25LINKBUDGET(FULL) - Flipbook - Page 148
The Budget Stabilization Fund was established by ordinance on July 1, 1991,
pursuant to Public Act 30 of 1978, as amended, for the purpose of setting aside
a reserve to meet unanticipated expenditure needs, unanticipated revenue
shortfalls, or other emergencies.
The statute allows a maximum amount to be placed in the Budget Stabilization
Fund equal to 15% of the General Fund or, approximately $1,392,176. A
generally accepted fund balance reserve recommended by many auditing
firms, financial consultants and bond rating agencies is 10% to 20% of the
General Fund, which would be approximately $928,117 to $1,856,235 for the
City of Plymouth.
In addition, the maintenance of a General Fund balance reserve is a positive
factor in obtaining a good bond market rating. The City's ordinance
establishing this fund is presented on the next two pages.
-102BUDGET STABILIZATION FUND
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