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An ordinance amending Title 5 of the Metropolitan Code of Laws by adding a new section requiring the metropolitan government to adopt and maintain a fund balance reserve policy.
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WHEREAS, the metropolitan council by Resolution No. R89-959 adopted a financial management policy for maintaining in fund balance a reserve of at least 5% of the three operating funds budget (the GSD and USD General Funds and the General Purpose School Fund); and,
WHEREAS, the 1989 financial management policy did not contain criteria for when the reserve's funds could be utilized nor plan for replenishment of the reserve once spent; and,
WHEREAS, the Government Finance Officers Association ("GFOA") has developed best practices encouraging governments to establish a more robust fund balance policy not only setting minimum thresholds for the unrestricted fund balance maintenance but that it also include criteria for the uses and replenishment of the fund balance; and,
WHEREAS, the provisions in this ordinance and the adoption of a policy pursuant hereto will bring the metropolitan government in step with the best practices as provided by the GFOA; and,
WHEREAS, it is in the interest of the citizens of the Metropolitan Government of Nashville and Davidson County that this ordinance be adopted.
NOW, THEREFORE, BE IT ENACTED BY THE COUNCIL OF THE METROPOLITAN GOVERNMENT OF NASHVILLE AND DAVIDSON COUNTY:
Section 1. That Title 5 of the Metropolitan Code of Laws is amended to add a new section, as follows:
5.04.160 - Fund balance reserve policy required.
A. Definitions-As used in this section:
1. "Debt service funds" shall mean the General Services District General Purposes Debt Service Fund, the Urban Services District General Purposes Debt Service Fund, and the General Services District School Purposes Debt Service Fund.
2. "Fund balance" shall mean the accumulated amount of excess revenues minus expenditures in a particular metropolitan government fund that is unrestricted as defin...
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