Chapter 6.28
SUSTAINABILITY FUND
Sections:
6.28.030 Sustainability fund contributions.
6.28.040 Sustainability fund investment.
6.28.050 Use of sustainability fund.
6.28.010 Sustainability fund.
A long-term sustainability fund is hereby created that will be maintained and preserved separate and apart from all other borough funds to foster investment of borough revenue and sustain long-term borough operations. The purpose of the sustainability fund is to utilize revenue for long-term investment that will eventually yield investment revenue to help augment borough operations in the absence of sufficient tax or payment in lieu of taxes revenue. (Ord. 20-07 § 1, 2020; Ord. 17-06 § 1, 2017)
6.28.020 Findings.
A. Exhaustible Tax Base. Most of the borough’s revenue is derived from taxation of nonrenewable resources, and the nonrenewable portion of the borough’s revenue stream cannot be replaced by other revenue generation mechanisms available to the borough. Future revenue sources are unknown. To ensure long-term operation of the borough, the borough should invest revenue now to create a fund of sufficient size to generate meaningful investment income to support general operations when adequate tax revenue is unavailable to fund borough services.
B. Fiscal Responsibility. Recognizing that future revenue sources are unknown, the borough affirms the importance of avoiding the unsustainable growth of borough services and general operations, and the importance of investing for long-term needs. (Ord. 20-07 § 1, 2020; Ord. 17-06 § 1, 2017)
6.28.030 Sustainability fund contributions.
A. Automatic Transfers. On an annual basis, the assembly must designate an appropriation to the sustainability fund allocating 30 percent of the funds annually derived from agreements negotiated under NABC 6.08.020 for long-term operation of borough services, programs, and capital projects. All sustainability fund allocations must be realized and invested pursuant to NABC 6.28.040 by the end of each fiscal year.
B. Discretionary Transfers. The assembly may transfer revenue to the sustainability fund by budget ordinance. (Ord. 20-07 § 1, 2020; Ord. 17-06 § 1, 2017)
6.28.040 Sustainability fund investment.
The sustainability fund will be invested in accordance with the borough investment guidelines codified at Chapter 6.20 NABC except that the investment portfolio will be managed without considering the need for sufficient liquidity to meet cash flow requirements. Instead, the sustainability fund will be managed to maximize long-term investment growth while maintaining safety of the fund’s principal. (Ord. 20-07 § 1, 2020; Ord. 17-06 § 1, 2017)
6.28.050 Use of sustainability fund.
A. Pledge for Bonded Debt. Money in the sustainability fund may be pledged by ordinance to secure payment of the borough’s general obligation bonds.
B. Use of Investment Income. After fiscal year 2030, on an annual basis, the assembly may approve, by a three-fourths vote of assembly members, the use of up to four percent of the five-year average of the sustainability fund’s calendar-year-end market value.
C. Use of Fund. Except as provided in subsection (B) of this section, no expenditure may be made from the sustainability fund without the approval of a majority of borough voters voting on the question at a regular or special election. Prior to submitting to the voters, assembly must pass an ordinance approved by at least 10 members approving use of the fund and determining that all reasonable options for borrowing funds have been exhausted. (Ord. 20-07 § 1, 2020; Ord. 17-06 § 1, 2017)
6.28.060 Amendment.
This chapter may not be amended without approval of all 11 borough assembly members. (Ord. 20-07 § 1, 2020; Ord. 17-06 § 1, 2017)