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3 <br /> As best practice, local governments should only appropriate fund balance for non-recurring <br /> purposes such as capital. While it is preferable to be able to achieve the fund balance goal in <br /> order to meet needs in time of fiscal stress, the use of the fund balance to meet non-recurring <br /> priorities is understandable. It would be prudent to not let the fund balance fall below 11% in <br /> order to provide for cash flow as well as maintaining the County's excellent bond rating. Once <br /> funding the shortfall is completed, it is recommended steps be taken to rebuild the fund balance <br /> of the General Fund. <br /> FINANCIAL IMPACT: The financial impact of the recommended action is the projected <br /> reduction of the fund balance of the General Fund to as low as 11.1% of projected FY 2009-10 <br /> expenditures. <br /> RECOMMENDATION(S): The County Manager recommends the Board approve the two year <br /> funding plan which includes 1) Appropriating $3.5 million from the fund balance of the General <br /> Fund for transfer to the School Capital Project Fund and County Capital Project Fund; 2) <br /> Include the remaining appropriation of $2.4 million from the fund balance of the General Fund <br /> needed to complete the correction of the shortfall in the Fiscal Year 2009-10 budget; and 3) <br /> Direct staff to take those actions necessary to reallocate available funding to correct the project <br /> shortfalls and to bring back to the Board the budget amendments necessary to implement this <br /> plan. <br />