HomeMy WebLinkAbout2021-03-23; Council Policy No. 91 - Long Term General Fund Capital Funding Policy
Attachment A
Policy No. 91
Date Issued 03/23/2021
Resolution No. 2021-139
City Council
POLICY STATEMENT
Subject: Long Term General Fund Capital Funding Policy
Purpose
The purpose of this policy is to establish a long-term capital funding policy to:
•Ensure the needs of the city are met;
•Provide a funding source for long-term, large value capital purchases; and
•Demonstrate continued prudent fiscal management.
This policy also sets forth guidelines for establishing a plan to replenish capital fund balances to
include both how such replenishment is to be funded and the period over which the
replenishment is to occur.
Background .
Many city assets demand large capital expenditures, examples include roads, buildings, parks,
and information technology infrastructure. The city funds the General Fund portion of these
necessary investments in four ways:
1)The General Capital Construction Fund is primarily used to fund new General Fund
infrastructure projects that do not fall into the Technology Investment Capital Fund
projects, such as such as streets, libraries, parks, fire stations and administration
facilities.
2)The Infrastructure Replacement Fund is primarily used to fund the General Fund's
proportional share of repair and replacement of infrastructure projects that do not fall
into the Technology Investment Capital Fund projects, such as such as streets, libraries,
parks, fire stations and administration facilities, water, sewer and drainage facilities and
other facilities located on or in the ground.
3)The Technology Investment Capital Fund is primarily used to fund the General Fund's
proportional share of new capital investments that are principally comprised of
technology, including hardware, software and other digital technology.
4)Information Technology Asset Replacement Fund, an Internal Service Fund, is primarily
used to fund all contributing Funds' IT hardware repair and replacement costs.
Statement of policy
It is the policy of the City of Carlsbad to adopt an annual budget that includes a transfer from
the General Fund to one or more of the city's long-term capital funds. The long-term capital
funds include the General Capital Construction Fund, the Infrastructure Replacement Fund and
the Technology Investment Capital Fund.
June 8, 2021 Item #13 Page 13 of 35
The city commits to targeting a transfer to the city’s long-term capital funds of 6% of budgeted
General Fund revenues. The transfers shall be proposed during the annual budget process or on
an as needed basis for the City Council’s consideration.
It is the policy of the City of Carlsbad to adopt an annual budget that includes a chargeback by
the IT Internal Service Fund to fund the city’s future IT hardware repair and replacement
related needs.
June 8, 2021 Item #13 Page 14 of 35