1999-054-Revising Town Financial PoliciesRESOLUTION 1999 - 54
RESOLUTION OF THE TOWN COUNCIL OF
THE TOWN OF LOS GATOS
REVISING TOWN FINANCIAL POLICIES
WHEREAS, the Town's budget is adopted annually as an expenditure and
comprehensive financial plan; and
WHEREAS, the Council policy is to provide quality services, maintain current
Town facilities and equipment, provide improvements to meet changing needs of the
community and establish reserves to meet known and unknown future liabilities; and
WHEREAS, the Town has established specific financial policies including
revenue policies, reserve policies, budgeting and expenditure and Capital Improvement
policies which now require revision to create reasonable flexibility.
RESOLVED, that Resolution 1992 -169 is rescinded and the Financial Policies
(attached) are and shall be the applicable controlling policies for the Town of Los Gatos.
PASSED AND ADOPTED at a regular meeting of the Town Council of the Town
of Los Gatos, California, held on the 17th day of May, 1999 by the following vote:
COUNCIL MEMBERS:
AYES: Randy Attaway, Steven Blanton, Linda Lubeck, Joe Pirzynski,
Mayor Jan Hutchins.
NAYS: None
ABSENT: None
ABSTAIN: None
SIGs
ATTEST:
CLERK OF THE `i'OWN OF XSGATOS
LOS GATOS, CALIFORNIA
TOS
REVENUE:
TOWN OF LOS GATOS
FINANCIAL POLICIES
The Town will encourage a diversified growing revenue base that is locally
generated to shelter the community from fluctuations in any one revenue source.
The Town will follow an aggressive policy of auditing and collecting all locally
generated taxes.
The Town will establish and maintain all user charges and fees based on the cost
of providing services.
BUDGETING & EXPENDITURE:
• Current year operating expenses will be totally funded by current year revenues.
• General Fund reserves will be used only for non - recurring "one- time" and capital
projects and not for on -going operations.
• Long -term debt will be confined to capital improvements or special projects that
cannot be financed from current revenues.
• The Town Manager is authorized to implement the programs as approved in the
adopted budget. Within a specific fund, the Town Manager may transfer
appropriations between categories, departments, projects, and programs as needed
to implement the adopted budget.
• With the approval of the Town Manager, unexpended appropriations may be
carried forward to the next fiscal year provided the funds have been previously
encumbered for a specific purpose.
The annual operating budget will include a $100,000 Designated Contingency for
non - recurring, unanticipated expenditures. The Town Manager may approve
expenditures from this contingency if needed during the fiscal year.
A capital outlay (fixed asset) purchase will be any single item or piece of
equipment which costs more than $5,000 and has an expected useful life
exceeding one year.
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• Quarterly budget reports will be submitted to the Town Council to provide
information on the status of the Town's financial condition.
RESERVE:
• Reserves will be established, dedicated and maintained annually to meet known
and estimated unknown future liabilities.
• The Specific Reserve Accounts include but are not limited to a restricted reserve
for totally funded workers' compensation and unemployment insurance. Liability
insurance including one year's premium payment to the insurance carrier or pool.
• Vacation for all vested hours of vacation earnings.
• Fully funded retirement for all employees covered by the town retirement
program.
• Economic uncertainty set at a minimum of $2.5 million.
• Depreciation and replacement of equipment.
• Maintenance of buildings.
CAPITAL IMPROVEMENT:
• Capital Improvement projects will be funded by the following:
• Available general fund reserves
• Gas taxes
• Construction fund fees
• Utility
• Capital
• Parks
• Storm drain basin fees
• Other state and federal funding sources as they become available
• The Town will develop a multi -year plan for capital improvements to be updated
annually. Future capital expenditures will be projected annually for a 5 year
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May 12, 1999
period based on changes in the community or replacement of the infrastructure.
• The annual capital improvement plan will be based on the multi -year capital
improvement plan.
• The Town will coordinate development of the Capital Improvement Program with
the development of the operating budget.
• The Town will identify the estimated costs and potential funding sources for each
capital project proposed prior to its submittal to the Council for approval.
• Capital projects financed by issuing bonds will be paid back within a period not to
exceed the useful life of the project.
• The Town Manger is authorized to implement the projects as approved in the
adopted capital improvement program. Within a specific Fund, the Town Manger
may transfer appropriations between projects as needed to implement the adopted
capital improvement program.
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May 12, 1999