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and the City's General Plan, the City recognizes costs as they accrue, and sets money
<br /> aside to fund the future expenditures, rather than allowing these costs to accumulate
<br /> and become a future financial burden.
<br /> Retirees Medical Reserve Fund. The FY 2017/18 actual revenues and expenditures
<br /> reflect the 2017 OPEB actuarial study recommendations, implied retiree medical
<br /> subsidy calculation (Implied Subsidy), the 2003 COP Golf debt repayment6 and actual
<br /> retiree medical payments. As shown in Table 10 below, the actual expenditures to the
<br /> Retiree Medical Reserve Fund are $950,627 less than budgeted. $695,000 of that is the
<br /> Implied Subsidy and the remaining $255,627 is related to unused retiree medical
<br /> benefits.
<br /> Table 10. Retirees Medical Reserve Funds - Amended Budget vs. Actual
<br /> FY 2017/18 FY 2017/18
<br /> Retiree Medical Reserve Fund Midyear Actual Variance Variance
<br /> Beginning Fund Balance $20,310,571 $20,310,571 $0 0%
<br /> Plus Revenues 5,091,968 5,150,533 58,565 1%
<br /> Less Net Transfers (61,000) (61,000) - 0%
<br /> Less Expenditures (4,993,000) (4,042,373) 950,627 -19%
<br /> Ending Fund Balance 20,348,539 21,357,731 1,009,192 5%
<br /> Change in Fund Balance $37,968 $1,047,160 $1,009,192 2658%
<br /> Replacement/Renovation Funds. In accordance with the City's financial policies and
<br /> the General Plan, the City maintains various Replacement/Renovation Funds. The
<br /> purpose of these funds is to provide ongoing replacement of City equipment, vehicles,
<br /> traffic signals, streetlights, and to make major repairs/renovations to City facilities,
<br /> parks, and medians, in order to extend their useful lives.
<br /> Table 11 presents the activity in FY 2017/18 in these funds. As described in Table 11,
<br /> the Repair and Replacement funds spent $3.6 million less than anticipated in FY
<br /> 2017/18. All of this $3.6 million will remain in the Repair and Replacement funds to be
<br /> expended on projects and equipment replacements in the future.
<br /> 6 The implied subsidy of$695,000 for Retiree Medical expenses is included as an expense in the Retiree
<br /> Medical Reserve Fund that is recovered through charges to departments. The $695,000 implied subsidy,
<br /> which is not an additional expense, is used to repay the Retiree Medical Reserve Fund that the City used
<br /> to pay off the 2003 Golf Fund debt.
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