City of Alexandria, Virginia
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MEMORANDUM
DATE: MAY 18, 2016
TO: THE HONORABLE MAYOR AND MEMBERS OF CITY COUNCIL
FROM: MARK B. JINKS, CITY MANAGER /s/
DOCKET TITLE:
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Consideration of a Fund Balance Policy Related to the Alexandria City Public Schools.
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ISSUE: Consideration of support of a Fund Balance Policy related to the Alexandria City Public Schools (ACPS).
RECOMMENDATION: That City Council endorse the proposed Alexandria City Public Schools Fund Balance Policy (Attachment 1).
DISCUSSION: On May 19, 2016, the Alexandria School Board is scheduled to adopt the attached policy at its legislative session. The policy was developed jointly by City and Schools staff to: (1) formalize a longstanding general and mutual understanding between the City and ACPS that once an operating transfer is made from the City to ACPS, any surplus or savings derived from those transfers accrues for the future use by ACPS in subsequent fiscal years and does not revert back to the City; and (2) allow the creation of a reserve of up to one percent of the total ACPS operating budget for unforeseen one-time expenditures, resources for expenditures or revenue shortfalls.
This proposed policy offers a quantifiable policy for utilization by ACPS. Based on the policy, ACPS operating fund Fund Balance will be maintained to fund a maximum of two percent of the total ACPS operating budget for the current year, and a maximum of two percent of the total ACPS operating budget for the upcoming year (for a total of four percent), and up to an additional one percent of Spendable Fund Balance is available to address unforeseen revenue shortfalls or additional expenditures. Any remaining funds beyond this five percent (2%+2%+1%=5%) will go towards future ACPS capital needs. This proposed policy puts nearly all year end surplus monies to work through the annual budg...
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