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BOCC Approved <br />10/21/2008 <br />School Districts Local Current Expense Fund Balance Policy <br /> <br />Joint Policy Between <br />Orange County Board of County Commissioners <br />Chapel Hill Carrboro City Schools Board of Education <br />Orange County Schools Board of Education <br /> <br />1. Guidelines <br /> <br />The School Budget and Fiscal Control Act (SBFCA) establishes accounting, <br />budgetary and fiscal control guidelines for School Systems. The SBFCA is <br />codified in G.S. Chapter 115C, Article 31, beginning at G.S. 115C-422. This <br />act parallels the statutes established for Local Government with a few <br />exceptions. <br /> <br />2. Definitions <br /> <br />2.1. Total Fund Balance – The difference between a school system’s total <br />assets and its total liabilities at the end of the fiscal year. <br /> <br />2.2. Fund Balance Available for Appropriation – The sum of a school system’s <br />assets held in cash and investments minus the sum of the school system’s <br />liabilities and encumbrances at the end of the fiscal year as outlined in G.S. <br />115C-425 of the SBFCA. <br /> <br />2.3. Designated Fund Balance – The amount of the available fund balance that <br />has been appropriated for the budget year through budgetary action of the <br />School Board. <br /> <br />2.4. Undesignated Fund Balance - The difference between Fund Balance <br />Available for Appropriation and Designated Fund Balance. <br /> <br /> <br />3. Policy <br /> <br />3.1. Fund Balance for Cash Flow Purposes – Each school district will make a <br />good faith effort to maintain a level of undesignated fund balance that will <br />ensure sufficient funds are available to address its cash flow needs. The <br />following levels are to be maintained for cash flow purposes only: <br />3.1.1. Chapel Hill Carrboro City Schools - The targeted level of <br />undesignated fund balance for cash flow purposes will be at a <br />minimum of 5.5 percent of budgeted expenditures. <br />3.1.2. Orange County Schools – The targeted level of undesignated fund <br />balance for cash flow purposes will be at a minimum of 3 percent of <br />budgeted expenditures.