AGENDA PACKET - Laserfiche WebLink

Page 6 of 7 General Fund Reserves and Fund Balance as of June 30, 2023 The General Fund achieved positive financial results in fiscal year 2022/23 mainly due to one- time supplemental property tax, sales tax audit correction, improved hotel tax revenue, and one-time savings from vacant positions. The City also recognized $4.3 million in American Rescue Plan Act (ARPA) stimulus funds. This funding source is no longer available after fiscal year 2022/23. Available resources allowed the City to achieve the 20 percent reserve target established by the City Council. The $29.6 million in unassigned fund balance represents about 2.4 months of fiscal year 2023/24 operating expenditures. The GFOA recommends no less than 2 months (16.7 percent) of operating reserve. Enterprise Funds and Internal Service Funds - Operating Results and Net Position This section provides an overview of the City’s key enterprise and internal service funds operating results and net position. • The consolidated Water Enterprise Fund including operating and capital funds ended the year with $4.9 million in deficit mainly due to expenses exceeding revenues. The Water Operating Fund had a reserve balance of $7.5 million, which equals 20.9 percent of the combined Water Operating Fund’s FY 2023/24 budgeted operating expenses. The reserve level is below the 35 percent reserve target. • The consolidated Sewer Enterprise Fund including operating and capital funds ended the year with $2.8 million in deficit mainly due to expenses exceeding revenues. The Sewer Operating Fund had a reserve balance of $7.5 million, which equals 42.4 percent of the combined Sewer Operating Fund’s FY 2023/24 budgeted operating expenses. The reserve level is above the 35 percent reserve target. • The net position for the Workers’ Comp Fund, which is consolidated into the Employee Benefits Internal service Fund, was -$4.0 million. The City will continue to make additional contributions into this fund to eliminate the deficit over time. The Workers’ Comp Fund relies heavily on the General Fund. • The Replacement/Renovation Internal Service Fund consolidating the City’s repair and replacement funds (vehicles, parks, facilities, IT, traffic signals, etc.) had $31.8 million in net position. The General Fund mainly supports repair and replacement funds. Excluding the $11.1 million in net investment in capital assets or non-spendable resources, $20.7 million is available for near-term and long-term infrastructure repair and replacement. There is a significant funding gap between available resources and funding needs. New revenue sources will need to be identified to support citywide infrastructure improvements. Page 167 of 554