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Bristol council approves updated finance policies, sets debt and fund-balance goals
Summary
City Council approved updated finance policies that incorporate the city's budget policy, reference state code, remove a now-defunct solid waste fund from calculations and set targets including an 18% unassigned fund-balance goal and a 5% general-obligation debt ceiling (policy goal).
Bristol City Council on Jan. 28 approved updates to the city's financial policies that, among other changes, fold the separate budget policy into the financial policies, add statutory references for the budget process, remove the now-closed solid waste fund from fund-balance calculations and reaffirm targets intended to strengthen long-term fiscal stability.
An assistant city manager and the finance committee presented the recommended changes and said the revisions were reviewed by the finance committee, which recommended approval. The presentation summarized policy changes including: incorporating the 2017 budget policy language into the financial-policy document; specifying the budget process in accordance with Title 15.2, Chapter 25 of the Code of Virginia; clarifying appropriation-ordinance language and budget-adjustment procedures; and removing the solid waste fund from unassigned fund-balance calculations because the fund no longer exists.
The presentation reiterated policy goals: an unassigned fund-balance target equal to 18% of general fund revenues (excluding pass-throughs and internal transfers), a requirement for a five-year capital improvement plan, and a policy goal to limit general-obligation debt to 5% of assessed property value (the policy notes state law allows up to 10% and the 5% figure is the city's internal target). The policies set reporting requirements for monthly and quarterly financial statements, annual audits, and debt-ratio calculations presented annually with the proposed budget.
A council member moved to approve the updated finance policies as presented; the motion passed on roll call with the transcript recording "Yes" votes from Barnum, Holmes, Osborne, Pollard and Mays. Council members thanked finance staff and the assistant city manager/CFO for the work on the updates. The council's public record will reflect the policy changes and the finance committee's recommendation.
Key clarifications recorded at the meeting: the city's budget basis is cash basis; reassessments for real property are to be completed every four years per policy; one-time revenues should be limited to one-time expenditures; budget adjustments between line items may be authorized by the city manager but increases in appropriation or transfers between funds require council approval.
