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CITY OF PARIS <br />CASH RESERVES POLICY <br />This policy is intended to establish and describe the basic guidelines and policies for maintaining a <br />minimum balance of cash reserves for the City's General Fund and Water & Sewer Fund. <br />1. An amount equal to five months of the most recently adopted General Fund operating budget <br />(inclusive of capital items but exclusive of debt service) shall be maintained as a minimum cash <br />balance at all times. <br />2. An amount equal to four months of the most recently adopted Water & Sewer Fund operating <br />budget (inclusive of capital items but exclusive of debt service) shall be maintained as a <br />minimum cash balance at all times. <br />3. Should an emergency or catastrophic event require the expenditure of all or part of these cash <br />reserves, the cash reserve depleted will be replenished within twelve months of dropping below <br />the minimum required amount. <br />4. Cash reserves may not be used for routine operating expenditures or capital projects that <br />should rightly be funded as part of the normal operating budget. <br />5. These cash reserves are independent of any new reserve requirement specified by a bond <br />covenant or other contract. <br />31 <br />