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_7 /Z Wanaa�a <br />MAYOR <br />Bill Blesener <br />COUNCIL <br />Rick Montour <br />Barbara Allan <br />John Keis <br />Michael McGraw <br />515 Little Canada Road, Little Canada, MN 55117 -1600 ADMINISTRATOR <br />(651) 766 -4029 / FAX: (651) 766 -4048 Joel R. Hanson <br />www.ci.little-canada.mn.us <br />MEMORANDUM <br />TO: Mayor Blesener and Members of the City Council <br />FROM: Shelly Rueckert, Finance Director <br />DATE: September 20, 2007 <br />RE: Reserve Policy Amendment <br />The Council adopted the following policy in April of 2006, superseding the City's prior <br />Reserve Policy and retiring the General Fund Surplus Transfer Policy. <br />• City of Little Canada Reserve Policy Statement <br />a. In order to provide adequate reserves for future expenditures, the <br />City's General Fund balance and Special Revenue Fund balances should <br />be at no time greater than 50% of the prior year's current expenditures. <br />Current expenditures are defined as current expenditures in the General <br />Fund, Special Revenue Funds, and Capital Projects Funds. <br />b. Upon the receipt of the annual audit, the Finance Director will <br />compute the transfer necessary to bring the prior year's fund balances in <br />line with a 42.5% reserve ratio. The fund providing the transfer will be <br />the General Fund. A copy of the initial calculation is attached as Exhibit <br />A. <br />c. The Parks and Recreation Special Fund, Economic Development <br />Fund, Cable Fund, and Gambling Fund are excluded from the requirement <br />to transfer funds because these funds were established for specific needs, <br />therefore their fund balances should remain for those purposes. <br />d. The reserve funds in excess of the 42.5% will be transferred and <br />maintained in the General Capital Improvement Fund. These funds will <br />only be available for future transfer back to the General Fund or for levy <br />adjustments which would have the same effect. <br />