HomeMy WebLinkAboutRes 2015-92 - IS Fund 577 - Compensated AbsencesCITY OF PALM DESERT
STAFF REPORT
FINANCE DEPARTMENT
REQUEST: Adoption of Resolution No. 2015- 92 establishing an internal service
Fund 577 for compensated absences in the City of Palm Desert.
SUBMITTED BY: Paul S. Gibson, Finance Director
DATE: November 12, 2015
CONTENTS: Resolution No. 2015- 92
Recommendation
By Minute Motion, that the City Council:
1. Waive further reading and adopt a resolution establishing an internal service
Fund 577 for compensated absences in the City of Palm Desert;
2. Approve a transfer in the amount of $56,000 from the General Fund to
Compensated Absences Fund; and
3. Appropriate $82,402 to Compensated Absences Fund.
Background
Every year, Finance has reserved funding equal to the accumulated vacation and sick time, which
is recorded as a liability. Last fiscal year, Finance transferred said funds to the Retiree Health
Fund for this purpose as instructed by the City Manager. In the process of the audit for the fiscal
year ended June 30, 2015, our auditors White Nelson Diehl Evans, LLP, requested that a separate
fund be established as an internal service fund to account for these types of transactions. This
fund would also have a budget to pay for any payouts at the time of retirement or termination or
other separation.
Staff recommends establishing Fund 577, Internal Service Fund — Compensated Absences and
appropriate $82,402 to cover the costs of current year payouts and change in liability. This
calculation was determined as follows:
$2,700,000 Balance from Retiree Health Fund
56,000 Additional covered liability from General Fund
+ (82,402) Expended during Fiscal Year 14/15
$2,673,598 Ending Compensated Absences reserve
I
Staff Report
Adoption of Resolution 2013- 92 - Establish fund for Economic Development projects
April 25, 2013
Page 2 Of 2
Fiscal Analysis
Adoption of this resolution will result in the establishment of Fund 577 and the appropriation of
$82,402.
Submitted By:
Paul S. Gibson, Finance Director
Approval:
n M. Wohlmuth, City Manager
G1Fnanceftamh ortega\staff Reports\sR - adopt res for new Internal Service Fund - Compensated Balances
102615.docx
CASH FLOWS FROM OPERATING ACTIV.
Receipts from customers
Payments to suppliers
NET CASH PROVIDED BY
OPERATING ACTIVITIES
CASH FLOWS FROM NONCAPITAL AND
RELATED FINANCING ACTIVITIES:
Interest paid can Bean
Cash received from ether funds
Cash paid to other funds
NET CASH PROVIDED (USED) BY
NONCAPITAL AND RELATED
ACTIVITIES
CASH FLOWS FROM CAPITAL AND
RELATED FINANCING ACTIVrrIES:
Purchases of capital assets
Proceeds on sale of assets
:Principal (laid can leases
Interest paid can leases
NET GASH USED BY CAPITAL AND
RELATED FINANCING ACTIVFTIE;
CASH FLOWS FROM INVESTING ACTIVI
Interest and dividends
NET INCREASE (DECREASE) IN
CASH AND CASH EQUIVALENTS
CASH AND CASH EQUIVALENTS -
BEGINNING OF YEAR
CASH AND CASH EQUIVALENTS -
END OF YEAR
Schedule ` ?
Total
2„S£1
(123,289)
(120,48
3,97 ,000
3,976,000
(35,245)
190,540
(194,705)
A
RESOLUTION NO. 2015- 92
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PALM DESERT,
CALIFORNIA, TO ESTABLISH A FUND FOR PURPOSES OF INTERNAL
SERVICE FUND FOR COMPENSATED ABSENCES IN THE CITY OF PALM
DESERT
WHEREAS, City staff historically fully funded and set aside funds for the purpose of
compensated balances; and
WHEREAS, the City desires to establish a fund for purposes of tracking expenditures,
budgeting, setting aside funds for this purpose; and
WHEREAS, the City desires to eliminate major budget adjustments within the General
Fund; and
WHEREAS, the City desires to establish and designate a fund for the specific purpose of
said Compensated Absences Liability activity.
NOW, THEREFORE, BE IT RESOLVED, that:
1. The Finance Director will establish Fund 577, Internal Service Fund —
Compensated Absences for the purpose described herein; and
2. The Finance Director will be authorized to transfer $2,700,000 from Fund 576 to
this new Fund 577 to establish the new fund. Funds were set aside in previous fiscal years for
purposes of which are reflected in the notes for Long Term Liabilities of each fiscal year.
Additionally, the General Fund will transfer $56,000 for Fiscal Year 2014-2015 to the new fund to
cover the current change in the liability which is budgeted in General Fund Transfer out account.
3. The fund created will be restricted to committed funds, representing resources
whose use is constrained by limitations such as specific purpose as defined above and imposed
by action herein, and remain binding unless removed in the same manner.
PASSED, APPROVED and ADOPTED by the City Council of the City of Palm Desert,
California, at its regular meeting held on the 12th of November, 2015, by the following vote, to wit:
AYES:
NOES:
ABSENT:
ABSTAIN:
ATTEST:
RACHELLE D. KLASSEN, CITY CLERK
CITY OF PALM DESERT, CALIFORNIA
SUSAN MARIE WEBER, MAYOR