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CONSIDERATION OF ORDINANCE O-1819-10 UPON SECOND AND FINAL READING: AN ORDINANCE OF THE CITY OF NORMAN, OKLAHOMA AMENDING SECTION 8-103 OF THE CODE OF THE CITY OF NORMAN BY REDUCING THE REQUIRED PERCENTAGE OF ANNUALLY BUDGETED EXPENDITURES TO BE APPROPRIATED TO THE EMERGENCY RESERVE ACCOUNT FROM TWO PERCENT TO ONE PERCENT AND CHANGING THE MINIMUM AND MAXIMUM PERCENTAGE OF GENERAL FUND EXPENDITURES TO BE HELD IN THE NET REVENUE STABILIZATION FUND TO FOUR AND SEVEN PERCENT; AND AMENDING SECTION 8-104 TO INCREASE THE MINIMUM AMOUNT IN THE NET REVENUE STABILIZATION FUND FROM THREE PERCENT TO FOUR PERCENT OF ANNUALLY BUDGETED GENERAL FUND EXPENDITURES; AND PROVIDING FOR THE SEVERABILITY THEREOF.
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BACKGROUND: On June 28, 2011, the City Council adopted Ordinance O-1011-58, which formalized the City of Norman's General Fund Reserve Policies. The Ordinance was codified in Sections 8-103 - 8-104 of the City Code. Generally speaking, the Policy requires that the City Council adopt a General Fund budget each fiscal year that has an Operating Reserve of Fund Balance of at least three percent (3%) of budgeted expenditures, a budgeted Emergency Reserve allocation of at least two percent (2%) of budgeted expenditures and a minimum balance of at least three percent (3%) of General Fund expenditures in a Net Revenue Stabilization Fund (also known as the "Rainy Day Fund"), which was established by Ordinance 1011-58.
The Reserve Policy also sets restrictions before the Council can appropriate any funds from the Rainy Day Fund. At least one of three circumstances must be met before Council can appropriate Rainy Day Fund balances for expenditure:
1. The General Fund Operating Reserve fund balance is projected to fall below one percent of budgeted expenditures; or
2. A natural or man-made disaster has occurred, resulting in a federal or state disaster declaration in Norman, AND the City of Norman has spent or obligated to spend the two percent Emergency Reserve acc...
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