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HomeMy WebLinkAboutOrdinance No. 2970-2017CITY OF KENAI ORDINANCE NO. 2970-2017 Suggested by: Administration AN ORDINANCE OF THE COUNCIL OF THE CITY OF KENAI, ALASKA, INCREASING FISCAL YEAR 2017, GENERAL FUND, AIRPORT FUND, WATER & SEWER FUND, PERSONAL USE FISHERY FUND, AND CONGREGATE HOUSING FUND ESTIMATED REVENUES AND APPROPRIATIONS FOR THE TRANSFER OF FUNDS TO ESTABLISH THE NEW EMPLOYEE HEALTH CARE INTERNAL SERVICE FUND WHICH SHALL BE UTILIZED FOR ADMINISTERING EMPLOYEE HEALTH CARE BEGINNING IN FISCAL YEAR 2018, JULY 1, 2017. WHEREAS, the adopted FY2018 Annual Budget for the City included a new fund for the administration of employee health care benefits; and, WHEREAS, the newly established fund will be an internal service fund; and, WHEREAS, an internal service fund is utilized to finance, administer and account for departments or agencies of a government whose exclusive or nearly exclusive purpose is to provide goods or services to the government's other departments on a cost -reimbursement basis; and, WHEREAS, initial capitalization of the fund is based on each City Fund's current staffing which is eligible for employee health care; and, WHEREAS, the City's General Fund, Airport Fund, Water & Sewer Fund, Personal Use Fishery Fund, and Congregate Housing Fund have positions eligible for coverage; and, WHEREAS, Council created a $100,000 commitment of General Fund, Fund Balance when adopting the FY2017 City Budget for future employee health care costs; and, WHEREAS, appropriating and transferring the $100,000 is consistent with the adoption of the FY2018 Budget and is consistent with the intent of the FY2017 commitment of Fund Balance. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA: Section 1: Form: That this is a non -code ordinance. Section 2: That estimated revenues and appropriations be increased as follows: General Fund Increase Estimated Revenues - Appropriation of Committed Fund Balance $10"0 Increase Appropriations: Non -Departmental — Transfer to Employee Health Care Internal Service Fund $100 0OQ Airport Fund New Text Underlined; [DELETED TEXT BRACKETED] Ordinance No. 2970-2017 Page 2 of 3 Increase Estimated Revenues - Appropriation of Fund Balance $7.437 Increase Appropriations: Airport Administration — Transfer to Employee Health Care Internal Service Fund $7 437 Water & Sewer Fund Increase Estimated Revenues - Appropriation of Fund Balance $8 501 Increase Appropriations: Water — Transfer to Employee Health Care Internal Service Fund $8 501 Personal Use Fishery Fund Increase Estimated Revenues - Appropriation of Fund Balance $1 151 Increase Appropriations: Parks, Recreation & Beautification — Transfer to Employee Health Care Internal Service Fund $1.151 Congregate Housing Fund Increase Estimated Revenues - Appropriation of Retained Earnings $548 Increase Appropriations: Congregate Housing — Transfer to Employee Health Care Internal Service Fund $54$ Section 3. Severability: That if any part or provision of this ordinance or application thereof to any person or circumstances is adjudged invalid by any court of competent jurisdiction, such judgment shall be confined in its operation to the part, provision, or application directly involved in all controversy in which this judgment shall have been rendered, and shall not affect or impair the validity of the remainder of this title or application thereof to other persons or circumstances. The City Council hereby declares that it would have enacted the remainder of this ordinance even without such part, provision, or application. Section 4. Effective Date: "That pursuant to KMC 1.15.070(f), this ordinance shall take effect upon enactment. The appropriation and transfer shall be made effective June 30, 2017 and shall be considered an action of Fiscal Year 2017. New Text Underlined; [DELETED TEXT BRACKETED] Ordinance No. 2970-2017 Page 3 of 3 ENACTED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA, this 511 day of July, 2017. i8Z-- BRIAN GABRIEL SR., MAYOR ATTEST: j Approved by Finance_ Introduced: June 21, 2017 Enacted: July 5, 2017 Effective: July 5, 2017 New Text Underlined; [DELETED TEXT BRACKETED] AF r '7/lla� t, _-_-_ - 210 Fidalgo Ave, Kenai, Alaska 99611-7794 Telephone: (907) 283-7535 1 Fax: (907) 283-3014 \the ci'yo f www. kenai.city \V MEMORANDUM TO: Mayor Brian Gabriel and Kenai City Council THROUGH: Paul Ostrander, City Manager FROM: Terry Eubank, Finance Director y� DATE: June 14, 2017 SUBJECT: Ordinance 2970-2017 The purpose of this memo is to respectfully recommend adoption of Ordinance 2970-2017. Ordinance 2970-2017 will appropriate the transfer of funds from each of the City's operating funds, the General Fund, Airport Fund, Water & Sewer Fund, Personal Use Fishery Fund, and the Congregate Housing Fund, to a new Internal Service Fund for the administration of employee healthcare benefits. Each of the funds have authorized positions which are eligible for employee healthcare benefits. Transfer amount for each fund was based on each funds' FY18 budgeted participation rate in the program. Participation by Senior Citizen Fund employees was included with the General Fund amounts for the calculation. Internal Service Funds are established to finance, administer, and account for departments or agencies of a government whose exclusive or nearly exclusive purpose is to provide goods or services (e.g. printing services) to the government's other departments on a cost -reimbursement basis. The Administration believes the use of an Internal Service Fund will reduce the budgetary impact of annual changes in health care costs. With the adoption of the FY2017 Budget, Council committed $100,000 for future employee healthcare costs. This $100,000 of committed fund balance is the source of funding for the General Fund's portion of the internal service fund's initial capitalization. Adoption of Ordinance 2970-2017 is the final step in the FY2018 Budget plan to create and utilize an internal service fund for administration of employee healthcare at the City. Your support is respectfully requested.