TO: Board of Supervisors
FROM: Ryan J. Alsop, County Executive Officer
REPORT BY: Daniel Sanchez, Senior Management Analyst
SUBJECT: Strategic Financial Plan and Budget Policy
RECOMMENDATION
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Approve the Fiscal Year 2024-25 Strategic Financial Plan and Budget Policy. (No Fiscal Impact, Discretionary)
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BACKGROUND
As the FY2024-25 budget process begins, the CEO proposes revisions to the Strategic Financial Plan and Budget Policy that will guide staff in developing the FY2024-25 Recommended Budget. The proposed FY2024-25 budget policies build on prior budget policies, while being updated to reflect the current conditions of the organization. Staff will return in late February with the 5-Year Forecast.
Several substantive changes are proposed this year. Previously the Budget Policy and Strategic Financial Plan were separate documents. Both documents address fundamentally similar issues and consolidation better serves the users. The Strategic Financial Plan and Budget Policy also includes proposed changes:
1. General Reserves are currently 13% of appropriations in operating funds less transfers and is recommended to increase to 15% to reflect approximately two months' operations per Government Finance Officers' Association best practices for entities with stable revenues. Further, staff recommends deletion of Assignment for Fiscal Uncertainty at 10% and Appropriation for Contingency at 3% in all funds except internal service funds because the designations provide no operational or policy benefit. The CEO will recommend the Board retain available fund balance at budget adoption to access when operating needs occur during the year. The Board must take an action to appropriate available fund balance.
2. Recognize Excess Educational Revenue Augmentation Fund in year earned and discontinue treatment as one-time revenue. While the amount does fluctuate, historical data is available for estimation purposes, and the variance will be positive with conservativ...
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