom allall fundsfunds areare consolidatedconsolidated toto maximizemaximize investmentinvestment earnings.earnings. InvestmentInvestment incomeincome isis allocatedallocated toto eacheach fundfund basedbased onon thethe fund'fund' ss respectiverespective participationparticipation andand inin accordanceaccordance withwith generallygenerally acceptedaccepted accountingaccounting principles.principles. TheThe investmentinvestment portfolioportfolio shallshall bebe structured,structured, toto thethe extentextent possible,possible, toto matchmatch investmentinvestment maturitiesmaturities withwith knownknown cashcash needsneeds andand anticipatedanticipated cashcash flowflow requirements.requirements. InvestmentsInvestments willwill bebe diversified,diversified, toto thethe extentextent practicable,practicable, toto controlcontrol thethe riskrisk ofof lossloss resultingresulting fromfrom overover- - concentrationconcentration ofof assetsassets inin aa specificspecific maturity,maturity, issuer,issuer, instrument,instrument, dealer,dealer, oror institution.institution. EachEach portfolio'portfolio' ss performance performance willwill bebe reviewedreviewed onon aa quarterlyquarterly basis,basis, withwith emphasisemphasis placedplaced onon resultsresults achievedachieved overover aa rollingrolling timetime periodperiod ofof threethree toto fivefive yearsyears forfor longlo- ng - termterm portfolios.portfolios. ObjectivesObjectives willwill bebe reviewedreviewed annuallyannually andand adjustedadjusted asas necessarynecessary afterafter consultationconsultation withwith thethe FinanceFinance Director,Director, InvestmentInvestment Advisor(Advisor( s),s), andand PortfolioPortfolio Manager(Manager( s).s). OverOver thethe pastpast year,year, thethe CityCity transitioned transitioned fromfrom aa short-short- termterm internally-internally- managedmanaged portfolioportfolio ofof certificatescertificates ofof deposit,deposit, moneymoney marketmarket funds,funds, andand bankbank accountsaccounts toto twotwo externally-externally- managedmanaged portfolios:portfolios: shortshort - - to-to- mediummedium termterm ( ( PFMPFM AssetAsset Management)Management) andand mediummedium - - toto- - longlong termterm ( ( MorganMorgan StanleyStanley SmithSmith