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Council Revises City Finance Code to Streamline Transfers, Tighten Encumbrance Rules
Summary
Carmel’s council unanimously adopted changes to city code that ease small intra-category transfers, clarify controller duties on the chart of accounts and remove the ability to encumber funds without a written contract.
The Common Council approved, 9–0, an amended ordinance Feb. 3 that updates the city’s chart-of-accounts and transfer rules to reflect current practice and tighten controls on encumbrances.
Zach Jackson, the city controller, told the council the changes remove an administrative step that required departments to split intra-category transfers into two $25,000 moves when the code had an effectively higher limit. The amendment clarifies the city controller’s role in updating the chart of accounts while preserving the council’s statutory authority to direct changes.
The revised ordinance also eliminates a section that had allowed departments to carry forward (encumber) dollars from one fiscal year to the next absent a written contract or purchase order. Jackson said the prior language could be used to hold funds open without a contractual basis and that the ordinance now requires departments to submit PO/contract information annually to the controller for compilation and reporting to council.
Councilors praised the change as improving transparency and easing the budget process. The finance committee had recommended the amended language earlier in the day; the council approved the amendment and then approved the amended ordinance in the same session. Recorded vote was 9–0.
Practical effect: Departments can complete intra-category transfers up to the stated limits without the prior procedural workaround; the controller will compile and report year-end encumbrances based on POs and contracts to ensure accurate tracking and oversight.
The council also requested that the controller and finance committee continue to review chart-of-accounts line-item clarity and that staff report back on any additional standardization needed for the next budget cycle.
