The Town of Buena Vista Board of Trustees on July 8 adopted a suite of finance documents — an overarching finance policy, a new investment policy and a financial reserve policy — and approved increasing the general fund emergency reserve.

Town finance staff presented the proposals and asked the board to choose an emergency-reserve target. The board adopted a new emergency-reserve policy that sets the general fund emergency reserve at 42% of annual operating expenditures (roughly five months’ worth of operating expenses under 2025 budget figures). Town staff characterized the change as a shift from the town’s longstanding 27% reserve (about 3.2 months) to a more conservative five-month buffer because of Buena Vista’s relative isolation and hazard exposure.

Philip, the town finance presenter, said the recommendation was “moving from the 27%, 3, a little over 3 months up to 42%, 5 months emergency reserve.” Trustees discussed liquidity and how the recommended change would reduce the town’s unrestricted fund balance available for capital projects while increasing the emergency cushion. Staff said the emergency reserve will remain in liquid instruments (cash and ColoTrust) and that the town could use unrestricted fund balance for one-time capital or maintenance needs.

Trustees also adopted a written investment policy that sets safety, liquidity and yield as the investment priorities and restricts investment maturities to five years to comply with state law. The financial reserve policy sets enterprise-fund reserves at a three-month operating level for funds such as water and airport and provides guidance on when reserves may be used, reporting requirements, and reserve replenishment.

Following staff presentation and questions, trustees passed three resolutions adopting the finance policies (Resolution 51), the investment policy (Resolution 52) and the financial reserve policy (Resolution 53). Trustees and staff said auditors and grantors prefer clearly documented policies and that the reserves will give the town flexibility to cover immediate costs during incidents while pursuing reimbursements.