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_ . <br /> ikke_A-y\--) <br /> MEMO TO: MAYOR AND CITY COUNCIlk <br /> FROM: CLERK-ADMINISTRAT044, <br /> DATE: June 26, 1990 <br /> SUBJECT: UNDESIGNATED RESERVES <br /> As you may recall, the Management Report submitted by Voto, <br /> Tautges, Redpath and Company along with the 1989 Annual <br /> Financial Report discussed on pages 17 and 18, copy attached, <br /> the need for adequate reserves . The Report also warned that <br /> the State was looking at basing aid cuts on the size of a <br /> city's reserves . <br /> What was not stated in the Report, but was discussed at the <br /> June 18th presentation is a further warning that undesignated <br /> reserves would confirm the premise on which this approach is <br /> based and that is, "Cities have more money than they need. " <br /> Undesignated reserves are surplus revenues which have not been <br /> set aside for a specific purpose. In our case, surplus <br /> reserves are identified as undesignated when the City's policy <br /> . on reserves has been met and the remaining funds are not <br /> identified for some other specific purpose. <br /> The summary of our current reserve status is on page 19 of the <br /> Management Report and page 20 of the Financial Report, copies <br /> attached, show that after all requirements of our reserve <br /> policy have been met a $342,989 undesignated reserve exists . <br /> In order to avoid the risk of these dollars being used by the <br /> State to penalize us, our auditors, Finance Director Brager <br /> and I would recommend that the funds be designated for some <br /> specific purpose(s) . Your options are many and varied and <br /> include the following, <br /> - b — - - - <br /> as a buffer against the "lean" years we see coming. <br /> B. Set aside for special long-term projects such as City <br /> Hall expansion/remodeling, a Street Maintenance fund to <br /> subsidize the annual cost for sealcoating and overlay, <br /> add to the Special Projects Fund or Park Improvement <br /> Fund, or create a new fund with a specific purpose and <br /> intent in mind. <br /> C. Designate for current projects or needs in the City. <br /> The list of unmet projects/needs is probably endless, <br /> • but I have taken the liberty to have the Department <br /> Head Team submit a list of proposed projects and <br />