Purpose

 
The purpose of the Township's reserve funds are to provide 1) a stable funding source for expenditures that fluctuate significantly each year, for example equipment acquisitions and replacements, 2) working capital to maintain a sufficient cash flow, and 3) a stable or improved credit rating. 
 

Policy

 
The Township's goal is to maintain a General Fund fund balance reserve of 45% of the General Funds operating budget for working capital to provide cash flow between its two semi-annual state aid and tax payments (July and December).

At the end of the fiscal year, if the General Fund fund balance has a reserve for working capital at a minimum balance of 45% of next year's operating budget the remaining reserves will be designated for a specific use or transferred to other funds for the funding of future improvement projects, equipment purchases or into the risk management fund to self-insure Township assets as approved by the Town Board.

The Miscellaneous Bond Fund will receive any fund balances remaining in any debt service fund once the debt is fully retired.

Excess balances in Capital Project Funds will be used to reduce debt issues or be used to fund future capital projects. Fund balances in these funds will fluctuate based on the timing of funding sources and expenditures.

Enterprise Funds shall maintain a fund balance to help finance infrastructure replacements and the addition of new capital facilities, such as, wells, water towers, or lift stations.