RES 972?7 ARESOLUTIONNO.
A RESOLUTION adopting financial goals and policies for
management of city funds.
WHEREAS,the City Finance Department has prepared a document entitled “City of
Camas Financial Goals and Policies”,which sets forth a fiscal guideline for management of city
funds,and
WHEREAS,the City Council has reviewed said document and has determined that the
City’s interests will be furthered by adoption of such goals and policies,
NOW,THEREFORE,be it resolved by the Council of the City of Camas as follows:
Section I
There is hereby adopted as the official guidelines for the fiscal management of the City’s
funds that certain document entitled “City of Camas Financial Goals and Policies”,a copy of
which is attached hereto and by this reference incorporated herein.
ADOPTED by the Council at a regular meeting this nyofOcJdbefr,2003.
i /
///
SIGNED:^Mayor
/K,ATTEST:
Clerk
PROVED as to form:
i
City Attorney
Exhibit A
City of Camas
Financial Goals and Policies
1.Reserves and Fund Balance
2.Long-range forecasting
3.Debt Management
4.Budget
5.Grants
6.Water Sewer and Sanitation Utility Operations
7.Real Estate Excise Taxes
8.Technologies and System Maintenance and Replacement
9.Equipment Rental
10.Emergency Rescue Fund
11.Firemen’s Pension Fund
12.Capital Facilities Plan
13.Accounting Procedures
14.Investments
1.Reserves and Fund Balance
Goal:The General Fund will strive to maintain a Tax Interim Stabilization
reserve of 12%of the property tax levy and additional fund balance of 10%of
total budgeted expenditures.
To mitigate current and future revenue shortfalls and unanticipated
expenditures,a fund balance reserve in the General Fund will be maintained .
The reserved fund balance designated as Tax Interim Stabilization shall
remain at 12%of the annual property tax levy to accommodate for the
liquidity and cash flows during the year when property tax revenue collection
is low.In addition,as another goal,10%of the annual budgeted expenditures
should be reserved as Undesignated/Designated Fund Balance.
12%of Total General 10%of
Tax Levy Levy Fund Expenses ExpensesYear Goal Actual
2000 6,043,662 725,239 12,142,952 1,214,295 1,939,535 1,670,060
2001 7,043,517 845,222 10,973,687 1,097,369 1,942,591 2,176,597
2002 6,874,142 824,897 11,800,896 1,180,090 2,004,987 2,276,309
2003 7,244,113 869,294 12,135,806 1,213,581 2,082,874 Not available
1
2.Long-range Forecasting
Goal:A long -range forecasting of revenues and expenditures for a three -year
period will be done each year by August 1.
A financial plan that assesses long -term financial implications of current and
proposed programs assists the city in developing strategies to achieve its
goals.A key component is the forecasting of revenues and expenditures.As
part of the budget process each year ,by August 1 a long -range forecast of
operating revenues and expenditures for the General Fund and the Street
Fund will be developed for a three -year period beyond the current budget
period.The underlying assumptions should be clearly stated .The forecast
will be included in the final budget document that is adopted by ordinance .
3.Debt Management
Goaf General obligation and revenue debt will only be issued for capital needs
and structured to limit financing costs and future commitments.
Long-term debt will only be issued for real property,or capital projects and
capital acquisitions with a life greater than three years.Long -term debt will
not be issued to finance current operations.The maturity of long -term debt
will be equal to or less than the expected life of the project or acquisition,and
no longer than 20 years.
Interfund borrowing for short -term cash flow needs should be considered over
external borrowing for terms less than two years.A resolution adopted by the
council will approve and detail the terms of the borrowing.
Loans from state agencies with favored interest rates and repayment terms
should be considered whenever possible .The funding source for repayment of
the loan shall be indicated.
The city will comply with the bond covenants detailed in each revenue bond
issue.For the 1998 Water and Sewer Revenue Refunding Bonds,the
requirement is gross revenues less operation and maintenance costs before
depreciation equate to at least 1.4 times the maximum annual debt service .
The 1996 Water and Sewer Revenue Refunding Bonds require the same debt
coverage.
Debt Service Coverage
12/31/00
12/31/01
12/31/02
1.89
2.18
2.89
2
At the first optional redemption date for each general obligation or revenue
bond issue ,(usually ten years after issuance)an analysis will be done to
determine if exercising a call would be financially prudent at that time .If the
bonds are not called at that time,this analysis will continue at least every two
years.
The city will comply with IRS arbitrage regulations for bond issues,document
the compliance and maintain files of documentation until 3 years after the
bonds are matured .
All debt service obligations will be detailed in the Comprehensive Annual
Financial Report .
4.Budget
Goal:A comprehensive annual budget will be adopted after careful
consideration of public needs,their input,and availability of funding.
After a thorough and integrated budget process including taking public
testimony,an annual comprehensive budget will be adopted by ordinance .A
detailed budget document disclosing all anticipated revenues and authorized
appropriations for operating and capital expenditures will be prepared and
published .The budget establishes the level of services to be provided by each
department with anticipated revenues and limited resources.The budget will
include title of each employee position funded ,number of staff in each position
and full -time equivalents.Expenditures will be monitored through the
accounting system with monthly reports to assure budgetary compliance .
Discretionary revenues received on a one -time basis will be used to increase
fund reserves,or used for capital expenditures or other uses that are not
dependent on ongoing revenues,and will not be used for operating
expenditures.
Example of a one -time revenue is the close out of the LID guaranty fund of
$250,000 that was transferred to the General Fund and increased fund
balance .
5.Grants
Goaf Capital grants will be sought to support the city’s capital plans.
Capital grants will be sought to supplement existing programs,supports the
city’s capital plans and goals and objectives.Grants that require a local
match will be carefully considered before each application is submitted .
3
Grants that are funded to the city as a cost reimbursement grant will be
analyzed to determine if cash flow needs can be met .
The City will comply with the Common Rule,an attachment to Office of
Management and Budget (OMB)Circular A -102,which sets forth uniform
requirements for grants to local governments.This requires the city’s
financial management system to meet certain standards for financial
reporting,accounting records,internal control,budgeting,allowable costs,
documentation,and cash management.In addition,expenditures of federal
grants and costs claimed for reimbursement or used for matching,must be in
compliance with OMB Circular A -87,Cost Principles for State and Local
Governments.
6.Water Sewer and Sanitation Utility Operations
Goal User rates and system development charges will finance all operations,
capital and debt service for utility functions.
Utility Rates
Goal:User rates will be reviewed not less frequently than every 5 years to
determine if revenue covers operating costs.
All costs of providing utility services for the Water -Sewer and the Sanitation
Utilities,including maintenance ,depreciation,and debt service requirements
shall be financed through user rates.Capital construction for the Water -
Sewer fund will primarily be financed by system development charges and
revenue bond proceeds if needed .
Retained Earnings
Goal:To mitigate current and future revenue shortfalls and unanticipated
expenses,retained earnings of at least 90 days of operating expenses will be
maintained.
In addition retained earnings,cash and investments in the water sewer bond
reserve fund will be equal or greater to the highest annual debt service
requirement .Interest earnings that accumulate in this fund may be
transferred periodically to the water sewer operating fund .
Water Sewer Capital Reserve
Goal 'Cash and investments of a minimum of $500,000 should be retained for
emergency capital repairs or other unforeseen events.
4
Water and sewer system development charges are accumulated in the Water
Sewer Capital Reserve fund for future capital construction.System
development connection charges for capital contributions for both Water and
Sewer will be reviewed not less frequently than every 5 years to determine if
they are adequate to meet capital needs.
System Development
Charge RevenuesCashandInvestments
12/31/00
12/31/01
12/31/02
$4,494,270
$2,676,892
$1,161,697
$1,762,654
$999,574
$1,260,380
7.Real Estate Excise Taxes
Goal:Through 2006,approximately $200,000 a year of REET 1 is dedicated to
debt service for the Fire Facility.
The first quarter of one percent of the real estate excise tax (REET l)must be
used solely on capital projects that are listed in the capital facilities plan
element of the City’s comprehensive plan.Capital projects are defined in RCW
82.46.010 as:“those public works projects of a local government for planning,
acquisition,construction,reconstruction,repair,replacement ,rehabilitation,
or improvement of streets,’roads!highways!sidewalks!street and road
lighting systems!traffic signals,bridges,domestic water systems!storm and
sanitary sewer systems!parks!recreational facilities!law enforcement
facilities!fire protection facilities!trails!libraries!administrative and judicial
facilities....”
Through the Capital Facilities Plan,projections of uses of the revenue from
the first quarter percent of the Real Estate Excise Tax will be listed .
REET 1 Receipts Expenses Balance Pledged
$279,664 $909,541 $97,822 $
$402,042 $499,864 $0 $615,646
$409,054 $346,159 $62,895 $900,890
12/30/00
12/31/01
12/31/02
0
Goal:Revenue from the second quarter of the Real Estate Excise Tax will be
dedicated primarily to park improvements.
The second quarter of one percent of the real estate excise tax (REET 2)
capital projects are defined in RCW 82.46.035 as:“those public works of a
local government for planning,acquisition,construction,reconstruction,
repair ,replacement ,rehabilitation,or improvement of streets,roads,
highways,sidewalks,street and road lighting systems,traffic signals,bridges,
domestic water systems,storm and sanitary sewer systems,and planning,
5
construction,reconstruction,repair,rehabilitation,or improvement of parks.”
The acquisition of land for parks is not permitted .
REET 2 Receipts Expenses Balance Pledged
$273,664 $0 $273,196 $
$413,857 $330,000 $357,052 $
$417,211 $494,708 $279,556 $260,000
12/30/00
12/31/01
12/31/02
0
0
8.Technologies and System Maintenance and Replacement
Goal:A plan to maintain and replace technologies,provide quality,up -to -date
networking technologies,maintain secure and accurate data,and to provide
efficient,reliable tools and resources for a productive working environment.
The Information Systems Division oversees and maintains a replacement plan
for the City’s technologies including the following criteria ^
Networking,telecommunications and other hardware resources are
maintained or replaced using current warranty and depreciation
measures.Approximately 25%of the City’s technology resources are
replaced each year.Personal Computers have a life of three to four
years,depending on the use of the PC and other system/application
requirements.
System resources including operating and other system software ,
database applications,and desktop applications are upgraded and
maintained to meet the technology needs of the organization and the
best fit for departmental service plans.
Technology equipment necessary for the Water /Sewer ,Sanitary and
Emergency Rescue funds will be paid for out of their respective funds.
9.Equipment Rental
Goal-'The Equipment Rental Fund will maintain rental rates sufficient to
cover all operating costs and replacement reserve.
Equipment rental rates will be sufficient to cover operating and maintenance
costs,property and liability insurance coverage ,plus depreciation and to
establish a reserve sufficient to replace vehicles and equipment at the end of
their useful lives.The reserve will include estimated replacement cost of
vehicles and equipment ,recognizing that replacement costs often escalate.
Rates will be adopted by resolution and will be reviewed at least annually to
determine if revenues cover all costs.
6
Equipment is depreciated over its estimated useful life .Below is a listing of
the general categories of equipment and their estimated lives:
Vehicle Type
Dump Truck
Pick -up Truck
Tractors
Sweepers
General automobiles
Police vehicles
Sewer Cleaners
Mowers
Sanitation Trucks
Sanitation Scooters
Police Scooter
Fire Engine
Useful Life
6 -10 years
6 —7 years
7 —10 years
7 -10 years
5 -9 years
3 years
8 years
4 —7.5 years
10 years
2.5 -5 years
6 years
20 years*
*Information only,not accounted for in the Equipment Rental Fund
10.Emergency Rescue Fund
Goal'The Emergency Rescue Fund will be self -supporting for all capital and
operating expenses associated with providing Advanced Life Support
ambulance transport services within the participating jurisdictions.
Service Description
The Emergency Rescue Fund (Rescue Fund)was created in 1970 by
Ordinance 1161.A service agreement between the City of Camas and the
City of Washougal,Clark County Fire District #1 and Clark County Fire
District #9 provides for advanced life support ambulance transport service to
all persons within the boundaries of these districts.Additionally,a non -taxed
area east from 192nd Ave .to the western city limits of Camas is served by the
City of Camas,as the closest ambulance provider,as determined by the
County Medical Program Director .The ambulance service area encompasses
about 95 sq.mi.of southeastern Clark County and a population of about
45,000 residents.Emergency ambulance transport services from locations
within the ambulance service area are provided to the closest available and
appropriate medical facility.Southwest Medical Center in Vancouver is the
most frequently used hospital facility,although all hospitals in the greater
Portland area are used as necessary.A mutual aid agreement with the
private ambulance provider for the City of Vancouver assures availability of
ambulance services during periods of peak demand .
Personnel funded through the Rescue Fund for provision of ambulance
services are based on a formula for demand on the service .Camas General
7
Fund firefighters are utilized during times of peak ambulance demand and
are temporarily replaced with overtime personnel at Rescue Fund expense .
Rescue Fund firefighter -paramedics may also assist as needed to combat
significant fires and an ambulance re -staffed with temporary overtime
personnel at General Fund expense .
Special Tax Levy
Goal-Every six years the council,in collaboration with EMS partner
jurisdictions will determine the special tax levy rate to ask the voters to
support the emergency services function,including operating and replacement
costs for ambulances and equipment.
As a goal,the property tax levy will be designed to support 50%or more of the
operating and capital expenses.The current levy was last approved by voters
within each district in the September 19,2000 election,for the 2001 -2006
period .The six -year tax levy of $0.25 per $1,000 of assessed property value
provides that the tax levy monies collected within the participating
jurisdictions are remitted to the City of Camas.
Percent Levy
Covered Expenses
2000
2001
2002
49%
49%
63%
Financial
Goal-'A minimum of 12%of budgeted annual expenses will be maintained in
reserved fund balance to accommodate for liquidity and cash flow needs
during the year when property tax revenue collection is low.
Ambulance transport fees schedules will be reviewed at least every 2 years to
assure these rates and the tax levy meet amortized capital and annual
operating costs.Write -off of un -collectable transport accounts will occur at
least annually.
Each year during the budget process,overhead costs that the rescue function
will contribute to the General Fund for its services will be calculated and
budgeted based on a formula that includes the percentage of total city
employees to Emergency Rescue Fund employees.
8
Contribution to
General Fund
$120,000
$123,600
$77,600
2000
2001
2002
Equipment
Goal:Replace ambulance chassis’every six years and every twelve years
replace the complete ambulances.
Currently,a fleet of three primary transport ambulances and one reserve
ambulance is maintained to provide transport ambulance services.
Ambulance chassis are replaced on a 6 -year cycle .Chassis mileage at
replacement is about 130,000 miles.Patient compartments are refurbished at
6 years when the chassis is replaced and complete ambulances are replaced at
12 years.Cost for a completely new ambulance is about $130,000.Patient
compartment refurbishing and chassis replacement cost is about $80,000.
Major equipment carried on an ambulance ,including heart monitoring and
defibrillation equipment ,cost about $50,000.Disposable supplies and
medications used in the treatment of patients continually turn over and are
funded through annual operating budgets.
11.Firemen’s Pension Fund
Goal-The Firemen’s Pension Fund assets will be sufficient to cover all benefit
obligations for retirees and their beneficiaries.
Chapter 41.16 RCW required the establishment of a Firemen’s Pension Fund
for firefighters hired prior to March 1,1970.Cash and investments in this
fund will be sufficient to cover all benefit obligations for retirees and their
beneficiaries.All investment earnings will be retained in this fund .The
annual fire insurance premium tax from the state will also be deposited into
this fund .
12.Capital Facilities Plan
GoaT The Capital Facilities Plan will be comprehensive and updated every
two years.
As part of the Growth Management Act Comprehensive Plan,the City will
adopt a Capital Facilities Plan element and update and extend it not less
frequently than two years and distributed prior to August 1.This plan is a
9
long-range plan that will forecast facility needs and requirements citywide for
each year for the next six years,and then project additional needs for the next
14 years for a total of a twenty -year forecast .It will also forecast projected
revenues and resources required to finance the capital improvement plans.In
addition to facilities listed in the plan,it will include projections for major
equipment requirements valued over $50,000.
Before a capital facility is approved and budgeted for construction or
remodeling,impacts of annual operating costs of the new or expanded facility
will be estimated and disclosed .
13.Accounting Procedures
Goal -The city’s accounting principles will follow General Accepted Accounting
Principles.
The city will maintain a high standard of accounting practices and follow
General Accepted Accounting Principles (GAAP)for its accounting procedures
and financial statement presentation.The city will comply with the
Washington State Budgeting,Accounting and Reporting System (BARS)
manual prescribed by the Washington State Auditors Office.Each year the
city will prepare and publish a Comprehensive Annual Financial Report
(CAFR)in addition to the annual report required by the BARS manual.
14.Investments
Goal -The city’s investment program will maximize the security ofprincipal
while conforming to state statutes.
The city will conform to state statutes that govern the investment of public
funds.Cash will be invested in a diverse portfolio and in a manner that will
provide the maximum security with the best investment return.Sufficient
cash shall be maintained to provide adequate funds for current operating
expenditures before cash is invested .A formal investment policy adopted by
resolution will guide the management of the portfolio.
10