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2018 Annual Report • Finance Department • St. Anthony Village, Minnesota <br /> <br /> <br /> <br />15 <br /> <br />MINIMUM FUND BALANCE POLICY – REVISED IN 2018 <br />The purpose of the City’s Minimum Fund Balance Policy is to ensure that sufficient cash <br />holdings exist to meet day to day operating needs. The policy states that ending unassigned <br />General fund balance should be at 30%-35% of the upcoming year’s budgeted expenditures. This <br />requirement is based on the fact that City receives tax collections in July and December. <br />Therefore the fund balance at year end provides the necessary working capital to manage cash <br />flow throughout the upcoming year. <br />The City’s fund balance was revised in 2018 to expand the expenditures excluded from the <br />General Fund baseline spending. Similar to existing exclusions these expenditures are <br />reimbursed to the city through contract for services or by direct state aid. Therefore these <br />expenditures are not reliant on levy collection timing. The estimated actual 2018 General fund <br />balance is currently at 37.75% providing reserve balance slight above policy requirements, see <br />chart below. <br /> <br />Maintaining an adequate fund balance is <br />necessary for operations and is a key factor <br />used in bond ratings. <br /> <br /> <br /> <br />2018 LIQUOR OPERATIONS IMPACT’S <br />FUND BALANCE AS WELL <br />The Liquor operations improved profits allowed for a 25% increase in the planned transfer to the <br />General Fund in 2018. The additional $50,000 transfer added 1.75% to the Fund balance reserve. <br />Congratulations to Mike Larson and his staff at the Liquor stores for their outstanding year!