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City of Redwood City 7.1.A. - Page 95 <br /> Notes to the Basic Financial Statements <br /> For the year ended June 30, 2014 <br /> NOTE 10 - NET POSITION AND FUND BALANCES (CONTINUED) <br /> Restricted describes the portion of net position which is restricted as to use by the terms and conditions of <br /> agreements with outside parties, governmental regulations, laws, or other restrictions which the City <br /> cannot unilaterally alter. These principally include developer fees received for use on capital projects, debt <br /> service requirements, and redevelopment funds restricted to low and moderate income purposes. At <br /> June 30, 2014, restricted net position for the governmental activities were $49,268,810 of which all was <br /> restricted by enabling legislation. <br /> Unrestricted describes the portion of net position which is not restricted as to use. <br /> 8. Fund Balances <br /> In the fund financial statements, fund balances represent the net current assets of each fund. Net current <br /> assets generally represent a fund's cash and receivables, less its liabilities. As prescribed by GASB <br /> Statement No. 54, governmental funds report fund balance in classifications based primarily on the extent <br /> to which the City is bound to honor constraints on the specific purposes for which amounts in the funds <br /> can be spent. As of June 30, 2014, fund balances for governmental funds are made up of the following: <br /> Nonspendable Fund Balance — includes amounts that are (a) not in spendable form, or (b) legally or <br /> contractually required to be maintained intact. The "not in spendable form" criterion includes items that <br /> are not expected to be converted to cash, for example: inventories, prepaid amounts, and long -term loans <br /> receivable. <br /> Restricted Fund Balance — includes amounts that can be spent only for the specific purposes stipulated <br /> by external resource providers, constitutionally or through enabling legislation. Restrictions may <br /> effectively be changed or lifted only with the consent of resource providers. <br /> Committed Fund Balance — includes amounts that can only be used for the specific purposes <br /> determined by a formal action, adopting a resolution, of the City's highest level of decision - making <br /> authority, the City Council. Commitments may be changed or lifted only by the City adopting another <br /> resolution, as a resolution imposed the constraint originally. <br /> Assigned Fund Balance — comprises amounts intended to be used by the City for specific purposes that <br /> are neither restricted nor committed. Intent is expressed by the City Council or City Manager, to which <br /> the City Council has delegated the authority through a resolution, to assign amounts to be used for <br /> specific purposes. <br /> Pursuant to the authority delegated by City Council, the City Manager determines the amount of <br /> assigned fund balances, which includes items such as encumbrances, and constrained amounts when it <br /> is the City's intent to use proceeds or collections for a specific purpose, and residual fund balances, if <br /> any, of special revenue, capital projects and debt service funds which have not been restricted or <br /> committed. <br /> Unassigned Fund Balance — is the residual classification for the general fund and includes all amounts <br /> not contained in the other classifications. Unassigned amounts are technically available for any <br /> purpose. In other governmental funds, if expenditures exceed amounts restricted, committed, or <br /> assigned, the negative amount is reflected as negative unassigned fund balance. Within the unassigned <br /> 67 <br />