Commission examines updated financial integrity principles and a proposed emergency reserve

City budget staff presented proposed amendments to Fort Lauderdale’s Financial Integrity Principles, including a new section establishing guardrails for a recommended Emergency Reserve Fund and updated reporting schedules.

Keith Farrell, assistant budget manager, said staff proposes maintaining a minimum emergency reserve equal to 1% of general fund operating expenses, seeding the reserve in FY26 with a $4.8 million PFAS allocation, and allowing transfers of excess funds above 5% of the operating budget into one-time uses such as CIP projects. The staff also proposes an updated target fund-balance commitment of three months of operating expenses while preserving a minimum two-month floor consistent with best practices.

Commissioners debated two main issues: the reserve target and financial-reporting deadlines. One commissioner argued the city should not add an emergency reserve because the current fund balance already exceeds policy; others and the Budget Advisory Board’s chair supported a larger target for cash-flow resilience given the city’s reluctance to raise taxes. On financial reporting, staff proposed aligning ACFR deadlines with state statute (a nine-month statutory deadline) while pursuing internal process and software improvements to meet earlier internal targets (ideally matching prior city goals of March 31 submission).

Staff said the proposed principle changes also include clarifying the cost-recovery policy, updating the general-fund balance language to show a minimum and a three-month target, and switching monthly compilation to quarterly projection reports that are forward-looking and actionable for management.

Next steps: staff will prepare the ordinance/amendments for first reading in February and return with final language incorporating commissioner feedback.