The Ypsilanti City Council created a stabilization, or “rainy day”, fund to help deal with financial emergencies. But it still needs to set the guidelines for the conditions it can be used. The issue is expected to be discussed during today’s Council Finance Committee meeting.
There is about $3 million currently in the fund. A proposed ordinance would require there be a sharp decline in revenue or a major fiscal emergency before it can be used.
2nd Ward Council member Patrick McLean says he wants to make sure it isn’t used as an easy way to balance a future budget.
“This Rainy Day Fund, as we call it, is really designed for times when revenues fall short of projections and of normal revenue cycles. So, this is when we’re in, for example, an economic downturn.”
McLean says too often municipalities and other government bodies will dip into reserve funds, as opposed to making difficult decisions. He says that always turns out bad in the long run.
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