FY2022 Adopted Operating and Capital Budget

FY2022 Adopted Budget Budget and Finance Policy Committed General Fund Balance Policy

Section 2 7 1(a) (2) of th e Frederick County, Maryland Code of Ordinances provide s for the Count y to maintain a committed Genera l Fun d balanc e equa l t o seve n percen t of Genera l Fun d expenditures an d transfers t o the Boar d of Educatio n and Frederic k Communit y College o n a budgetar y basis.

Investment Policy Th e Count y has a written investmen t polic y tha t ensures tha t th e investment program is strictl y adhere d t o and th e securit y RI &RXQW\ LQYHVWPHQWV LV PD[LPL]HG &DVK KHOG WHPSRUDULO\ LGOH GXULQJ WKH \HDU E\ )UHGHULFN &RXQW\¶V SULPDU\ government, was invested i n certificates of deposits , obligations of federa l governmen t agencies and the Stat e of Maryland Loca l Governmen t Investmen t Pool, al l of whic h ar e full y collateralize d b y United State s Governmen t obligations for periods rangin g from one da y to thre e years . Th e Count y also has a delivered collatera l policy. General Fund Revenue Surplus Appropriation Policy Provides managemen t with th e flexibilit y t o appropriate financia l resources from th e curren t fisca l year or projecte d surplus Genera l Fund revenues i n th e curren t or immediat e subsequen t fiscal yea r budget. This polic y requires th e annua l review o f propert y tax an d income tax revenues. If a surplus i s determined, those funds ma y be appropriate d t o offse t nonrecurring expenditures.

Debt Policy Th e deb t polic y sets fort h comprehensive guideline s fo r the financing of capita l expenditures . The polic y provides parameters for issuin g deb t and managin g outstandin g debt. Th e polic y provides guidanc e to decisio n makers regardin g the timin g an d purpos e for whic h debt ma y be issued, wha t types and amounts of deb t ar e permissible , th e method of sale tha t ma y b e use d and th e debt structuring practices that ma y b e used. Th e Count y recognize s that adherenc e t o a deb t polic y helps ensur e tha t i t maintains a soun d deb t position and that credit qualit y i s protected.

Debt Affordability Policy In order to establish a saf e leve l of debt th e Count y commissione d a stud y which facilitate d the establishmen t of a Debt Affordabilit y limi t an d wa s recentl y reviewe d an d update d in 201 7 b y a n outsid e financia l consultant. This limi t assists i n th e establishmen t of soun d fisca l managemen t policies fo r the County, and helps to ensur e th e PDLQWHQDQFH RU SRVVLEOH LPSURYHPHQW RI WKH &RXQW\¶V FUHGLW UDWLQJ 7KH &RXQW\¶V ERQG UDWLQJ KDV EHHQ UHYLHZHG E\ 6WDQGDUG DQG 3RRU¶V )LWFK DQG 0RRG\¶V ,QYHVWRUV 6HUYLF e, Inc., whic h resulte d i n sustainin g AAA, AAA, Aa a ratings respectively. Th e Deb t Affordabilit y Limits Stud y recommende d th e use of Debt Affordabilit y standards, and th e followin g standards ar e bein g used : Genera l Fun d G.O. deb t service, as a percentage of Genera l Fun d revenue, should b e limite d to 9.0%

Genera l Fun d debt, as a percen t of assesse d valuation, shoul d be limite d t o 2.0% Genera l Fun d debt, as a percen t of Genera l Fund Revenue, shoul d b e limited t o 80.0% Tota l G.O . deb t service, as a percent of General Fun d Revenue , shoul d be limite d t o 17.2% 46