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HomeMy WebLinkAboutJune 1 2011 meeting minutes LRFC - for 07-06-1 MINUTES OF THE LONG RANGE FINANCE COMMITTEE June 1, 2011 ROOM 406 The regular meeting of the Long Range Finance Committee was held on Wednesday, June 1, 2011, in Room 406, at Oshkosh City Hall, 215 Church Avenue. The meeting was called to order by Chair Harold Buchholz, at 5:00 p.m. Members Present: Harold Buchholz, Jeffrey Thoms, Bryan Schulz, Jeff Herzig, and Tom Pech Jr. Members Absent: Don Simons, Doug Pearson, Jason Hirschberg, Deb Allison-Aasby Staff Present: Peggy Steeno-Finance Director, Lori Burns–Administrative Assistant I.INTRODUCTION OF NEW MEMBERS / COUNCIL APPOINTMENTS Chair Buchholz announced that there are two new members due to Council Appointments by the Mayor. The new members are Council member Tom Pech Jr. and Council Member Deb Allison-Aasby. Council Member Allison-Aasby was unable to attend. Council Member Pech provided a brief history of his work experience and education. II.APPROVAL OF MAY 4, 2011 MINUTES Confirm that the group would like Professor Karl Nollenberger to attend the July 6 Meeting to recap the 2011 Budget Survey that his class completed on behalf of the City. It is anticipated that this will be a 15 minute discussion. Motion by Thoms, Second by Schulz, to approve the Committee Meeting Minutes of May 4, 2011. Motion passed unanimously. Chair Buchholz entertained a motion to have the meeting conclude at 6:30 pm instead of 7:00 pm due to the number of members absent. Motion passed unanimously. III.CITIZEN INPUT None IV.FUND BALANCE POLICY (~5:05 – 6:25) 1.Review of the Draft of Fund Balance Policy. 2.Changes Needed 3.Review Current Fund Balance Details 4.Next Steps The discussion began with the two options for the Target / Goal Balance that was presented by staff. The Committee decided to remove option two, which provided for a range for the Fund Balance percentage, and go with a minimum Fund Balance of 16%, which equates to two months of revenues. The committee asked staff to review the definitions and delete the ones that are not needed, and explain the definition of Fund Balance a little better. Also, staff should review the policy and clarify the term ‘Fund Balance’ where necessary. Since the ‘Unassigned Fund Balance’ as stated in the Audit is the number being used, this also should be clarified. The discussion moved to the Objective and the Committee asked staff to revise this section and include a statement that the goal is to refrain from using the Fund Balance to balance the City’s Annual Budget. The next section discussed was the ‘Target / Goal Balance’, and there were some revisions to this section to streamline it. The ‘Funding / Replenishment’ section was also discussed and revisions, as well as streamlining of this section, were also requested. Under the ‘Monitoring’ section there was a request to make it two distinct paragraphs in addition to a few revisions. (Per the discussion at the May 4, 2011 Meeting, the Committee has already determined that there is a strong need for the policy.) The Committee discussed the stakeholders that have an interest in the Fund Balance policy. Citizens, staff, Council, independent auditors, and rating agencies were discussed. It was noted that Moody’s, the City’s current rating agency regarding public bond offerings, has asked for the City’s policy in the past and was interested in the fact that the Long Range Finance Committee was going to be looking at formalizing a policy. This is something that they were very insistent on that the city should have. The Committee would like to see the Fund Balance information, if approved by the Council, included in the Annual Budget to make readers cognizant of the policy and where the numbers are at in relation to the goals of the policy. The Committee considered the inclusion of special funds in the calculation of the Fund Balance however, it was decided that this policy should be in concert with GASB 54, Fund Balance Reporting and Governmental Fund Type Definitions, and refer to the Unassigned Fund Balance as stated in the Audit. Consensus of all committee members was that staff should make the necessary revisions and bring back to the Committee to finalize at the July Meeting. Staff should also draft a memo from the Committee to the Council that explains the policy and states that it is being done to: acknowledge and formalize current practice, establish continuity, and prudently manage financial resources. The memo should also inform the Council that ‘Best Practices’ were reviewed to create this policy and the policy incorporates GASB 54. The Committee hopes to finalize the draft and memo at the July 6, 2011 Meeting so that it can be forwarded to the Council for consideration at their July 12, 2011 meeting. V.INFORMATION SHARING/HOUSEKEEPING ITEMS (~6:25-6:35) 1.Discuss Budget Survey – Q & A st 2.1 Quarter 2011 Financial Overview 3.Update on Impact of State Budget Bills Information Sharing was held, and will be discussed at the July 6, 2011 Meeting. VI.FUTURE TOPIC SUGGESTIONS / ONGOING TOPICS LIST The Committee hopes to wrap up the Fund Balance Policy topic at the July Meeting, and send their recommendation to the Council for consideration immediately so that the policy can be put into place, if the Council approved in the near future. The Committee briefly discussed what the next topic would be. The suggestions included: Fund Balance Policies for Other Funds, City Budget Issues, updating the Investment Policy, increasing revenues, and a five year budget forecast. This will be discussed and a next topic will be selected at the July Meeting. VII.MOTION FOR ADJOURNMENT Motion by Pech, Second by Herzig, to adjourn. Motion passed unanimously. Meeting adjourned at 6:35 p.m.