FILE:  DCF

Cf:  DC

 

GENERAL FUND RESERVE

 

 

SCOPE AND DEFINITIONS

 

The General Fund Reserve policy applies to reserves in the general fund only, and not any other funds of the Bossier Parish School Board.  Within this policy, reserves are defined as the excess of assets over liabilities in the general fund.  Reserves shall be categorized as:

 

  1. Non-spendable (in form)

  2. Restricted (limitations on use imposed by third parties)

  3. Committed (imposed by the Bossier Parish School Board on itself by formal action at its highest level of decision making authority, which is by duly adopted resolution)

  4. Assigned (imposed by the Bossier Parish School Board on itself to earmark fund for an intended use, usually by a majority vote of School Board members present)

  5. Unassigned (residual fund balance remaining after considering the other four categories)

 

PURPOSE

 

The purpose of the General Fund Reserve policy shall be to:

 

  1. Plan for contingencies, such as natural disasters, unpredicted one-time large expenditures, revenue shortfalls, or other events or service needs that were unanticipated during budget development;

  2. Provide stability and flexibility to respond to unexpected adversity or opportunities;

  3. Maintain good standing with bond rating agencies;

  4. Avoid interest expense by building reserves and then using them for intended purposes or to cover short-term cash shortfalls;

  5. Generate investment income by investing reserves; and

  6. Ensure cash is available to sustain services when revenues are unavailable.

 

RESERVE TARGET LEVELS

 

The Bossier Parish School Board shall maintain unassigned general fund reserves of 12% of general fund budgeted expenditures and is committed to an unassigned general fund reserve target of 15%.

 

FUNDING AND REPLENISHING THE TARGET AMOUNT

 

Funding of the general fund balance target will generally come from excess revenues over expenditures and 3% of increased collections from ad valorem taxes renewed to the original millage rates.

 

AUTHORITY OVER RESERVES

 

The School Board maintains authority over fund balance reserves and approves both the assignment and use of reserves.  The Superintendent shall be responsible for monitoring reserve levels and reporting results of operations, including a statement of revenues and expenditures periodically throughout the year.

 

New policy:  March 17, 2016

 

 

Ref:    La. Rev. Stat. Ann. ยงยง17:88, 17:89, 17:89.1, 39:1304

Board minutes, 3-17-16

 

Bossier Parish School Board