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ATTACHMENT 4 4. The use of reserves shall be approved by the City Council through a resolution or budget adoption. The City Manager shall have the authority to approve the appropriation of Reserve Funds to respond to an emergency situation. The City Manager will then take a resolution to the City Council at its next regularly scheduled meeting confirming the nature of the emergency and formally authorizing the appropriation of reserve funds. Replenishment of Reserves If the General Fund reserve level falls below 16.7%, the goal is to replenish the reserve within three fiscal years. For the Water and Sewer Enterprise Fund reserves, if either reserve level falls below 30.0%, a rate study will be required to be completed in 12 months or less that provides a roadmap to replenish the impacted reserve over the next three fiscal years. Excess Fund Balance If actual reserve balances exceed the level required by the reserve policy at year end, the surplus funds shall remain in the reserve until allocation by the City Council for the following purposes.- 1. urposes:1. Use of General Fund excess balance shall not be used for new recurring expenses. 2. Transfer to the CIP Fund for general capital needs and/or extensive capital maintenance or improvement projects. For example, funding major replacement or renovation projects to maintain or enhance city infrastructure. 3. Re-appropriation within the subsequent year's operating budget to fund any one- time expenditures/projects based on City Council direction. For example, pre- funding the City's pension and retiree health liabilities and setting aside funds for a pilot program. Annual Reporting and Periodic Review The Finance Director shall report the year-end budgetary fund balance to the City Council as part of the annual budget report. The reserve policy shall be reviewed annually, and modifications are subject to Council approval. City of Pleasanton Reserve Policy