| | | | | | | |  | ADMINISTRATION
G.5. |
M E M O R A N D U M |
| | | | | | | | TO:
| Board of Directors | FROM:
| Joseph H. Parker, CPA, Director of Financial Services
| DATE:
| May 10, 2021 | RE:
| Revised Reserve Policy |
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| | | | | | | | | RECOMMENDATION: | | Adopt Resolution 21-__ Revising the Agency's Personnel and Administrative Manual, Chapter 3, Article 13 - Section 3502, Reserve Policy.
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| | | | | | | | | BACKGROUND: | | In March 2005, the Board considered and approved the Agency’s first Net Asset Reserve and
Designation Policy. This policy provided understanding and formalized the Agency’s reserve and
designation structure and practice. In May 2007, this policy was refined and reserve target expanded. The existing Reserve Policy was last updated in 2015.
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| | | | | | | | | DISCUSSION: | | Overall, the primary substance of the existing reserve policy remains unchanged. This revised version was discussed with the Board's Finance Committee at their meeting on July 1, 2021.
The revised policy includes certain clarifying revisions as follows:
- Added language to provide for the Director of Financial Services to annually present a report of reserve activity to the Agency's Finance Committee. In addition, the recommended annual funding and funding targets of reserve accounts will be presented to the Finance Committee. The Board will authorize these funding allocations and funding targets with adoption of the annual budget.
- The accumulated employee leave reserve target will be set between 50% and 100% of the current accumulated employee leave balance.
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