Folsom Municipal Code Art. V Financial Procedures

The City Council may not levy a property tax for general municipal purposes in excess of the maximum rate applicable to the City on the effective date of this Charter provided, however, that a tax in excess thereof may be levied if authorized by state general law, or if authorized by the affirmative votes of a majority of the City's voters voting on a proposition to increase such levy.

A. Statement on Years of Levy. The number of years that any such additional levy is to be made shall be specified in such proposition.

B. Separate Taxing Areas. Nothing herein contained shall preclude the Council from establishing separate taxing areas within the City for the levy of a tax in excess of such maximum rate if authorized by state law, by ordinance, or by the affirmative votes of a majority of the voters within the area voting on a proposition to impose or to increase such levy.

C. Procedure for Assessment. The procedure and authority for the assessment, levy and collection of taxes may be prescribed by ordinance and, in the absence of such an ordinance the procedure and authority applicable thereto shall be that prescribed by state law.

The City Council shall, by ordinance, establish capital outlay and reserve funds for specified capital improvement and replacement purposes, and such other special funds as it may deem necessary.

A. Inviolate Funds. Such special funds shall remain inviolate for the purpose for which they were created unless the use of such funds for some other purpose is authorized by an ordinance adopted by a four-fifths vote of the Council after holding of a public hearing.

B. Disposition of Special Funds. Any unexpended and unencumbered balance remaining in any such special fund after the purpose for which the special fund was created has been accomplished shall be transferred by the Council to the General Fund or to the most appropriate other special fund.

Investment of monies held by the City and any of its agencies shall be made pursuant to policy set by ordinance. Such policy shall comply with guidelines for the investment of public monies as recommended by Moody's and Standard and Poor's credit rating services.

The City Council shall by ordinance provide for a purchasing and contracting system assuring a maximum of competition for the lowest price consistent with a stated level of quality. The purchasing and contracting system shall provide for:

A. Delegation of Authority. Control of the system by the City Manager, who shall be empowered to make purchases and to award contracts for amounts of $10,000 or less, adjusted in amount annually as set out herein in Subsection C;

1. Delegation of responsibility by the City Manager to any appointed subordinate;

2. A requirement that should contracts or purchases in amount of $10,000 or less be awarded to any 1 vendor or contractor cumulatively totalling $100,000 in any 3-year period then, in that event, the competitive process set out herein shall be followed should such process otherwise be required hereunder;

3. An informal bid solicitation process for purchases and contracts in amount between $10,001 and $24,999;

B. Award of Contracts and Purchases. Award of contracts and purchases to the lowest responsible bidder or vendor meeting specifications, except as provided herein and in the ordinance;

C. Sealed Competitive Bids. Sealed bids for competitive purchases involving the expenditure of $25,000 or more, but this amount and all dollar amounts set out in this section shall be revised by the Council annually as part of the annual budget by a revision factor determined by utilizing reliable indicators or indices of price changes;

D. Waiver of Bids. Waiver of competitive bidding for purchase of non-competitive items and contracting for services, in emergencies, for copyrighted and patented items and services, and for professional or specialized services for which a written finding is filed with the City Clerk regarding the reason for non-competitive, emergency or sole source acquisition;

E. Other Procedures. Provision for step procurement involving request for information, request for proposal, request for technical services, and joint contract or purchase awards for subcontracts, and joint bidding with or purchasing through other governmental jurisdictions;

F. Prohibition. Prohibition of splitting contracts or purchases to avoid dollar limits;

G. Rejections. Rejection by the Council of any and all bids;

H. Bid Bonds. Requirement of a bid bond or certified check for all sealed bids;

I. Public Notification. Full public notification of all calls for sealed bids by provision of 10 days' notice through appropriate publications;

J. Public Works Determinations. Determination of which public works or improvement projects are to be performed by City forces and which are to be let to contract;

K. Other Matters. Other matters as shall be determined to be required by the Council.

The City Council shall by ordinance provide for an integrated budgeting and financial management system for the City. The ordinance shall provide for the following, which shall be required:

A. Fiscal Year. Establishment of a fiscal year;

B. Annual Budget. An annual budget and budget message by the City Manager for the ensuing fiscal year shall be submitted on or before the first working day of the last month of the current fiscal year;

C. Budget Message. The budget shall include a budget message by the City Manager, which message shall provide an explanation of the budget, both in fiscal terms and in terms of the work programs. The message shall outline the proposed financial policies of the City for the ensuing fiscal year, describe the important features of the budget, indicate any major changes from the current year in financial policies, expenditures, revenues or financial position, together with the reasons for such changes, summarize the City's debt position, and include such other material as the City Manager deems desirable;

D. Comprehensive Financial Plan. The budget shall provide a complete financial plan of all City funds, agencies and activities for the ensuing fiscal year and shall be in such form as the City Manager deems desirable or that the Council may require. The budget shall begin with a clear general summary of its contents; shall show in detail all estimated revenues of all funds and agencies; all carry-over fund balances and reserves; and all proposed expenditures, including debt service, for the ensuing fiscal year. The budget shall contain sufficient salaries to provide a comprehensive and consolidated view of the city's financial position;

E. Contents of Budget. Sections of the budget shall contain:

1. The proposed goals and objectives and appropriations for current operations during the ensuing year, detailed for each fund by organization unit, and program, purpose or activity, and the method of financing such proposed appropriations;

2. Comparative amounts for actual and estimated income and expenditures for the current fiscal year and actual income and expenditures for the preceding fiscal year;

3. Proposed capital expenditures during the ensuing fiscal year, detailed for each fund by organization unit when practicable, and the proposed method of financing each such capital expenditure; and

4. Anticipated income, expense, profit, loss, and reserves, and the purpose of said reserves, for each utility and enterprise fund;

F. Overexpenditures Prohibited. The total of proposed expenditures shall not exceed the total of estimated revenues plus carried forward fund balance, exclusive of reserves, for any fund;

G. Budget Adoption. The Council shall adopt the annual budget by affirmative vote of at least 3 members, on or before the last working day of the last month of the current fiscal year. If it fails to adopt the budget by this date the budget proposed by the City Manager shall be deemed adopted;

H. Supplemental Appropriations. Prior to the City Council making any supplemental appropriation the City Manager shall certify that monies in excess of those estimated in the budget are available for appropriation. Any such supplemental appropriation shall be made for the fiscal year by resolution up to the amount of any excess;

I. Emergency Appropriations. A process shall be devised by which the Council can, by four-fifths vote only, make emergency appropriations to respond to a public emergency affecting life, health, public welfare, property or the public peace;

J. Appropriations Reductions. Appropriations may be reduced any time during the fiscal year by the Council or City Manager if it appears probable to either that the revenues or fund balances available will be insufficient to finance the expenditures for which appropriations have been authorized. When appropriations are reduced the City Manager shall report to the Council at its next meeting, indicating the estimated amount of the deficit, any remedial actions taken, and recommendations as to any other steps to be taken;

K. Budgetary Transfers. The City Manager may transfer monies between departments and divisions, and programs and accounts within departments and divisions, but only the Council by resolution may transfer monies between funds and from unappropriated balances or fund balances to any fund or appropriation account. All such transfers made by the City Manager shall be reported in writing quarterly to the Council;

L. Lapse of Appropriations. All appropriations, except for capital expenditures, shall lapse at the end of the fiscal year to the extent that it has not been expended or encumbered. An appropriation for a capital expenditure shall continue in force until expended, revised, or repealed. The purpose of any such capital appropriation shall be deemed abandoned after 3 years pass without disbursement from or encumbrance against the appropriation;

M. Capital Improvement Plan. A capital improvement plan and budget encompassing 5 or more years shall be prepared and presented, or updated, by the City Manager and presented to the Council each year. The capital improvement plan shall include:

1. A general summary of its contents;

2. A list of all capital improvements and other proposed capital projects which are proposed to be undertaken during the term of the capital improvement plan, with appropriate supporting information as to the necessity for each proposed project or acquisition;

3. Cost estimates and recommended time schedules for each improvement or other capital expenditure;

4. Method of financing for each proposed capital project;

5. The estimated annual cost of operating and maintaining the facilities to be constructed or acquired;

N. Capital Plan Adoption. The Council shall adopt the capital improvement plan by resolution on or before the beginning of the first fiscal year covered by the plan;

O. Public Document. Copies of the annual budget, annual financial report, the capital improvement plan, and all appropriate summarizing documents, shall be made available to the public for inspection and review;

P. Public Hearing Required. Each of the annual budgets in the capital improvement plans shall be the subject of a public hearing before the City Council. Ten days' posted notice shall be provided for said hearing;

Q. Two Year Budget. A 2-year operational budget may be substituted for the required annual budget, in which case the budget shall be prepared and presented in 2 annual increments and all uses of the term "annual" in this Section may be revised by ordinance to permit the creation of the 2-year budget;

R. Quarterly Reports. Within 30 days after the end of each quarter during the fiscal year, and more often if required, the City Manager shall submit to the Council a financial and management report showing the relation between budgeted and actual revenues and appropriations, expenditures and encumbrances to date.

The City by ordinance or resolution may issue all manner of securities and incur all manner of indebtedness, but within the following limits:

A. General Obligation Bond Limit. Indebtedness of the City as evidenced by issued general obligation bonds shall at no time exceed 10 percent of the assessed valuation of all property taxable by the City;

B. Other Debt Limit. Indebtedness of the City other than voted general obligation bonds shall at no time exceed 10 percent of the assessed valuation of all property taxable by the City;

C. Definition and Exemption. The term "indebtedness" as used in subsections A and B of this Section shall not include bonds or other obligations denoting indebtedness which are issued for the purpose of financing or refinancing the acquisition, construction, or completion of public improvements or projects, the payment of which is not a general obligation of the City, and which is secured by a lien upon or levy of a special tax on real property within an identified district.

The City Council shall designate a depository or depositories for City monies and shall provide for the regular deposit of City monies therein The Council shall require such security for City deposits as it deems desirable and as is authorized or permitted by law, except that personal surety bonds, of themselves, shall not be deemed proper security.

The City Council shall by ordinance provide for the following, which procedures shall comply with state law unless the ordinance specifies otherwise:

A. Petty Cash. The creation and administration of petty cash funds;

B. Claims and Demands. Claims and demands against the City;

C. Warrants and Checks. Issuance and redemption of warrants and the use of checks drawn on the City treasury; and

D. Actions. Actions against the City.