Chapter 4.40
FUNDS

Sections:

4.40.010    Funds – Created.

4.40.011    Investment of city funds and apportionment of income derived from such investment.

4.40.012    Petty cash accounts – Establishment and regulation.

4.40.020    Beautification fund.

4.40.030    Bond redemption fund.

4.40.040    Capital improvement fund.

4.40.050    City street fund.

4.40.060    Claims fund.

4.40.070    Contingency fund.

4.40.080    Current expense (general) fund.

4.40.090    Equipment rental fund.

4.40.100    Firemen’s relief and pension system.

4.40.110    LID guaranty fund.

4.40.120    Payroll fund.

4.40.130    Self-insurance claim reserve fund.

4.40.140    Sewer utility fund.

4.40.150    Storm water utility fund.

4.40.160    Technology and equipment fund.

4.40.170    Water utility fund.

4.40.180    Youth and family services fund.

4.40.190    Youth services endowment fund.

4.40.200    1% for art in public places fund.

4.40.010 Funds – Created.

The director of finance shall have the authority, without prior consent of the city council, to create or cancel a specific fund among the individual funds of the city in accordance with the applicable rules of the State Auditor and generally accepted accounting principles; provided, that no funds may be deposited into or expended from a fund created by the director of finance utilizing this authority without prior approval of the city council. As required by the Revised Code of Washington and generally accepted accounting principles, there are created in the city treasury the following funds to be known and designated as:

Beautification fund

Bond redemption fund

Capital improvement fund

City street fund

Claims fund

Contingency fund

Current expense (general) fund

Equipment rental fund

Firemen’s relief and pension fund

LID guaranty fund

Payroll fund

Self-insurance claim reserve fund

Sewer utility fund

Storm water utility fund

Technology and equipment fund

Water utility fund

Youth and family services fund

Youth services endowment fund

1% for art in public places fund

(Ord. 13C-10 § 1; Ord. A-41 § 1, 1985; Ord. 495 § 6, 1980).

4.40.011 Investment of city funds and apportionment of income derived from such investment.

The city manager or his designee is authorized to determine the amount of money available in each fund of the city for investment purposes and may make investments authorized by law without the prior consent of the city council for each such investment. A report of investment transactions shall be made to the city council as required by law.

Moneys determined available for investment may be invested on an individual fund basis or may, unless otherwise restricted by law, be commingled with one common investment portfolio for investment. All income derived from such investment shall be applied for the benefit of the general or current expense fund of the city except as otherwise required to be invested by state statute, ordinance, resolution, or bond covenant. (Ord. 13C-10 § 1; Ord. A-12 § 1, 1982).

4.40.012 Petty cash accounts – Establishment and regulation.

The city finance director is authorized to establish petty cash accounts within the operating funds of the various city departments for the purpose of making miscellaneous small expenditures of funds without the necessity of voucher and warrant. The establishment of petty cash accounts shall be requested in writing by the head of the department in the form and detail prescribed by the finance director. All expenditures from such accounts shall be made from appropriations and for purposes authorized by the departmental annual budget. The maximum amount of such accounts shall be set by the finance director according to the needs of the petitioning department.

The finance director shall promulgate rules and regulations for the use of petty cash accounts which are consistent with this code, and in accordance with budgeting, accounting and reporting system (BARS). (Ord. 13C-10 § 1; Ord. A-80 § 1, 1989).

4.40.020 Beautification fund.

A. There is established in the city treasury a special fund to be known and designated as the “beautification fund.”

B. There shall be deposited into this fund all tax revenues collected by the city pursuant to Chapter 4.10 MICC, except registration fees, penalties and interest.

C. There shall be paid from this fund expenditures relating to beautification of the city for the following and related purposes as determined by the city council:

1. Installation and maintenance of landscaping including plants and other landscape materials on public property or easements;

2. Acquisition, operation and/or maintenance of any building, facility, property or easement for park, recreation or open space purposes;

3. Undergrounding of power lines and lighting facilities for the operation and maintenance thereof on public property or easements;

4. Promotion and support of a central business district revitalization program;

5. The promotion, support, acquisition and installation of public art on public property or easements;

6. Acquisition or leasing of parking spaces for Mercer Island residents for the purpose of providing additional parking;

7. Enforcement of parking restrictions, providing signage related to parking, providing permits and any other expenses related to parking restrictions; and

8. All expenses, including, but not limited to, professional fees, printing and publishing incurred in connection with the above-listed purposes. (Ord. 13C-10 § 1; Ord. 03C-02 § 1; Ord. 01C-13 § 1; Ord. A-72 § 2, 1988; Ord. 495 § 6, 1980. Formerly 4.40.140 – 4.40.160).

4.40.030 Bond redemption fund.

A. There is established in the city treasury a special fund to be known and designated as “bond redemption fund.”

B. There shall be deposited into this fund all revenue received in accordance with the bond redemption schedules.

C. There shall be paid from this fund all expenditures according to the bond redemption schedules. (Ord. 13C-10 § 1; Ord. 495 § 6, 1980. Formerly 4.40.170 – 4.40.190).

4.40.040 Capital improvement fund.

A. There is established in the city treasury a fund to be known and designated as the “capital improvement fund.”

B. There shall be deposited into this fund all moneys received by the city from the treasurer for King County in distribution of the one-quarter of one percent real estate excise tax imposed by the city pursuant to MICC 4.24.010.

C. The city manager or his designee may direct the transfer to or deposit in this fund any additional grants, gifts, moneys or general city revenues as authorized by ordinance, resolution or motion duly passed.

D. There shall be paid from this fund all expenditures for the accomplishment of local public works and improvements including, but not by way of limitation, those listed and authorized in RCW 82.46.010. (Ord. 13C-10 § 1).

4.40.050 City street fund.

A. There is established in the city treasury a special fund to be known and designated as the “city street fund.”

B. There shall be deposited into this fund all revenues received in connection with Chapter 46.68 RCW and all other moneys transferred and appropriated to this fund by the city council.

C. There shall be paid from this fund all expenditures in connection with the maintenance, operation and construction of all city streets. (Ord. 13C-10 § 1; Ord. 495 § 6, 1980. Formerly 4.40.230 – 4.40.250).

4.40.060 Claims fund.

A. There is established in the city treasury a special fund to be known and designated as the “claims fund.”

B. There shall be transferred into this fund amounts from the various department funds of the city which are now or may hereafter be established, and, from the current expense fund, an amount equal to the approved claims against the city for any purpose, excepting payroll.

C. The finance director is authorized to transfer from the funds of the various city departments sufficient funds to pay all claims against the city for any purpose, except payroll. Such transfers shall be made only after the city council has approved the payment of said claims.

D. The finance director is authorized to issue warrants on and against the city for any purpose, excepting payroll. The warrants shall be issued only after the claims against the city have been approved for payment by the city council.

E. All warrants issued on or against this fund shall be used solely and only for the purpose set forth in this chapter and shall be payable only out of and from this fund. (Ord. 13C-10 § 1; Ord. 495 § 6, 1980. Formerly 4.40.260 – 4.40.290).

4.40.070 Contingency fund.

A. There is established in the city treasury a special fund to be known and designated as the “contingency fund.”

B. The contingency fund shall be supported by a budgetary appropriation from any tax or revenue service not restricted to any use by law, and may also be supported by a transfer from any other unexpended or decreased fund made available by ordinance; provided, that the total amount accumulated in such fund at any time shall not exceed the equivalent of $0.375 per $1,000 of assessed valuation of property within the city at the time. Any moneys in the contingency fund at the end of the fiscal year shall not lapse except upon reappropriation by the city council to another fund in the adoption of a subsequent city budget.

C. No money shall be withdrawn from the contingency fund except by transfer to an appropriate operating fund authorized by ordinance of the city council, clearly stating the facts constituting the reason for the withdrawal or the emergency as the case may be and specifying the fund to which the withdrawn money shall be transferred. (Ord. 13C-10 § 1; Ord. 495 § 6, 1980. Formerly 4.40.320 – 4.40.340).

4.40.080 Current expense (general) fund.

A. There is established in the city treasury a special fund to be known and designated as the “current expense fund,” otherwise known as the general fund.

B. There shall be deposited into this fund all proceeds of licenses, the proceeds of all fines, the proceeds of all general tax levies made by the city council, and all other moneys received into the city treasury unless the same be specifically collected for or ordered paid into some other fund.

C. There shall be paid from this fund all general expenses of conducting the city of every nature and description. (Ord. 13C-10 § 1; Ord. 495 § 6, 1980. Formerly 4.40.350 – 4.40.370).

4.40.090 Equipment rental fund.

A. There is established in the city treasury a special fund to be known and designated as the “equipment rental fund” in accordance with the provisions of RCW 35.21.088.

B. The equipment rental fund shall be used as a revolving fund to be expended for salaries, wages and operations required for the repair, replacement, purchase and operation of equipment, and for the purchase of equipment, materials, and supplies to be used in the administration and operation of the fund.

C. The equipment rental fund shall be administered by the city manager or the finance director.

D. The schedule, which is on file in the office of the city clerk and by this reference made a part hereof, lists the equipment, supplies and materials which are transferred to the equipment rental fund, without charge, and the reasonable rental terms and charges for the use of the equipment, supplies and materials by the several departments of the city or by other governmental agencies. (Ord. 13C-10 § 1; Ord. 495 § 6, 1980. Formerly 4.40.440 – 4.40.470).

4.40.100 Firemen’s relief and pension system.

A. The municipal firemen’s relief and pension system, created, established and set forth in Chapters 41.16 and 41.18 RCW, is established in the city. All of the provisions, regulations and details of said chapters are by this reference incorporated in this chapter. Any and all amendments of said chapters or of any section thereof hereafter made shall likewise by this reference be constituted amendments of this chapter without the necessity of further adoption by the legislative authority of the city.

B. There is established a municipal firemen’s pension board, to consist of the officials and persons designated by statute, being initially the mayor, who shall be the chairman of the board, the city manager, the finance director, and, in addition, two regularly employed firemen elected by secret ballot of the firemen.

C. There is established in the treasury of the city a fund to be known and designated as the “firemen’s pension fund,” into which shall be deposited moneys, bequests, fees, gifts, emoluments, donations, taxes, interest, contributions by firemen, including deductions from their pay, and moneys deriving through the state from taxes on fire insurance premiums. Administration of and disbursements from the fund shall be conducted and made as provided by statute. (Ord. 13C-10 § 1; Ord. 495 § 6, 1980. Formerly 4.40.510 – 4.40.530).

4.40.110 LID guaranty fund.

A. Pursuant to Chapters 35A.43 and 35.54 RCW, there is created a fund of the city to be known and designated as the “local improvement guaranty fund” for the purpose of guaranteeing, to the extent of such fund, in the manner provided by law and this chapter, the payment of local improvement district bonds, warrants and other obligations hereafter issued to pay the cost of improvements constructed in all local improvement districts of the city.

B. From time to time hereafter for the purpose of maintaining the local improvement guaranty fund, the city shall at the time of making its annual budget and tax levy provide for the levy of a sum sufficient, together with other resources of the fund, to meet the financial requirements of such fund; provided, that the levy of any one year shall not exceed five percent of the outstanding obligations guaranteed by the fund.

C. Warrants drawing interest at a rate to be determined by the city treasurer shall be issued against the local improvement guaranty fund to meet any liability accruing against it. The warrants so issued shall at no time exceed five percent of the outstanding obligations guaranteed by the fund. At the time of making its annual budget and tax levy the city shall provide for the levying of a sum sufficient with other resources of the fund to pay warrants so issued during the preceding fiscal year.

D. Defaulted bonds, interest coupons, warrants and other obligations against local improvement district funds of the city shall be purchased out of the guaranty fund and as between the several issues of such bonds, coupons, warrants or other obligations no preference shall exist, but they shall be purchased in the order of their presentation.

E. Certificates of Delinquency for General Taxes.

1. For the purpose of protecting the guaranty fund, so much of the guaranty fund as is necessary may be used to purchase certificates of delinquency for general taxes on property subject to local improvement assessments which underlie the bonds, coupons, warrants or other obligations guaranteed by the fund or to purchase such property at county tax foreclosure or from the county after foreclosure.

2. The city, as trustee of the fund, may foreclose the lien of general taxes and certificates of delinquency and purchase the property at foreclosure sale. When doing so, the court costs, costs of publication, expense for clerical work and other expenses incidental thereto shall be charged to and paid from the local improvement guaranty fund.

3. After acquiring title to property by purchase at general tax foreclosure sale or from the county after foreclosure, the city may lease it or sell it at public or private sale at such price and on such terms as may be determined by resolution of the city council. All proceeds shall belong to and be paid into the local improvement guaranty fund.

F. Interest and Earnings.

1. Interest and earnings from the local improvement guaranty fund shall be paid into the fund. If in any local improvement district fund guaranteed by the local improvement guaranty fund there is a surplus remaining after the payment of all outstanding bonds, warrants and other obligations payable therefrom, it shall be paid into the local improvement guaranty fund.

2. Whenever any sum is paid out of the local improvement guaranty fund on account of the principal or interest of a local improvement district bond, warrant or other obligation, the city, as trustee of the fund, shall be subrogated to all the rights of the holder of the bond, interest coupon, warrant or other obligation so paid and the proceeds thereof or of the underlying assessment shall become part of the guaranty fund. (Ord. 13C-10 § 1; Ord. A-23 §§ 1 – 6, 1983. Formerly 4.40.610 – 4.40.660).

4.40.120 Payroll fund.

A. There is established in the city treasury a special fund to be known and designated as the “payroll fund,” into which shall be paid and/or transferred moneys from time to time as directed by the city council from any funds available for the purpose of paying any moneys due city employees for salaries and wages. The accounts of the city shall be so kept that they shall show the department or departments and respective amounts to which the payment is properly chargeable.

B. Payment of salaries and wages shall be made by the issuance of warrants or bank checks drawn against the payroll fund. If bank checks are used for payment they shall be drawn on the bank which is designated as the official city depository.

C. Transfers from an insolvent fund to the payroll fund shall be by warrant. (Ord. 13C-10 § 1; Ord. A-15 § 1, 1982; Ord. 495 § 6, 1980. Formerly 4.40.670, 4.40.680).

4.40.130 Self-insurance claim reserve fund.

A. There is established in the city treasury a special fund to be known and designated as the “self-insurance claim reserve fund.”

B. There shall be maintained within the insurance claims reserve fund an account to receive moneys and make expenditures for physical loss to city-owned property. The account shall have a minimum balance as of the beginning of the fiscal year 1982 of $40,000.

C. All expenditures from the self-insurance claims reserve fund must be approved by the city council and finance director. (Ord. 13C-10 § 1; Ord. A-4 § 1, 1981; Ord. 495 § 6, 1980. Formerly 4.40.720 – 4.40.750).

4.40.140 Sewer utility fund.

A. There is established in the city treasury a special fund to be known and designated as the “sewer utility fund.”

B. There shall be deposited into the fund all of the gross earnings and revenue of the city’s sewer system.

C. There shall be paid from this fund all the expenses of operation and maintenance of such system. (Ord. 13C-10 § 1; Ord. 495 § 6, 1980. Formerly 4.40.760 – 4.40.780).

4.40.150 Storm water utility fund.

A. There is established in the city treasury a special fund to be known and designated as the “storm water utility fund.”

B. There shall be deposited into this fund all of the gross earnings and revenue of the storm water utility of the city.

C. There shall be paid from this fund all the expenses of operation and maintenance of such system. (Ord. 13C-10 § 1).

4.40.160 Technology and equipment fund.

A. There is established in the city treasury a special fund to be known and designated as the “technology and equipment fund.”

B. There shall be deposited into this fund moneys to be used exclusively for technology and/or the acquisition of equipment for the city.

C. There shall be made from this fund expenditures solely for technology and/or the acquisition of equipment for the city. (Ord. 13C-10 § 1; Ord. 495 § 6, 1980. Formerly 4.40.690 – 4.40.710).

4.40.170 Water utility fund.

A. There is established in the city treasury a special fund to be known and designated as the “water utility fund.”

B. There shall be deposited into this fund all of the gross earnings and revenue of the water system of the city.

C. There shall be paid from this fund all the expenses of operation and maintenance of such system. (Ord. 13C-10 § 1; Ord. 495 § 6, 1980. Formerly 4.40.810 – 4.40.830).

4.40.180 Youth and family services fund.

A. There is established in the city a special revenue fund to be known and designated as the youth and family services fund.

B. Funding for the youth and family services fund shall be by private or public gifts, endowments, donations, bequests or other such sources or grants which are intended to be deposited in the youth and family services fund.

C. All gross revenue earned by the Mercer Island Thrift Shop shall be deposited in the youth and family services fund and use shall be committed to the development and delivery of human services and related programs provided by the department of youth and family services.

D. All expenditures will be made from the fund only upon recommendation of the director of youth and family services, subject to budget approval by the city council. (Ord. 13C-10 § 1; Ord. 12C-09 § 3. Formerly 4.40.980 – 4.40.990).

4.40.190 Youth services endowment fund.

A. There is established in the city a special fund to be known and designated as the youth services endowment fund.

B. Funding for the youth services endowment fund shall be by private or public gifts, endowments, donations, bequests or other such sources or grants which are intended to be deposited in the youth services endowment fund.

C. Only income earned from investment of the funds in the endowment fund may be expended unless the city council shall specifically authorize expenditure of principal. All invested funds, including unspent income from investment, shall be maintained in the youth services endowment fund, and carried forward at the end of each budget year.

D. All expenditures will be made from the fund only upon recommendation of the director of youth and family services, subject to budget approval by the city council. (Ord. 13C-10 § 1; Ord. 12C-09 § 2; Ord. A-45 § 2, 1986. Formerly 4.40.910 – 4.40.930).

4.40.200 1% for art in public places fund.

A. There is established in the city treasury a special fund to be known and designated as the “1% for art in public places fund” for the purpose of providing funds for 1%-for-the-arts projects.

B. As used in connection with the 1% for art in public places funds and 1%-for-the-arts projects, the following terms have the meanings set forth below:

1. “Acquisition of real property” means the purchase of parcels of land or existing buildings and structures, including associated costs such as appraisals or negotiations.

2. “Art in public places” means any expression by an artist of visual works of art available to the public in an open city-owned facility in areas designated as public areas, or on non-city-owned property if the work of art is installed or financed, either in whole or in part, by the city.

3. “Arts council” means the Mercer Island arts council.

4. “Demolition costs” means the cost of removing buildings or other structures from the property.

5. “Equipment” means equipment or furnishings that are portable.

6. “Qualifying capital improvement project” means projects funded wholly or in part by the city to construct or remodel any public project including buildings, decorative or commemorative structures, parks or any portion thereof; and projects involving the construction, renovation or repair of public streets, sidewalks, and parking facilities.

C. All authorizations and/or appropriations for qualifying capital improvement projects shall include an amount of not less than one percent of the total project cost to be set aside for transfer to the 1% for art in public places fund.

D. For qualifying capital improvement projects, the minimum amount to be appropriated for art in public places shall be as follows:

1. When the total estimated cost of a project exceeds $100,000 the amount shall be based on the total amount of the awarded contract as originally approved by the city council or as subsequently amended multiplied by one percent.

2. When the estimated cost of the project is $100,000 or less the amount shall be based on the estimated cost of the project multiplied by one percent.

Provided, however, that any city-funded amount for the acquisition of real property or equipment or for demolition shall be excluded for the purposes of this calculation.

E. In the case of a city project which involves the use of general obligation bond proceeds, funds appropriated shall be used for projects and for capital purposes consistent with the authorizing resolution or ordinance approved by the city council and the voters.

F. The appropriations from qualifying capital improvement projects shall be pooled into the 1% for art in public places fund. The city council, upon advice and recommendation from the arts council, shall approve, from time to time, the amount to be authorized for 1%-for-the-arts projects. These funds shall be used for:

1. Selection, acquisition and installation or display of original works of visual art which may be an integral part of the project, or be placed in, on or about the project or in another public facility; and

2. Repairs and maintenance of public art acquired with 1%-for-the-arts funds; and

3. Other project-specific expenses of selection and acquisition; provided, that no part of the funds shall be used to pay administrative staffing expenses of the program.

G. Any unexpended 1%-for-the-arts funds which remain in the 1% for art in public places fund at the end of any budget year shall not be transferred to the general fund or otherwise lapse, but said unexpended funds shall be carried forward from year to year until expended for the purposes set forth in this section, unless otherwise directed by the city council.

H. Annually, the arts council shall make recommendations to the city council that will reflect short and long range planning for art works and sites regarding the appropriation of 1%-for-the-arts funds. The recommendations will relate to but will not be limited by the following:

1. Art projects will be responsive to the developing public art needs of the community;

2. Art projects will reflect the scope, scale and character of the site; and

3. Art projects will be part of new parks and building developments. The arts council shall carry out all necessary tasks and procedures consistent with established arts policies for the selection, placement and conservation of art works.

I. All works of art purchased and commissioned from the 1% for art in public places fund shall be the property of the city and shall become part of the city art collection. The city art collection shall be developed, administered and operated by the Mercer Island arts council. (Ord. 13C-10 § 1; Ord. A-108 § 1, 1993. Formerly 4.40.970 – 4.40.977).