On April 26, 1992, the MLA Board of Directors voted to establish a reserve fund. The intent of the board is that monies in the reserve fund be expended only in the case of emergency. An emergency is defined as an unforeseen combination of events or circumstances that required immediate action, including the expenditure of non-budgeted funds. Three factors should be considered in determining whether an emergency exists: time, financial need, and liability.
The board action requires that the reserve fund be adjusted at the beginning of each fiscal year so that the balance is maintained at not less than eighteen (18) percent of the previous year’s actual expenditures. Whether or not money has been expended from the reserve fund during the previous year, the first budget action an any fiscal year must be to calculate and budget for the appropriate balance in the reserve fund.
Adopted: July 31, 1992,
Revised: August 2008
Revised: June 21 2017