Long-term financial planning The County’s budget is developed for a five-year horizon. Each department prepares a five-year financial plan that addresses financial sustainability and efficient delivery of services. A five-year capital improvement program has been developed and integrated into the five-year financial plans. Management has developed fiscal policies for the adopted financial plan regarding reserves, transfers, capital improvements, fund balances, and revenues. The Board of County Commissioners has formally adopted a Debt Management Policy, an Investment Policy, and a Financial Reserves Policy. The Investment Policy is described in Note 1, Section D to the financial statements and the Financial Reserves Policy is described in Note 1, Section Q to the financial statements. Both Fitch and Standard & Poor’s, national bond rating agencies, reflect the County as having a AAA General Obligation (G.O.) Bond rating. The General Fund’s fund balance increased from $117.8 million at September 30, 2022 to $144.9 million at September 30, 2023. The majority (82.8 percent) of the General Fund’s fund balance of $144.9 million has been classified in accordance with the Financial Reserves Policy including provisions for a Contingency/Emergency/Disaster Relief Reserve, a Budget Stabilization/Economic Uncertainty Reserve, and a reserve for compensated absences (unpaid but earned vacation and sick leave), leaving an assigned subsequent years expenditure budgetary fund balance (fund balance budgeted to be used in fiscal year 2024) of $22.9 million (15.8 percent). Relevant financial policies Consistent with the County’s Debt Management Policy, outstanding debt is continually monitored in relation to existing conditions in the debt market. When sufficient cost savings can be realized, the debt will be refunded. The Investment Policy was established by ordinance in 1989 and most recently amended in September 2023. The Investment Policy emphasizes safety of capital as the highest priority. To ensure the safety and the protection of the public’s assets, the investment portfolio shall be designed with the annual objective of exceeding the average return on the corresponding Treasury maturity, based on the portfolio’s average duration. The portfolio is actively managed to maximize the return on investments by diversifying maturity dates and asset classes. The portfolio is structured to provide sufficient liquidity to pay current obligations. Sarasota County continues to uphold prestigious recognition from the Association of Public Treasurers of the United States and Canada (APT US&C) for its investment policy and maintains the Association’s Investment Policy Certificate of Excellence Award. This is the fourth time Sarasota County has received this accreditation and denotes the County has a sound investment policy founded upon professional standards to assist in ensuring prudent management of public funds. Additionally, the Sarasota County Investment Policy holds an “AAAf” International Fund Credit Quality Rating (FCQR) and “S1” Fund Market Risk Sensitivity Rating (MRSR) based on Fitch Ratings. The rating reflects Fitch’s review of the portfolio’s investment and credit guidelines, the portfolio’s credit quality and diversification. The “AAAf” FCQR indicates the highest underlying credit quality (or lowest vulnerability to default.) The “S1” MRSR indicates a very low sensitivity to market risk. 13
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