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Financial Reserves Act

Posted: Sat Jun 08, 2019 4:04 am
by Sudane Erato
There was a brief mention and discussion of the Financial Reserves Act at the last RA meeting. I thought I would insert this brief status note into the forum so that people know how it's currently being administered.

The Act mentions a "separate account". There is indeed a "special account" holding CDS reserve funds... accounts in the CDS are avatars, so this avatar is another alt I maintain, LadyJane Rhys. However, she holds NOT the reserve funds described in the Act, but the larger quantity of reserve funds which the CDS has fortunately accumulated over its history. This fund can easily be identified on the monthly financial report. To my recollection, it has been touched only once, when we used some reserve funds to help pay for the "Buy Down" which LL briefly offered to enable us to have the old, grandfathered tier amount for our monthly payments.

The reserve funds referred to in the Act are actually kept in Rudeen's account. Each month when we sell L$s to convert them to US$s for tier payment to LL, I make sure that the amount in Rudeen's account is fully TWICE what we will need for tier. That double amount is the reserve specified in the Act, and it is available for the various things specified in the Act. The only reason for not keeping the money in a separate account as specified is to avoid the need for YET ANOTHER alt!

Hope that provides some clarity. As always, please don't hesitate to send money questions my way.


Re: Financial Reserves Act

Posted: Sun Jun 09, 2019 10:18 am
by Rosie Gray
For those curious, here is the act in its entirety:

NL 4-6 Financial Reserves Act

The city shall move 1 month’s tier in USD to a separate line item (reserve account), and make those funds unavailable for other use.

Funds in the account shall be disbursed at the discretion of the RA to pay recurring expenses in the event of a sudden and unexpected drop in $USD income.

The city shall augment this account as funds are available until it contains enough funds to pay all recurring city expenses for a period of two months absent other income.
passed 8 February 2006
My proposal to modify this act is to remove the last line since it refers to 'the city', and because we no longer have to augment the account.