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2 <br /> • Use for natural disasters and emergencies <br /> • Cash Balance cushion <br /> S&P Scorecard (graph) <br /> Moody's Scorecard (graph) <br /> The Ten `AAA' Rated Counties of North Carolina (graph) <br /> General Obligation Bond Rating Scale (graph) <br /> Audited Unassigned Fund Balance as a Percent of Expenditures—General Fund (graph) <br /> Commissioner Dorosin asked if these numbers are considered by the rating agencies <br /> when rating the County. <br /> Gary Donaldson said yes. <br /> Commissioner Dorosin asked if the rating agencies consider the County's policy or the <br /> funds that the County actually has available, when conducting its review, and rating the <br /> County. <br /> Gary Donaldson said the agencies look at what is actually available; for example, if the <br /> policy is 17%, but the County exceeds it and has 18.5%, then the rating agency would <br /> consider the higher of the two numbers. <br /> Commissioner Price asked if the rating is conducted at a particular time of year. <br /> Gary Donaldson said the County is required to provide disclosures to the rating agency <br /> at the end of the fiscal year. He said a full review is done when a county issues bonds. <br /> Commissioner Jacobs asked if Gary Donaldson could identify the last time the County <br /> did not have an overage in its fund balance. <br /> Gary Donaldson said probably during the past recession. He resumed the <br /> presentation: <br /> Best Practice Unassigned Fund Balance <br /> ➢ In Summary <br /> • GFOA Recommends Unassigned Fund Balance at 2 Months of Expenditures or <br /> 16.7% <br /> • North Carolina AAA Rated County Peers Maintain at Least 2 Months; one <br /> exception <br /> • Strong Fund Balance provides Financial Bridge in Recession and Emergencies <br /> General Fund Cash flow (chart) <br /> Gary Donaldson said the low period for fund cash flow is usually during tax receipt <br /> timeframes. <br /> Commissioner Jacobs asked if there is a level of fluctuation in the fund balance that <br /> would cause the rating agencies to take action. <br /> Gary Donaldson said changes that are 2% or lower, and could be explained, would <br /> likely not result in action being taken. <br /> Commissioner Dorosin said Moody looks at a 5-year window. <br /> Gary Donaldson said when considering the broader picture, the County is looking to <br /> develop a 5-year plan, which the rating agencies favor. <br />