2012-2013 Budget - City of Saginaw MI

UNASSIGNED FUND BALANCE ANALYSISThe City of Saginaw operates from a balanced budget at the onset of every fiscal year. Unassigned fundbalance or prior year budgetary surplus can be appropriated to balance a fund’s budget if a sufficientbalance/surplus exists and the appropriation is fiscally prudent.In FY 2013, the city will not appropriate any use of unassigned fund balance in the General Fund. At the timeof budget development it was determined that the reserve balance was less than 10% and could not be utilizedto balance the fund. The 2013 budget is a balance budget that includes approximately $1.5 million in one-timerevenue sources. Furthermore, it is estimate that by the end of FY 2013, the city will have a negativeunassigned General Fund reserve balance of -$981,941. The reason for this deficit can be attributed to the Citynot receiving the Homeland Security- SAFER Grant to cover the salaries and benefits of seven firefighters. Asa result, three months or 25%of salaries and benefits were redirected to the General Fund.The Special Revenue Funds is projected to end FY 2012 in a budgetary deficit. The primary reason for this isdue to $790,486 deficit in the Celebration Park Fund. As a result of the initial deficit, the city was required tofile a Deficit Elimination Plan with the State of Michigan. The projected estimated unassigned fund balance asof June 30, 2013 is -$233,336. This is also contributed to the deficit that is realized in the Celebration ParkFund. However, with the implementation of the Deficit Elimination Plan, the deficit will decrease each year.Enterprise Funds for year-ending FY 2012 is projected to have a surplus of $23,666,866. This positive endingbalance is a direct result of the Water Supply System Revenue Refunding Bonds, Series 2012 proceeds.Additionally, the City has imposed a rate increase to the Sewer Operations and Maintenance Funds for a threeyear period. This will allow for the city to continue in its effort to update the Wastewater Treatment Facilities.Overall, the estimated unassigned fund balance or net assets for this fund type is projected to be $31,181,622by year-ending June 30, 2013.Internal Services Fund’s June 30, 2013 unassigned fund balance is projected at $872,319. This is due to an therealignment and increases to Charges for Services for the Motor Pool Operations, Technical Services –Information Services, Technical Services – Geographical Information System costs, Workers Compensation,and Self-Insurance Funds.Fiduciary Fund projects an $112,924,667 estimated unassigned fund balance for June 30, 2013. Favorablemarket conditions have produced significant gains in the Police and Fire Pension and the Unfunded LiabilitiesFunds.55