Agenda Item Wording:
title
General Fund Surplus Policy – Review current General Fund surplus policy and consider making revisions to the policy.
body
Agenda Date: 10/19/2026
Prepared by:
Renee Nagel, Finance and Technology Director,559-713-4375, Renee.Nagel@visalia.gov, Amee Swearingen, Budget Analyst, 559-713-4170, Amee.Swearingen@visalia.gov
Department Recommendation:
Review current General Fund surplus policy and provide direction for revisions to the policy to be effective for FY 25/26, for future fiscal years, or to leave as is Council’s current policy.
Summary:
On April 20, 2026, staff presented to Council the Mid Cycle Budget report which included updated projections for FY 2025/26 for the General Fund. During the presentation, staff reviewed the current surplus policy and was directed to come back to Council for further discussion on possible revisions to the surplus policy.
Background Discussion:
The current General Fund emergency reserve and surplus policy was amended in March 2024. The policy states that any revenues, in excess of actual expenditures, would first be deposited in the emergency reserve to maintain the reserve at a maximum of 30% of operating expenditures and then all remaining surplus is to be deposited into the Civic Center Reserve Fund. The surplus policy also states that all one-time monies and land sales not otherwise required to be allotted to specific funds, will be deposited in the Civic Center Fund. Staff has presented the policy to Council to make potential changes in July 2025 and April 2026. At that time Council elected to not make any changes to the policy, and directed that the policy be brought back prior to the transfer of the surplus funds for 2025-26 fiscal year.
The 2025/26 year-end surplus is projected to be anywhere from $3-5 million. The surplus number is not finalized until the audit is complete. This amount is then transferred into the designated fund.
As of June 30, 2026 the Civic Center Reserve ...
Click here for full text