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staff would estimate revenues and match expenditures operationally as to what that stream is to sustain services. Regarding a longer term approach, staff conducts afive-year forecast of revenues and expenditures and analysis is presented with each operating budget. As part of the General Plan later this year, staff will do a longer term fiscal analysis, measure the impact of new land uses in the City, identify potential revenue streams and necessary service levels to sustain programs and activities of the City through build-out. Councilmember Sullivan said some adjustments have been reductions in some of the reserve funds. He recommended staff quantifying this over the last few years and in moving forward, to monitor balances as they are depleted. Regarding the CIP, Councilmember Sullivan said the City has been fortunate in the amount of projects funded and built over the last 10-12 years and he questioned when the City would start to be more frugal and scrutinize some projects more closely. City Manager Fialho said this was the first time in a long time the City has seen such a slowing of revenue, said the City is approaching build-out and maturing as a community, and he thinks the City will require less new facilities in the City. The largest policy obligation is the Council's commitment to the Bernal property and seeing that built out over the next 17 years, which is based on the fiscal plan adopted last year. He said it begins with discussions during Council priority work sessions held annually in January and then the Council incorporates into the CIP. He agreed that Councilmember Sullivan's point was well-taken and acknowledged the many projects completed within budget, but agreed the work plan will slow. Vice Mayor Thorne echoed Councilmember Sullivan's comments about long-range planning, and he confirmed it was a part of the Council's work plan as well as its inclusion into the General Plan, and he confirmed with the City Manager Fialho that staff commissioned a long- term fiscal plan for presentation some time later this year. Councilmember McGovern said she wanted to keep long-term debit in the forefront, said GASB 45 requires cities to show their long-term debt and develop a plan, and wanted this discussion to occur sooner rather than later. She said there is a Pedestrian and Bicycle Committee looking at suggestions for bike lanes and confirmed the committee held a couple of meetings this year and are working towards developing a Bike Master Plan, which will identify long-term improvements. City Manager Fialho reiterated that every summer the City conducts overlay projects and the policy is for automatic installation of bike lanes for all major streets. Councilmember Cook-Kallio said it is clear that staff has done a good job anticipating positive and negative economic changes, noted some of the quiet zone issues involve unincorporated areas and she confirmed the study would identify who is responsible for those areas. Mayor Hosterman requested staff discuss the 10% set-aside and questioned if it was possible to pull monies together to address the shortfall without digging into the 10%. City Manager Fialho said by Council policy there are two reserves; an economic uncertainty reserve of a fixed amount of $6 million which grew; a second reserve is tied to the amount of revenue that comes into the City which is set at 10%. Therefore, because revenue has decreased by $4.5 million, the reserve balance will decrease by about $260,000. He said the City addressed the 10% set- aside by $1 million, so the balance actually grew by about $800,000. Mayor Hosterman confirmed with Mr. Culver that by approving the budget, the City was maintaining its 10% reserve. Regular City Council/ Library Board of Trustees Minutes 9 June 17, 2008