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Page 12 of 15 Table 11. Retirees Medical Reserve Funds - Amended Budget vs. Actual Replacement/Renovation Funds. In accordance with the City’s financial policies, the City maintains various Replacement/Renovation Funds. The purpose of these funds is to provide ongoing replacement of City equipment, vehicles, traffic signals, streetlights, and to make major repairs/renovations to City facilities, parks, and medians to extend their useful lives. As described in Table 12 below, collectively, expenditures from the Repair and Replacement funds were $3.4 million less than anticipated in FY 2022/23. Any unspent funds remain in the Repair and Replacement funds to be expended on projects and equipment or vehicle replacements in the future. Contributions from the General Fund were budgeted at the appropriate level, while corresponding revenues in the Repair & Replacement Funds were budgeted at a lower level. With funding available in the General Fund, transfers were made at the budgeted contribution levels. Actual net transfers ended up with a difference of $32,000 due to an adjusted transfer amount from the Golf Operating Fund to the Golf Repair and Replacement Fund. Notably, many of the City’s Repair and Replacement funds do not have an adequate fund balance to cover necessary project costs and/or replace aging equipment or vehicles in a timely manner. For example, the Information Technology Repair and Replacement Fund, which funds replacement costs for the City’s technology equipment, such as computers, monitors, servers, network equipment, has an estimated ending fund balance of just over $0.1 million. The Facilities Repair and Renovation Fund, which is used as a primary funding source for minor facility repairs and modifications, as well as unanticipated repairs at any of the City’s facilities, needs additional funding. This fund has also traditionally been used to pay the City’s share of costs associated with gymnasium-related repairs or upgrades. As part of the 2023-25 biennial budget development process, staff performed a preliminary analysis to estimate the level of contributions needed from the General Fund to the Repair and Replacement Funds and determined that the current annual contribution levels are not sufficient. A more comprehensive analysis is planned as part of the Asset Management Plan Study that is now underway to better estimate an appropriate level of funding needed to support each Repair and Replacement Fund. Page 264 of 270