2.20.050 Interfund loans – Authority.
The City Council does hereby grant the authority to the City Manager to make one or more interfund loans, subject to the following restrictions and conditions:
(1) The City Manager is hereby authorized to administer an interfund loan program. Only municipal monies that are clearly inactive or in excess of current needs for the anticipated length of the loan and legally available for investment (i.e., no restrictions) shall be utilized for interfund loans.
(2) The City Council must, by resolution, approve all interfund loans, indicating the lending and borrowing funds, and provide in the authorization a planned schedule of repayment of the loan principal as well as setting a reasonable rate of interest to be paid to the lending fund if required. The planned schedule of repayment shall specify the due date(s) of payment(s) needed to repay the principal and interest on the loan.
(3) Interest shall be charged in all cases, unless:
(a) The borrowing fund has no other source of revenue other than the lending fund; or
(b) The borrowing fund is normally funded by the lending fund.
(4) When required, each loan shall carry interest at a rate no less than the monthly Local Government Investment Pool rate for each respective month or part thereof.
(5) The borrowing fund must anticipate sufficient revenues to be in a position over the period of the loan to make the specified principal and interest payments as required in the authorizing resolution.
(6) The loan status shall be reviewed annually by the City Council at any open public meeting.
(7) The term of the loan may continue over a period of more than one year but must be temporary and shall not continue longer than three years unless otherwise approved by the City Council. No permanent diversion of the lending fund shall result from the failure to repay by the borrowing fund. These restrictions and limitations do not apply to those funds that are legally permitted to support one another through appropriations, transfers, advances, etc.
(8) Appropriate accounting records shall be maintained to reflect the balances of loans in every fund affected by such transactions. (Ord. 02-22 § 2 (Exh. A))