Leelanau County General Fund Balance Reserves

April 2025
Report for the Public and Commissioners

Leelanau County
General Fund Balance Reserves

For several years, Leelanau County General Fund monies held in reserve have hovered around $1.6 million at a low point in the calendar year, typically at the end of July. While the county has many other assets—including Delinquent Tax Revolving Funds and revenues from millages dedicated to senior services and early childhood development—it is the General Fund revenues that are available for any unexpected expenses that arise in the county.

While $1.6 million may seem like a significant amount, its percentage in proportion to increasing expenses is declining:

• 2017 audited General Fund expenditures: $13 million (12.3%)

• 2018 audited General Fund expenditures: $13.5 million (11.9%)

• 2019 audited General Fund expenditures: $13.7 million (11.7%)

• 2024 unaudited General Fund expenditures: $17.5 million (9.1%)

This trend is concerning. A rule established by the Government Finance Officers Association (GFOA), under the title Best Practices: Fund Balance Guidelines for the General Fund, states:

Appropriate Level:
The adequacy of unrestricted fund balance in the general fund should take into account each government’s own unique circumstances... Nevertheless, GFOA recommends, at a minimum, that general-purpose governments—regardless of size—maintain an unrestricted budgetary fund balance in their general fund of no less than two months of regular general fund operating revenues or regular general fund operating expenditures.

Two months represents approximately 16.6% of a calendar year.