The Montevideo City Council  approved the 2012 city budget and levy Monday night with no changes from the Dec. 5 council meeting, nor from September when the preliminary budget was first approved.


The Montevideo City Council  approved the 2012 city budget and levy Monday night with no changes from the Dec. 5 council meeting, nor from September when the preliminary budget was first approved.

The final 2012 tax levy of $1,812,300 reflects a 5 percent increase over the 2011 tax levy.

The total general and special operating purposes levy, which includes the general fund, the library levy, and the Economic Development Authority, is $1,236,500. The levy includes a special levy for a tax abatement of $3,000, and total debt service levy of $572,800.

The council then passed a resolution adopting the budget for the 2012 fiscal year. The budget remains unchanged from the last council meeting, at which it was thoroughly discussed.

The budget projects revenues of $11,631,960 and expenditures of $11,631,960 and expenditures of $11,532,670.

In other business:
• Council approved a Fund Balance Policy to comply with the reporting guidelines specified in Governmental Account­ing Standards Board (GASB) Statement No. 54. The policy states the city shall classify governmental fund balances in its various funds in one or more of five classifications: nonspendable, restricted, committed, assigned and unassigned.

Jan Flaherty, city finance director, told council that there was no real change from the way the city currently handles its fund balances. She noted the one advantage would be when the city went to financial ratings firms such as Moody’s.

The policy specifies the city will strive to maintain a minimum unrestricted fund balance in the general and special revenue funds of approximately 35 percent to 50 percent of fund operating revenues, or no less than five months of operating expenditures. The idea is to provide adequate funds until the next property tax revenue collection, according to Flaherty.

The city fund balance was 44 percent last year.

Flaherty added that she had already taken the 2010 fund balances and restated them to comply with the new policy guidelines. The change will be reflected in the 2011 audit, she explained.