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(1) Review and Discussion of the City’s Contingency Reserve Policy; and (2) if Desired, Establishment of New Contingency Reserve Ad Hoc Subcommittee and Appointment of Members to Research Contingency Reserve Policies in Comparable Cities.
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Meeting Date: May 14, 2025
Contact Person/Dept: James Lambert /Finance Department
Phone Number: (310) 253-5865
Fiscal Impact: Yes [] No [X] General Fund: Yes [] No [X]
Public Hearing: [] Action Item: [X] Attachments: []
Public Notification: (E-Mail) Meetings and Agendas - Finance Advisory Committee (05/08/2025)
Departmental Approval: Lisa Soghor, Chief Financial Officer (05/07/2025)
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RECOMMENDATION
Staff recommends the Finance Advisory Committee (FAC) (1) review and discuss the City’s Contingency Reserve Policy; and (2) if desired, establish a Contingency Reserve Ad Hoc Subcommittee and appoint members to research contingency reserve policies in comparable cities.
BACKGROUND/DISCUSSION
The City’s General Fund budget currently has a structural deficit and has relied upon General Fund Reserves to maintain and expand services. The current Contingency Reserve Policy has a target balance of 30% of the General Fund “Operating Budget”. The 10-year Financial Forecast predicts that the City will be unable to maintain the 30% target in the near term.
At the April 9, 2025 FAC Regular Meeting, the FAC requested that staff agendize a discussion of the City’s Contingency Reserve Policy. The Contingency Reserve Policy as established in City Council Policy No. 5002 (Financial Policies) is provided as Attachment 1.
ATTACHMENTS
1. 2025_05_14 ATT1 - Contingency Reserve Policy.pdf
MOTION
That the FAC:
1. Review and discuss the City’s Contingency Reserve Policy; and
2. If desired, establish a Contingency Reserve Ad Hoc Subcommittee and appoint members.