| | | | | | | | | 
City Council Agenda Request
February 27, 2018
| |
| | | | | | | |
AGENDA REQUEST NO: I.C.
|
| | AGENDA OF: City Council Meeting |
| | INITIATED BY: Jennifer Brown, Director of Finance |
| | PRESENTED BY: Jennifer Brown, Director of Finance |
| | RESPONSIBLE DEPARTMENT: Finance |
|
| | | | | | | | | AGENDA CAPTION: | | Review of and discussion on proposed revisions to Financial Management Policy Statements. |
|
| | | | | | | | | RECOMMENDED ACTION: | | Review of and discussion of proposed revisions to Financial Management Policy Statements. |
|
| | | | | | | | | EXECUTIVE SUMMARY: | Background
The resiliency and stability of the City's finances are a significant asset to the community. This stability comes from having a set of financial policies that are designed to provide staff with the guidance necessary to manage the City's finances effectively and maximize the predictability of the plan. Through utilization of the Financial Management Policy Statements (FMPS) – first adopted in 2002, the City has achieved the second lowest tax rate for cities our size and maintained a AAA bond rating since 2011. This allows the City to borrow at a lower cost, thereby implementing more projects with less of an impact to the tax bill.
Bi-annual review, update and adoption of the FMPS provides guidance and direction to staff in the management of the City's finances. This planned periodic review allows the policy direction to be adjusted as needed and adapts the direction of the City's financial management to reflect the intent of the City Council. The FMPS are the guiding structure that staff uses to develop financial strategies such as the annual budget, long-range financial and capital planning. Additionally, bond rating agencies utilize the FMPS to gauge the sustainability of the City's finances and evaluate the risks to current and potential bondholders that their investment will be repaid timely. The rating agencies frequently cite the FMPS in evaluating the City's financial management during these reviews.
One of the highest priority Strategic Projects for FY2018 is the review and update of the FMPS. At the fall retreat, the City Council requested to be fully engaged on the proposed changes and for the project to be reviewed with the entire City Council rather than utilizing the Finance/Audit Committee to review as has been used for past updates.
2018 Review & Update
As part of the 2018 review of the FMPS, Finance staff has reviewed the most current FMPS, as adopted in June 2016 via Resolution 16-20, and drafted recommended revisions for most areas, as well as identifying areas where direction from City Council is needed.
As discussed in the February 6th workshop, the original concept for the FMPS is that they are a living document, changing with the City as it grows giving an opportunity for all City Councils to provide input and direction on how the City’s finances should be managed to best meet the needs of the City at the time. Since 2002, when the first set of statements was adopted, the City has consistently implemented that concept through bi-annual review and revisions to the FMPS. During the workshop, staff proposed a series of workshops to review key areas of the FMPS that need input or direction from City Council - recognizing that most of the proposed revisions are fairly mundane and will not need significant discussion.
The purpose of this workshop is to walk through the current policy statements and the proposed revisions, identifying areas where input from City Council is needed.
Following this workshop and based on feedback from City Council, staff envisions a series of at least two workshops - with at least two weeks in between - to discuss the budget development process and assumptions for FY19. The first workshop would focus primarily on the relationship between property taxes and the Debt Service Fund and CIP, while the second session would be focused on the General Fund and O&M assumptions – including the relationship between property taxes and the City’s compensation philosophy, recognizing that the largest portion of expenditures in the General Fund is personnel. Additional discussion, if needed, on the substantive items could take place at the regularly scheduled March workshop.
The goal is to have an agreed upon set of budget and CIP assumptions by the end of March to stay on schedule with the budget preparation calendar. Additional discussion on technical revisions not related to the budget process can continue beyond the end of March. Staff will then take the feedback from City Council and incorporate any changes into the revised FMPS that will be brought back to the City Council for adoption by Resolution.
|
|
| | | | | | | |
| BUDGET |
| | EXPENDITURE REQUIRED: N/A |
| | CURRENT BUDGET: N/A |
| | ADDITIONAL FUNDING: N/A |
| | FUNDING SOURCE:N/A |
|
|