HomeMy WebLinkAboutR-1996-063 Finance / Line of Credit (loan) neighborhood Development Svcs.RESOLUTION NO. R-96- G3
A RESOLUTION authorizing an Interfund Line of Credit (Loan) from 000 -General
Fund to the 124 -Neighborhood Development Services Fund, and
providing for repayment.
WHEREAS, 000 -General Fund has sufficient resources available for
investment to make the Interfund Line of Credit (Loan) authorized by this resolution;
and
WHEREAS, in order to provide sufficient capital to cover short-term cash flow
needs for the Office of Neighborhood Development this General Fund line of credit is
necessary; and
WHEREAS, the City Council deems it to be in the best interest of the City to
make the Interfund Line of Credit (Loan) provided for herein, now, therefore,
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF YAKIMA:
The amount of up to $400,000 is hereby authorized in the 000 -General Fund as
needed to cover cash flow requirements in the 124 -Neighborhood Development
Services Fund. The Director of Finance and Budget is hereby directed to take
administrative steps necessary to accomplish the Line of Credit (Loan) authorized by
this resolution and determine if reasonable interest should be charged.
ADOPTED BY THE CITY COUNCIL this 21st day of May, 1996.
ATTEST:
City Clerk
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BUSINESS OF THE CITY COUNCIL
YAKIMA, WASHINGTON
AGENDA STATEMENT
Item No. J 6'
For Meeting Of 5/21/96
ITEM TITLE: Resolution Authorizing Interfund Line of Credit (Loan)
SUBMITTED BY: Office of Finance and Budget and
Office of Neighborhood Development Services
CONTACT PERSON/TELEPHONE: John R. Hanson, Director/575-60
Cindy Epperson, Accountant/577CI
SUMMARY EXPLANATION:
The Office of Neighborhood Development Services is primarily funded through federal
and state grant applications. These resources are called reimbursable grants. This means
that program funds need to be expended prior to being reimbursed by the granting agency.
Although the staff schedules the draws as close to the expenditures as possible, there could
be a time lapse between the two actions. There may also be a lag between the time of
request and actual reimbursement. This gap, which creates a short-term cash deficit in the
Neighborhood Development Fund, is now informally covered by General Fund.
This is not a request to expand the use of General Fund revenue, but rather to authorize an
interfund line of credit from General Fund to the City of Yakima Office of Neighborhood
Development Services to cover the time lapses between expenditures and
reimbursements.
(Continued ) L
Resolution X Ordinance Contract Other (Specify)
Funding Source --�
.
APPROVED FOR SUBMITTAL:
City Manager
STAFF RECOMMENDATION: Pass Resolution
BOARD/COMMISSION RECOMMENDATION:
COUNCIL ACTION:
JH -- Agenda - LOC
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Because interest expense is unallowable to be reimbursed by grant resources, the
Resolution gives the Director of Finance and Budget the authority to determine the '
interest. At this point, we do not anticipate charging interest -- General Fund has the
authority to make interest-free loans.
This interfund line of credit was suggested by the State Auditor's Office in discussions on
the 1994 City audit. This resolution formalizes the practice of covering temporary cash
flow shortages caused by reimbursable grants in the Neighborhood Development Fund by
using General Fund resources.
JH -- Agenda - LOC
2 -- 5/16/96