Unassigned Fund Balance
The Unassigned Fund Balance is defined as the spendable general fund dollars that are not allocated to other funds.
Bond rating agencies and others first look at a City’s unassigned Fund Balance to assess the fiscal health of that City and management of its finances. The more unassigned money available, the better the City’s ability to weather a financial downturn due to having cash-on-hand to address temporary budget shortfalls. It also means the City is less likely to enact short-term borrowing to address cash flow problems; saving the taxpayers interest costs. Having cash-on-hand also allows a municipality to invest money to address City needs, and can generate additional revenue through investments and interest earned.
In the FY13 Audit, the City’s General Fund Unassigned Fund Balance was a negative $2,178,623. In FY17, the General Fund Unassigned Fund Balance was a positive $8,403,087. This is a turn-around of over $10M.
These figures are determined by an Auditor who, after making all adjustments to the General Fund Balance Sheet, determines how much money is not obligated for any specific purpose and thereby is unassigned and available to be used as determined by a City’s Fund Balance Policy.