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MOM <br />Honorable Mayor and Members of the City Council <br />City of Link Lakes <br />Page 15 <br />General Fund — Fund Balance (Continued) <br />The City of Lino Lakes has improved the financial position of its General Fund over the past several <br />years. We commend the City for these actions and encourage the City to continue to monitor its <br />reserve balances. An adequate reserve structure will enable the City to retain its financial <br />independence and integrity during adverse economic conditions. <br />Even though the Fund Balance has been designated for the above items the budget for the following <br />year will need to be amended to provide for the additional expenditures. Also, the City Charter could <br />pose an obstacle in the event the City ever needed to access these reserves. Charter sections 7.07 <br />and 7.08 prevent making expenditures in excess of appropriations and also prevents amendments, <br />which increase appropriations unless revenues are also increased. Therefore, even though reserves <br />are established, the Charter's budget restrictions could possibly prevent the City from expending such <br />reserves if the needed expenditures were unbudgeted. <br />