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Council adopts revised fund-balance policy to hold 30% of general fund as unassigned reserve
Summary
Finance staff recommended and the council adopted a policy to maintain unassigned general‑fund balance at 30% of the next fiscal year's budget; staff said the current fund balance is about $34 million and projected maintaining 30% would yield roughly $36 million with approximately $3 million available for committed one‑time projects.
The finance department proposed a revised fund-balance policy that would maintain unassigned fund balance at 30% of the subsequent fiscal year's general-fund expenditures. Finance staff said the city’s current unassigned fund balance is roughly $34,000,000 and that, based on FY26 budget projections, maintaining the 30% floor would result in a projected $36,000,000 unassigned balance and enable the creation of a committed fund balance of about $3,000,000 for one‑time capital projects.
Councilors debated the policy's effect on taxpayers, bond ratings and fiscal flexibility. Finance staff cited GFOA guidance and said the policy would be viewed favorably by rating agencies; Councilor (transcript label 14) warned the 30% floor is a relatively high policy standard and emphasized a spillover clause in the policy to address taxpayer concerns. The council voted to adopt the revised fund-balance policy as presented.
