The URL can be used to link to this page

Home My WebLink About2016-74 - Establishing a General Fund Surplus Utilization PolicyRESOLUTION NO. 2016-74 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NEWPORT BEACH, CALIFORNIA, ESTABLISHING A GENERAL FUND SURPLUS UTILIZATION POLICY WHEREAS, the City of Newport Beach ("City") may end the 2015-2016 fiscal year and future fiscal years with a surplus of revenues over expenditures, encumbrances and commitments due to a variety of factors, such as economic expansion, frugal operations, or changes to various projects and programs; WHEREAS, Budget Surplus Funds are those funds that result after closing the City's accounting records for the fiscal year; WHEREAS, the City desires to develop this policy to help guide the City Council with the expenditure of Budget Surplus Funds; and WHEREAS, from time to time, the City Manager shall recommend allocations to the City Council on the use of Budget Surplus Funds consistent with the uses identified in this policy. NOW, THEREFORE, the City Council of the City of Newport Beach hereby resolves as follows: Section 1: City Council Policy F-5 General Fund Surplus Utilization, attached hereto as Exhibit "A" and incorporated herein by reference is hereby approved and adopted. Section 2: All resolutions or parts thereof, in conflict with this resolution are hereby repealed. Section 3: The recitals provided above are true and correct and incorporated into the operative part of this resolution. Section 4: The City Council finds the adoption of this resolution is not subject to the California Environmental Quality Act ("CEQA") pursuant to Sections 15060(c)(2) (the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment) and 15060(c)(3) (the activity is not a project as defined in Section 15378) of the CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, because it has no potential for resulting in physical change to the environment, directly or indirectly. Section 5: If any section, subsection, sentence, clause or phrase of this resolution is, for any reason, held to be invalid or unconstitutional, such decision shall not affect the validity or constitutionality of the remaining portions of this resolution. The City Council hereby declares that it would have passed this resolution, and each section, subsection, sentence, clause or phrase hereof, irrespective of the fact that any one or more sections, subsections, sentences, clauses or phrases be declared invalid or unconstitutional. Resolution No. 2016-74 Page 2 of 2 Section 6: This resolution and City Council Policy F-5 shall take effect immediately upon its adoption by the City Council, and the City Clerk shall certify the vote adopting the resolution. ADOPTED this 14Th day of June, 2016. ATTEST: d�dmc- )-h"-Y" Leilani I. Brown City Clerk Diane B. Dixon / Mayor Attachment: Exhibit A - City Council Policy F-5 EXHIBIT A GENERAL FUND SURPLUS UTILIZATION PURPOSE F-5 To establish a City Council policy for the use of surplus funds resulting from unrestricted General Fund annual revenues exceeding total actual expenditures, encumbrances, and commitments for a given fiscal year. BACKGROUND Due to a variety of factors, such as economic expansion, frugal operations, or changes to various projects and programs, the City of Newport Beach may end a fiscal year with a surplus of revenues over expenditures, encumbrances and commitments. Budget Surplus Funds are those surplus funds that result after closing the City's accounting records for a fiscal year. From time to time, the City Manager may recommend allocations to the City Council on the use of Budget Surplus Funds consistent with the uses identified in this policy. POLICY A. One-time funds, such as grant proceeds, should be used for one-time expenditures; therefore, the City Council should not use one-time and Budget Surplus Funds in a way that creates new on-going expenditure requirements unless the City Council can demonstrate that adequate resources exist to support the on-going expenditure requirements. B. After addressing approved budget amendments, reserve deficiencies and other matters of fiscal concern, the City Manager or his/her designee may recommend that Budget Surplus Funds be used to fund City needs in the manner described in this policy, as approved by the City Council, at a public meeting. C. Roughly fifty percent (50%) of the Budget Surplus Funds shall be used to address long- term obligations such as pension liabilities, other post -employment benefits, bonded debt, lease obligations and other long-term needs. Unlike ongoing needs such as salaries, long- term needs do not require ongoing funding over an indeterminable period of time. D. Roughly fifty percent (50%) of the Budget Surplus Funds shall be used to address infrastructure or neighborhood capital improvements, guided by a philosophy that these expenditures should seek to improve the community's safety, aesthetics, transportation, and/or quality of life. Adopted - June 14, 2016 1 STATE OF CALIFORNIA } COUNTY OF ORANGE } ss. CITY OF NEWPORT BEACH } I, Leilani I. Brown, City Clerk of the City of Newport Beach, California, do hereby certify that the whole number of members of the City Council is seven; that the foregoing resolution, being Resolution No. 2016-74 was duly and regularly introduced before and adopted by the City Council of said City at a regular meeting of said Council, duly and regularly held on the 14'h day of June, 2016, and that the same was so passed and adopted by the following vote, to wit: AYES: Council Member Peotter, Council Member Duffield, Council Member Selich, Council Member Curry, Council Member Petros, Mayor Pro Tem Muldoon, Mayor Dixon NAYS: None IN WITNESS WHEREOF, I have hereunto subscribed my name and affixed the official seal of said City this 15M day of June, 2016. &1�4'&W� Leilani I. Brown, MMC City Clerk Newport Beach, California . (Seal)