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ORANGE COUNT y* C (OPY <br /> HILLSBOROUGH <br /> NORTH CAROLINA <br /> ✓y .�� 1'artaG�ielee�G>7�52 <br /> MEMORANDUM <br /> TO: Orange County Board of Commissioners <br /> John Link, County Manager <br /> FROM: 0/10 d Visser, Assistant County Manager <br /> DATE: June 18, 1999 <br /> RE: New Hope Fire Department Budget <br /> Cliff Carroll dropped by yesterday with a set of answers to the questions previously posed to New Hope Fire <br /> Department concerning their 1999-2000 budget request. A copy of New Hope's answers is attached to this <br /> memo, along with our June 9 letter. <br /> F,)fL a'G,vc <br /> vi. <br /> Cliff and I met and discussed some additi onal informatid'n+.6out New HoCpe's i aYal condition. As Cliff <br /> li. nEc.. <br /> explained the other night,the depament,rlans to eater uSto lease agreemtt orsornewhere between$385,000 <br /> - $405,000, with a ten year pay t`bacr��d and annual debt payments of$4�7A0 !' hey are acquiring two <br /> 7 '( h Y.c Ir Jrr. }JS- j�, t L {9 !t f ,f 1 f So'. <br /> new trucks with a total cost ofof 5(iQDO�;ade cor3plrngxanddirtiKko� aton 1 on Whitfield Road, <br /> with a pricetag of about$250,Qdt�f Gfxrff tells#ttey i ark�sse ifially lann�rxg to,pa i h for the building <br /> addition, and hope to reduce tl ,laeam�it�npt�aFs much a��'os��tile by`us��'���dfXgn����sh reserves as a down <br /> "sk-r `5 i r x x�C+u�-s`'rr^F'r s t` ) „ + s"•i ^7t!'""siwy�;zc EZ"i ro <br /> on the two trucks w s�j5== G , < < _� ,{f e , C4 <br /> payment Z n _(,°1 t { e EjrF 7 �Gzw <br /> 12R rk fit G �* x 1 •x • 1 Fig 3,1Y' 4 <br /> N'S +.tC3 1im 'bs�d�,is:�1 <br /> '". ;)- z rr rn'ya <br /> 1�( STS 3;r L�✓t"+h t 4} hYY� 4 �� r+'-1". ,l r�l�. i�`JU��Y'.�)1(� ry�' 4 M4)',jV Vie' <br /> I think it is important to distingni{sh betven tlercasli reserv�sa our wl licx � eax; xient exercises complete <br /> control, and fund balance, which thd'05ur t coat ols anal"vvhid. is!apprtipr" ated'onAy with Board of <br /> Commissioner approval. Each year,tax receipts for New Hope (and most departments)tend to exceed budget <br /> estimates by anywhere from a few hundred to a few thousand dollars. These extra revenues become additions to <br /> fund balance. They are invested by the Finance Director and are accounted for in the Fire Districts Fund on <br /> behalf of the individual fire districts. We are projecting that New Hope's available fund balance at the end of <br /> June 1999 will be in the neighborhood of$10,000. <br /> The cash reserves that New Hope (and other departments) accrues are maintained in their own departmental <br /> bank accounts. As best I can determine,these reserves are built in two ways: <br /> 1) from programmed contributions to a capital reserve account for major capital equipment replacement. This <br /> is a prudent approach to capital budgeting in general, although there is always room for discussion about <br /> how much of an annual contribution is necessary and appropriate. You may have noted from New Hope's <br /> budget request that they programmed$19,500 to capital reserve in 1997-98, $14,000 in 1998-99, and <br /> propose to program $15,000 in 1999-2000. <br /> AREA CODE (919) 732-8181 . 968-4501 ® 688-7331 0 227-2031 ® FAX (919) 644-3004 <br /> Ext. 2300 <br />