The URL can be used to link to this page

Home My WebLink About10138-11 Transfer $25,000 Rainy Day Fund No. 102 to Umeployment Compensation Fund Fund No. 713ORDINANCE No. 10138-11 Passed by the Common Council of the City of South Bend, Indiana Attest: Attest: December 12, 20 11 Presented by me to the Mayor of the City of South Bend, Indiana December 13, 20 11 Approved and signed by me O-Q- Wes! K: 20 City Clerk President of Common Council City Clerk c.c,c Mayor ORDINANCE NO. � _i AN ORDINANCE OF THE COMMON COUNCIL OF THE CITY OF SOUTH BEND, INDIANA, TRANSFERRING $25,000 FROM THE RAINY DAY FUND NO. 102 TO THE UNEMPLOYMENT COMPENSATION INSURANCE FUND 713 WITHIN THE CITY OF SOUTH BEND STATEMENT OF PURPOSE AND INTENT Effective January 1, 2011, the City of South Bend established the Unemployment Compensation Insurance Fund 713 for the payment of unemployment claims in a single fund and to charge an allocation to user departments to cover estimated costs of claims (Ordinance No. 10059 -10, 12/13/10). Due to high unemployment claims paid, as the result of federal extensions of unemployment benefits and other factors, it has become necessary to temporarily transfer monies from the Rainy Day Fund 102 to the Unemployment Compensation Insurance Fund 713 to meet current operational expenses. The Rainy Day Fund has sufficient monies to accommodate this temporary transfer. NOW, THEREFORE, BE IT ORDAINED by the Common Council of the City of South Bend, Indiana, as follows: Section I. The aggregate sum of $25,000 shall be transferred from the following fund as follows: $25,000 from Fund No. 102 - Rainy Day Fund Section II. The monies totaling an aggregate sum of $25,000 transferred per Section I from Fund No. 102 shall be deposited and loaned temporarily to the following fund: $25,000 to Fund No. 713 — Unemployment Compensation Insurance Fund Section III. All monies transferred under Section I to the funds designated in Section II shall be paid back to the originating fund no later than June 30, 2012. Section IV. To the extent that sufficient revenue is received in the Unemployment Compensation Insurance Fund, City Administration will not implement this ordinance or will partially implement this ordinance as necessary to ensure a positive cash balance in the fund designated in Section II at December 31, 2011. Section V. This ordinance shall be in full force and effect from and after its passage by the Common Council and approval of t4e Mayor. I "A� Membe of the Common Counci Att4006 st: Presented by me to the Mayor of the City of South Bend, Indiana, on the 3AA,\ day of (z, 6t,.. , 2011, at t S_ S_ o'clock e . m. Approved and signed by me on the j .'/J o'clock. M. 9sf READING[ ( —•6d -1 PUBLIC FEARING 3 rd READING L L l 2 J\ NO APPROVED REF" 'ED PASSED Deputy C''t Clerk /�-"" day of , 2011, at Mayor, City i&oZuth Bend, Indiana � ? 37, _f va N"' EQY 2:3, TH 'i I JOHN vni n ky, V12 � TO THE COMMON COUNCIL OF THE CITY OF SOUTH BEND: Your Committee of the Whole, to whom was referred: BILL NO. 76 -11 A BILL OF THE COMMON COUNCIL OF THE CITY OF SOUTH BEND, INDIANA, TRANSFERRING $25,000 FROM THE RAINY DAY FUND NO. 102 TO THE UNEMPLOYMENT COMPENSATION INSURANCE FUND 713 WITHIN THE CITY OF SOUTH BEND Respectfully report that they have examined the matter and that in their opinion, this bill is being recommended to the full Council with a favorable recommendation. This bill was heard by the Personal & Finance Committee. Timothy Rouse Chairperson, Committee of the Whole COUNTY -CITY BUILDING 227 W. JEFFERSON BOULEVARD SOUTH BEND, IN 46601 r x 1 1 CITY OF SOUTH BEND STEPHEN J. LUECKE, MAYOR OFFICE OF ADMINISTRATION & FINANCE GREGG D. ZIENTARA, CITY CONTROLLER November 23, 2011 Mr. Derek Dieter President, South Bend Common Council 4th Floor, County -City Building South Bend, IN 46601 PHONE 574 - 235 -9216 FAX 574 - 235 -9928 Re: Ordinance of the Common Council Transferring Monies from the Rainy Day Fund to Support Temporary Cash Flow Issue Negative Cash Balances in Certain City Funds Dear President Dieter: Effective January 1, 2011, the City of South Bend established the Unemployment Compensation Insurance Fund #713 (Ordinance No. 10059 -10, adopted 12/13/2010) for the payment of unemployment insurance compensation claims in a single fund affecting an improved financial control over unemployment compensation claims required to be paid to former employees presented to the city by the Indiana Department,of Workforce Development. Ordinance 10059 -10 provided for the implementation of an "unemployment claim fee" to be charged to city operating departments to provide funding from departmental operations to the Unemployment Compensation Insurance Fund to affect payment of unemployment insurance claims. Due to a higher level of unemployment compensation insurance claims paid to former city employees than originally anticipated and projected, entirely the result of federal legislation extending the length in the months of benefit coverage, the Unemployment Compensation Insurance Fund is currently in a deficit balance. It is therefore necessary to temporarily transfer monies in the amount of $25,000 from the Rainy Day Fund 102 to the Unemployment Compensation Insurance Fund 713 to correct the deficit thereby meeting 2011 operational costs. The Rainy Day Fund has sufficient monies (in excess of $8.4 million) to accommodate this temporary cash transfer. I have attached a pro -forma cash flow schedule to this letter (not a part of the spending bill request) to provide Council with an improved understanding of the 2011 Unemployment Compensation Insurance Fund actual activity and a projection of forecasted 2012 cash flow activity. The pro -forma analysis demonstrates the high level of claim "payments ", the result of extended federal benefit coverage, paid for by the City of South Bend versus the projection of claim payments indicated as "receipts" on the pro -forma schedule. 0 The claim payments declined in the second half of 2011 due to benefit eligible former employees reaching the federal maximum months of benefit claim. The City pro -forma projection of Unemployment Compensation Insurance Fund activity in fiscal 2012 indicates a return to a more normalized level of anticipated unemployment claims. The Unemployment Compensation Insurance Fund will reimburse the Rainy Day Fund prior to June 30, 2012. The Office of the City Controller will continue to review the activity in this fund and the activity of unemployment claims in fiscal 2012 and determine and effect any required adjustments in "unemployment claim fees" charged to City operating Departments and funds. Further, the Office of the City Controller, through the Human Resource Department, will discuss and investigate with the Indiana Department of Workforce Development, potential strategy and approach to affect an improved control, if possible, of unemployment insurance claims. City Administration requests the Common Council to consider this Bill for 1s` read at the November 28, 2011 Common Council meeting, with 2 "d read, public hearing, 3rd read and Council vote at the December 12, 2011 Council Meeting. City Administration requests this Bill be assigned to the Personnel & Finance Committee. Controller Zientara will present this Bill to the Common Council at the appropriate Council Committee meeting, public hearing, and at the Council meeting. I am available to discuss any matters concerning this Bill at the convenience of the Council. I. Luecke, Mayor of the City of South Bend a ce P F :.Y tai T�q�