Page 199 - 2018 Village Ordinance Book 122818

State of Wisconsin County of Racine Village of Sturtevant

RESOLUTION 2018-49
(6-13-18)

RESOLUTION BY THE FINANCE AND BUDGETARY COMMITTEE
ESTABLISHING A WORKING CAPITAL FUND FOR THE VILLAGE OF

STURTEVANT

WHEREAS, the Village of Sturtevant annually prepares a budget in accordance
with Chapter 3.03 of the Code of Ordinances and relevant to Wisconsin Statues, and

WHEREAS, pursuant to Chapter 3.03 of the Village Code of Ordnances, the
Village is required to estimate the amount of money which raised from general property
taxes and other sources will be necessary to meet the proposed expenditures on an
annual basis, and

WHEREAS, said annualized estimate does not take into consideration the

surpluses and shortfalls occurring through the year because of the irregular flows of

income and expenses recognized by the Village and the resulting working capital

shortfalls which accrue from time to time unless an adequate cash surplus is provided
for in the prior year’s budget, and

WHEREAS, industry standards recommend that a working capital fund
equivalent to twenty-five (25) percent of the Village’s annual budget be established, and

WHEREAS, the Village Board recognizes that the establishment of such a fund

would among other things:
a) Improve the Village’s bond rating,
b) Simplify the budgeting process by setting a standard for each year’s

working capital fund,

c) Save the Village interest costs, bank charges, and administrative time as a

result of short term borrowings necessitated during the year to meet

shortfalls and working capital, and

d) Clear up any question in the budgeting process as to the meaning of an
ending “surplus’ which could be reduced in any given year in order to

lower the tax rate.

NOW THEREFORE, the Village Board of the Village of Sturtevant, Racine
County, Wisconsin does hereby resolve:

1. PURPOSE. To provide a stable financial environment for the Village of
Sturtevant’s operations that allow the Village to provide quality services to
its residents in a fiscally responsible manner designed to keep services
and taxes as consistent as possible over time. This fund balance policy is
meant to serve as the framework upon which consistent operations may
be built and sustained.

2. OBJECTIVE. The intent of this policy is to insulate the Village from large,
unanticipated one time expenditures or revenue reductions resulting from
external changes; to provide funds to allow the Village to respond to
unforeseen emergencies; to establish and maintain a “pay as you go”
capital improvement fund attempting to minimize the need for long-term
debt; to provide sufficient working capital to eliminate the need for short-