AgdaPkt 2011-08-22 - Laserfiche WebLink

Browse Search

6.1.G. - Page 4 City's fiscal health with specific target minimums, and make a specific recommendation back to the City Council for action. Response: This recommendation will not be implemented as the City does not agree that development of an additional calculated metric will provide added value in measuring the City's fiscal health unless the metric is understood fully by the users of the financial statements. As noted in the Grand Jury's report, a Running Liquidity metric could be defined and calculated in a variety of ways, whereas the GFOA clearly outlines minimum unreserved general fund balances at 1) no less than 5-15 percent of regular general fund operating revenues, or 2) no less than one to two months of regular fund operating expenditures. The City already calculates and maintains its minimum general fund unappropriated fund balance at 15 — 20% of estimated general fund revenues, in line with the GFOA recommended policy. Recommendation D.1. The City Councils of Atherton, Brisbane, Burlingame, Daly City, Foster City, Millbrae, Redwood City, San Bruno, San Mateo, and South San Francisco by July 2012 explain in CAFR Management Notes, Annual Budget, or other appropriate document available to the public why full annual required OPEB payments are not being made. Response This recommendation will not be implemented because it is not warranted. The City of Redwood City was erroneously included on this list, as beginning with fiscal year 2009- 10 the City entered into a trust agreement with CERBT and has made its full annual required OPEB payment (ARC) in fiscal years 2009-10 and 2010-11. The City continues to budget the full annual required OPEB payment in future years as well. Recommendation D.2. The City Councils of Atherton, Brisbane, Burlingame, Daly City, Foster City, Millbrae, Redwood City, San Bruno, San Mateo, and South San Francisco by July 2012 explain in CAFR Management Notes, Annual Budget, or other appropriate document available to the public the city's planned strategy for addressing accumulated unfunded OPEB retiree healthcare obligations. Response: The recommendation has already been implemented as the actuarial valuation performed to determine the ARC builds into the ARC an amount that will fully amortize the unfunded OPEB liability, which the City has interpreted to be the Net OPEB Obligation (NOO). This methodology is explained in the CAFR Notes to Financial Statements. ALTERNATIVES The City Council may elect to not approve the response as submitted, and may make changes to the response.