Fund Accounting

Fund Accounting

A local government’s General Fund receives money that is the most flexible in terms of how City Council can spend it.  Typically, a city’s General Fund is fed by sources of revenue such as income tax, which can be spent by that community’s City Council for any lawful purpose.  Around the state, communities spend General Fund dollars for policing, fire and emergency medical services, parks, roads, economic development and job creation, general municipal functions, operating libraries, supporting cultural activities, sponsoring community events, and providing other similar services.

A General Fund is in sharp contrast to other types of government funds that are often restricted by law as to what the money can be spent on.  For example, a city’s water fund only receives money from water bill payments, and water fund money can only be spent on water services.  City Councils have the ability to raise water rates to generate more money when deemed necessary because of rising energy costs, the need to replace water lines, or other inflationary costs.  City Councils in Ohio cannot simply raise property taxes or the income tax rate to generate more money for its General Fund, however.  Therefore, unlike balancing a water fund (or other similar type of enterprise fund), balancing a municipality’s General Fund can to be more difficult.

Again, Loveland’s General Fund finances services provided by the Loveland Police Department, a portion of the City’s overall Road Rehabilitation program, support for Loveland’s park system and services delivered from City Hall.