HomeMy WebLinkAboutOrdinance 5458 ORDINANCE NO. 5458
AN ORDINANCE TO ENACT §34.09 SALES TAX CAPITAL FUND OF
THE CODE OF FAYETTEVILLE
WHEREAS, the Government Accountings Standards Board sets general accounting
principles and requires that cities account for certain revenues by placing them in separate funds;
and
WHEREAS, the City Council has determined to recognize and establish a separate Sales
Tax Capital Fund.
NOW, THEREFORE BE IT ORDAINED BY THE CITY COUNCIL OF THE
CITY OF FAYETTEVILLE,ARKANSAS:
Section 1: That the City Council of the City of Fayetteville, Arkansas hereby enacts
§34.09 Sales Tax Capital Fund of the Code of Fayetteville as shown below.
"§34.09 Sales Tax Capital Fund
"(A) The Sales Tax Capital Fund is recognized and established
as a separate fund to be used exclusively for capital and capital
related projects and purchases as authorized and appropriated by
the City Council
(B) At least forty percent(40%) of the revenue derived from the
city one percent operating sales and use tax shall be deposited
into the Sales Tax Capital Fund in 2012. The City Council when
adopting budgets for 2013 and thereafter may lower this
minimum percentage for the Sales Tax Capital Fund, but not
below thirty-five percent (35%) for the Sales Tax Capital Fund
and not to exceed sixty-five percent(65%) for operations."
Page 2
Ordinance No. 5458
PASSED and APPROVED this 15th day of November, 2011.
APPROVED: ATTEST:
By: , By:
O ELD JO N, Mayor SONDRA E. SMITH, City Clerk/Treasurer
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City of Fayetteville Staff Review Form
City Council Agenda Items
and
Contracts, Leases or Agreements
11/1/2011
City Council Meeting Date
Agenda Items Only
Paul A Becker Finance and Internal Services Finance and Internal Services
Submitted By Division Department
Action Required:
This is a request for the City Council to formally establish the Sales Tax Capital Fund.This would allow the City to
continue to budget and report the Sales Tax Capital Fund in the City Financial Statements under newly defined
generally accepted accounting principles.
N/A $ "
Cost of this request Category/Project Budget Program Category/Project Name
Account Number Funds Used to Date Program/Project Category Name
Project Number Remaining Balance Fund Name
Budgeted Item Budget Adjustment Attached
Q, Previous Ordinance or Resolution#
Depart nt irector Date
Original Contract Date:
/()—/I- Original Contract Number:
ity Attorney Date
Finance and Internal Services Director Date Received in City 1 0-1 -1 1 P 01 4 7 R C V D
Clerk's Office
CHK of St Date
Received in
• Mayor's Office
Yor Dat
Comments:
Revised January 15,2009
•
Tae evl e THE CITY OF FAYETTEVILLE,ARKANSAS
DEPARTMENT CORRESPONDENCE
ARKANSAS
iyetteville.org
CITY COUNCIL AGENDA MEMO
To: Mayor Jordan and Members of the Fayetteville City Council
Thru: Don Marr, Chief of Staff
From: Paul A Becker, Finance Director P.A,6-
Date: October 17, 2011
Subject: Request for an Ordinance Formally Establishing The Sales Tax Capital Fund
Background:
The Governmental Accounting Standards Board (GASB) is the standard setting body for generally accepted
principles for governmental accounting (GAP).Once established these rules must be followed to receive an
unqualified opinion from a CPA firm on the City Financial Statements. In other words, they set the rules in the
world of governmental accounting.
The City of Fayetteville is required to have an annual audit performed under generally accepted accounting
principles by a CPA firm and an opinion rendered on the City's Financial Statements.
Periodically, the GASB establishes or changes accounting principles and/ or reporting requirements. This is
done through the issuance of GASB Statements. Recently GASB has issued Statement 54 which primarily
addresses a new classification method of funds balance, but also touches on what is required to establish and
account for separate funds.
Issues•
Since 1993 when the one cent sales tax was approved by the voters of Fayetteville, the portion of the City
sales tax used for capital and capital related projects has been accounted for and reported in a separate fund.
Although over the years the percentages allocated between general operations and capital has changed, the City
Council has continued to allocate a portion of the sales taxes collected to capital and capital related projects.
The current allocation is 60% to general operations and 40% to sales tax capital expenditures. In June of 2002 a
resolution was passed by the City Council (87-02) which established a minimum of 30% of the sales tax
collections be devoted to capital or capital related improvements. Although previous resolutions indicated the
intent of the City to account for these expenditures separately, I can find no record of the City Council formally
THE CITY OF FAYETTEVILLE,ARKANSAS
creating the Sales Tax Capital Fund. Because of the requirements of GASB 54 it is necessary for the Council to
formally establish said Sales Tax Capital Fund to continue to account for and report this program separately in
the annual audited financial statements. Therefore, I request the City Council establish by ordinance the Sales
Tax Capital Fund to account for that portion of the city one cent sales tax allocated to capital and capital related
expenditures as determined and identified by the City Council in the annual budget of the City. To continue the
City's current policy, I also request the City Council specify that at least 30% of the city sales tax collections be
allocated to this fund for capital and capital related projects as determined by the City Council during the annual
budget process.
BUDGET IMPACT:
There is no additional cost to this request. It would codify the City's' past accounting and budgeting practices.
ORDINANCE NO.
AN ORDINANCE TO ENACT §34.09 SALES TAX CAPITAL FUND OF
THE CODE OF FAYETTEVILLE
WHEREAS, the Government Accountings Standards Board sets general accounting
principles and requires that cities account for certain revenues by placing them in separate funds;
and
WHEREAS, the City Council has determined to recognize and establish a separate Sales
Tax Capital Fund.
NOW, THEREFORE BE IT ORDAINED BY THE CITY COUNCIL OF THE
CITY OF FAYETTEVILLE,ARKANSAS:
Section 1: That the City Council of the City of Fayetteville, Arkansas hereby enacts
§34.09 Sales Tax Capital Fund of the Code of Fayetteville as shown below.
"§34.09 Sales Tax Capital Fund
"(A) The Sales Tax Capital Fund is recognized and established
as a separate fund to be used exclusively for capital and capital
related projects and purchases as authorized and appropriated by
the City Council.
(B) At least forty percent (40%) of the revenue derived from the
city one percent operating sales and use tax shall be deposited
into the Sales Tax Capital Fund in 2012. The City Council when
adopting budgets for 2013 and thereafter may lower this
minimum percentage for the Sales Tax Capital Fund, but not
below thirty-five percent (35%) for the Sales Tax Capital Fund
and not to exceed sixty-five percent (65%) for operations."
PASSED and APPROVED this 15'' day of November, 2011.
APPROVED: ATTEST:
By: By:
LIONELD JORDAN, Mayor SONDRA E. SMITH, City Clerk/Treasurer
RESOLUTION NO. 87-02
A RESOLUTION EXPRESSING THE CITY'S INTENT AS
TO THE USE OF COLLECTIONS OF THE PROPOSED
RENEWAL OF THE CITY WIDE SALES TAX AND USE TAX
WHEREAS, the City Council of the City of Fayetteville, Arkansas (the
"City")has passed on June 4,2002,Ordinance No.4397 providing for continuing
the levy of a 1%Sales and Use tax within the City(the"Tax") if approved by the
voters;and
WHEREAS,the Tax will continue to be levied under Title 26,Chapter 75,
subchaper 2 of the Arkansas Code of 1987 Annotated and may be used by the
City for any purpose for which the City's general funds may be used,and;
WHEREAS,after public hearings and a vote of the City Council, the City
updates yearly a five year plan of capital improvements which lists the specific
capital improvement goals of the City and prioritizes the need for such capital
improvement projects,and;
WHEREAS, the purpose of this resolution is to clarify for the Fayetteville
voters some of the purposes for which the City Council expects to finance and/or
maintain with tax collections.
NOW,THEREFORE,BE IT RESOLVED BY THE CITY COUNCIL OF
THE CITY OF FAYETTEVILLE,ARKANSAS:
Section 1: The City hereby expresses its intent to utilize 50% of Tax
collections in each calendar year through December 31,2006 for the financing of
capital improvements as set forth in the City's five year Capital Improvement
Program. It is the City's further intent that these funds be accounted for
separately and used only for capital improvement projects.
Section 2: The City hereby further expresses its intent to utilize the
remaining 50% of tax collections in each calendar year for City operations and
maintenance and,should such collections exceed any need for such purpose,the
remaining amounts may be used for financing capital improvements.
4
Rest
Section 3: The City Council shall reexamine the revenue needs of the
City in reference to both capital improvements and operating expenses and
needs for budget year 2006 and thereafter and may adjust the division of the
sales tax collections between capital improvements and operating expenses as
needed. However,no yearly adjustment may exceed ten percent(20%)from the
division existing in the previous year and the amount devoted to capital
improvements shall never drop below thirty percent(30%).
Section 4: It is the City's intent to finance these capital improvements
on a pay-as-you-go basis without the necessity of a bond issue.
PASSED and APPROVED this the 4th day of June,2002.
APPROVED:
�`• ��`�ETTEy��.
By:
�+ DAN GOODY; Mayo
:,
eather Woodruff,City Elerk
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ORDINANCE NO.
AN ORDINANCE TO ENACT §34.09 SAES TAX CAPITAL FUND OF
THE CODE OF FAYETTEVILLE
WHEREAS,°,the Government Accoun�tings Standards Board sets general accounting
principles and requires'`that cities account for certain revenues by placing them in separate funds;
and /
WHEREAS, the City,Council has/determined to recognize and establish a separate Sales
Tax Capital Fund.
NOW, THEREFORE BE. IT ORDAINED BY THE CITY COUNCIL OF THE
CITY OF FAYETTEVILLE,Ak /ANSAS:
Section 1: That the City/Council of the City of Fayetteville, Arkansas hereby enacts
§34.09 Sales Tax Capital Fund/of the Code of Fayetteville as shown below.
"§34.09 Sales Ta Capital Fund`,,,
"(A) T e Sales Tax Capital Fund is recognized and established
as a se arate fund to be used exclusively for capital and capital
relate projects and purchases as authorized and appropriated by
the rty Council.
/division
At least forty percent (40%) of the revenue derived from the
one percent operating sales and use tax shall be deposited
the Sales Tax Capital Fund in 2012. The"City Council when
ting budgets for 2013 and thereafter 'inay lower this
mum percentage for the Sales Tax Capital`',Fund, but not
than five percent (5%) per year to an absolute minimum
of thirty percent (30%) for the Sales Tax Capital Fund
and seventy percent (70%) for operations as was approved by
City Council Resolution No. 87-02 in 2002."
PASSED and APPROVED this 1St day of November, 2011.
APPROVED: ATTEST:
By: By:
LIONELD JORDAN, Mayor SONDRA E."`SMITH, City Clerk/Treasurer
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NORTHWEST ARKANSAS DEMOCRAT-GAZETTE
NORTHWESTARKANSAS THE MORNING NEWS OF SPRINGDALE
THE MORNING NEWS OF ROGERS
SP-M- EJL%OLLC NORTHWEST ARKANSAS TIMES
BENTON COUNTY DAILY RECORD
212 NORTH EAST AVENUE,FAYETTEVILLE,ARKANSAS 72701 1 P.O.BOX 1607,72702 1479-442-1700 1 WWW.NWANEWS.COM
AFFIDAVIT OF PUBLICATION
I, Cathy Wiles, do solemnly swear that I am the Legal Clerk of the RECEIVED
Northwest Arkansas Newspapers, LLC, printed and published in NOV 2 9 2011
Washington and Benton County, Arkansas, bona fide circulation, OITY OF FAYETTEVILLE
that from my own personal knowledge and reference to the files CITY CLERK'S OFFICE
of said publication, the advertisement of.-
City
f:City of Fayetteville
Ordinance 5458
ORDINANCE NO 5458
AN ORDINANCE TO ENACT§34 09 SALES TAX r.yn
Was inserted In the Regular Editions on: "CAPITAL FUND OF THE CODE OF FAYEITEVILLE
WHEREAS the Govemralerlt AccgUntings Standards
November 24, 2011 sets general�cgduntir�g pnncii?�es and requires �paKnr�s�ns
.that cities;`account-for c, n ravis ues by�piaang
;;them In separate funds;; ;
YVHEREpS,the City rbunoil has tletermtned Co recognize and establish a separate Sales m;,
Tax Capital Fund
NOW THERFORE BE T ORTCOUNCIL=,OF.YTHS°CITY OSS
Publication Charges: $ 71.33 FAY11ir ILLE ARICANsaS ,.,
Section 1 That2he City Council of thezCiiy of'Fayetteville,^`Arkansas hereby enadts§34 Og
Sales Taz Capital fund ofhthe
C, Fayette
Fayetteville
§34 0'9 Sales Tax Capital Fund
6(A) ThesSales,Tax^Capifal Fuhd is reeogrilzed,and established as aseparate'fShtl to be�
used ezclusrvely,for capital and capital related protects and purchases as authorized and
appfopnated by the City 9940911.
iB) At least forty percent(40%)of he revenue denved from the city ohe percent operating
sales-an -use tax shall be deposited into the Sales Tax Capital Fund in 2012 The City °
Counal wfien adopting budgets for 2013 and.-thereafter may lower this minimum,petcent ,
age for the Sales Tax Capital FLnd but not below thirty-fNe percent(35%)for ttfie Sales Tax
CathWiles Capital Fuld and not to exceed sittty five perdent(65%)for operations. ,
Cathy pASSF4;end`APPROVED this f5th day of November2011
�APPROVE0.,
LIONELD JORDAN,Mayor. SONORA E.SMITH,City Cierklfreasutar
71
Subscribed and sw99r��to bef re me
This&*day of /16� 2011.
No ary Public
My Commission Expires:
SANDRA E.SCHACHERBAUER
8MM All COUNYY
t0TA"PtM=.ARKANSAS
My 06mr8t33 w Explrdg April 18,2097
4tsiitHftfdn NO.123M121
**NOTE**
Please do not pay from Affidavit. Invoice will be sent.