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11/16/2021 04.W. Ordinance Creating Custodial Fund 633 and adding Municipal Code Section 3.126 (second reading) • rr 11 i 14.41141 ( i�O enc u nrry 1 BUSINESS OF THE CITY COUNCIL YAKIMA, WASHINGTON AGENDA STATEMENT Item No. 4.W. For Meeting of: November 16, 2021 ITEM TITLE: Ordinance Creating Custodial Fund 633 and adding Municipal Code Section 3.126 (second reading) SUBMITTED BY: Jennifer Ferrer-Santa Ines, Director of Finance and Budget Kimberly Domine', Financial Services Manager SUMMARY EXPLANATION: The attached Ordinance authorizes the establishment of a"Custodial Fund" to account for the resources that are held by the City of Yakima in a purely custodial capacity. This fiduciary fund will allow for separate accountability of these resources as required by the new GASB Statement 84. ITEM BUDGETED: NA STRATEGIC PRIORITY: Public Trust and Accountability APPROVED FOR SUBMITTAL BY THE CITY MANAGER RECOMMENDATION: Pass Ordinance ATTACHMENTS: Description Upload Date Type ❑ Ordinance 10/21/2021 Ordinance Memo 10/21/2021 Corer Memo 2 ORDINANCE NO. 2021- AN ORDINANCE authorizing the establishment of a Fiduciary Fund 633 "Custodial Fund"to account for the monies collected on behalf of another agency and adding Municipal Code Section 3.126. WHEREAS, the City of Yakima needs the creation of a new fund in order to implement the new GASB 84 standard concerning fiduciary accounts ; and WHEREAS, the City has several accounts that fall into the definition of a fiduciary custodial account such as Leasehold Excise Tax, State Building Code Surcharges, Sales Tax Payable, etc. ; and WHEREAS the City desires to establish a new fiduciary fund entitled "Custodial Fund"for the purpose of combining all accounts into one fund for the ease of compliance and reporting; and WHEREAS City Staff has determined that creating a Fiduciary Fund 633 is in the best interest of the City of Yakima; now, therefore, BE IT ORDAINED BY THE CITY OF YAKIMA: Section 1. The City Council does hereby incorporate the above "whereas" recitals as findings in support of this ordinance to establish a separate Fiduciary Fund to account for the various custodial activity into one fund. Section 2. There is hereby added a new City of Yakima Municipal Code Chapter 3.126, which establishes the Custodial Fund for the purpose of combining all custodial activity into one fund of the City of Yakima. 3.126 Custodial Fund. A. There is created the Custodial Fund. B. The Custodial Fund shall consist of monies collected on behalf of another entity, and disbursed to the appropriate entity at the required time. 3 This ordinance is creating a new Fund 633 and adopting City of Yakima Municipal Code Chapter 3.126, which establishes the Custodial Fund and shall take effect immediately upon its passage, approval and publication as provided by law and by the City Charter. PASSED BY THE CITY COUNCIL, signed and approved this 16th day of November, 2021. Patricia Byers, Mayor ATTEST: Sonya Claar Tee, City Clerk First Reading: November 1, 2021 Publication Date: Effective Date: 4 3:1 • FINANCE TO: Mayor and City Council FROM: Jennifer Ferrer-Santa Ines, Director of Finance and Budget Kimberly Domine', Financial Services Manager DATE: October 21, 2021 RE: Ordinance Creating Custodial Fund 633 and adding Municipal Code Section 3.126 The Governmental Accounting Standards Board came out with GASB Statement 84, Fiduciary Activities for purposes of accounting and financial reporting. It focuses on whether a government is controlling the asset and the beneficiaries with whom the relationship exists. A custodial fund typically involves the collection of receipts and remittance of the fiduciary resources to individuals, private organizations or other governments. The attached Ordinance authorizes the establishment of an "Custodial Fund" to account for the resources that are held by the City of Yakima in a purely custodial capacity. This fiduciary fund will allow for separate accountability of these resources as required by the new GASB Statement 84.