Commission codifies reserve policy, requires supermajority vote to spend general fund reserves

The Coral Gables City Commission on May 6 voted to codify its existing fund balance and reserve policy into city code and to require a four-fifths vote before general fund reserves may be spent, except during a declared state of emergency.

Deputy City Attorney Stephanie Throckmorton said the ordinance codifies resolution 2016-34, establishing a 25% reserve requirement and related reserve policy language. "This ordinance provides that use of the reserves would require a 4 fist vote via resolution unless there's a stated emergency," she told the commission.

Supporters emphasized fiscal prudence and protection of bond ratings. Mayor Lago described using reserves after hurricanes to act quickly and warned that tapping reserves could weaken the city's triple-A (described in discussion as triple-tier) bond standing and increase borrowing costs. "If you tap into the reserves, it shows financial weakness and it puts us at risk," he said.

Commissioner Fernandez said he supports maintaining reserves but noted other municipalities sometimes use credit lines or other tools to leverage funds for capital projects; he opposed a reduced threshold that would remove resident oversight. The ordinance passed with recorded votes showing Vice Mayor Anderson yes, Commissioner Fernandez no, Commissioner Lara yes, Mayor Lago yes.

The ordinance will be codified as chapter 2, article 7, division 1, section 2-352 (fund balance and reserve policy) and requires a four-fifths vote for spending reserves in non-emergency circumstances. The commission also noted that the policy itself may be amended later only by ordinance and a four-fifths vote.