HomeMy WebLinkAbout12/6/2000 - STAFF REPORTS (17) Date: December 6, 2000
Memo To: City Council
From: Director of Finance &Treasurer
Re: Establishment of Disaster Fund
Recommendation:
It is recommended that the City Council authorize the creation of a new fund to be named the
Disaster Preparedness Fund to provide an accounting structure for tracking expenses in the
event of a major disaster.
Summary:
Council approval is necessary for the creation of new Funds. A Disaster Preparedness Fund
would provide pre-established account numbers to which expenses incurred during a major
disaster could be charged, greatly simplifying the task of getting reimbursed for the expenses
from State or Federal agencies. No additional appropriations are being requested.
Background:
The City has over 50 funds to segregate and keep track of its expenditures. These funds are
established to conform to generally accepted accounting principles or because they are
required by law.
When a major disaster occurs, the first priority, of course, is the health and safety of the
citizens of Palm Springs. Sometime after the disaster, it is necessary to total up the expenses.
Generally, if the City is to avoid having the disaster compounded by financial problems, these
expenses are reimbursed by a State or Federal agency.
One of the most prominent disaster relief agencies is the Federal Emergency Management
Agency, or FEMA. In past disasters, such as the 1995 floods, FEMA's on site engineers have
been very flexible in authorizing City staff or contract workers to address problems
immediately. Unfortunately, FEMA's auditors have required a much higher standard of proof
for the expenditure of time and materials. It has sometimes been a difficult task to assemble
the necessary detail and documentation to satisfy the auditors.
A separate fund that would be used only in the event of a major disaster would help simplify
the process. Within the fund, cost centers could be established by type of work (e.g., flood
channel clearance) or by department (Police, Fire, Streets, etc.). Each cost center would be
set up with pre-existing account numbers so that expenses could be adequately tracked. The
point is to stay out of the way of the first priority while ensuring that the City is eventually
reimbursed for the costs of the disaster.
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The Disaster Preparedness Fund would be established in the Special Revenue Fund group.
The cost centers and account numbers established would not have any money appropriated to
them. If a disaster strikes, the Fund could be activated immediately, funded by an emergency
transfer from the General Fund and ratified by Council. When the expenses are reimbursed
from FEMA or some other source, the General Fund would be repaid.
A resolution establishing the Disaster Preparedness Fund is attached.
Submitted by:
Thomas M. Kanarr
Director of Finance & Treasurer
Approved:
David H. Ready`
City Manager
Attachments: Resolution
/GA z
RESOLUTION NO.
OF THE CITY COUNCIL OF THE CITY OF
PALM SPRINGS, CALIFORNIA, ESTABLISHING
A DISASTER PREPAREDNESS FUND
-- -- -- -- --- -
WHEREAS, Resolution No. 18982, establishes certain policies pertaining to budget processes;
and
WHEREAS, the City Council must approve the creation of any new accounting Funds; and
WHEREAS, it is prudent to have an accounting structure in place in advance of a natural or
manmade disaster in order to track the expenses of such disaster and eventually receive
reimbursement;
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Palm Springs,
California, as follows:
Section 1. Establishment of Disaster Preparedness Fund
The Disaster Preparedness Fund is hereby established, as a new Fund in the Special
Revenue Group of City funds, and the Director of Finance &Treasurer is directed to create the
appropriate accounting structure.
Adopted this day of 2000.
AYES:
NOES:
ABSENT:
ATTEST:
CITY OF PALM SPRINGS, CALIFORNIA
By:
City Clerk City Manager
Reviewed and Approved by:
1L �