The fiscal year begins on July 1 and ends on June 30 of the following year. Because Livermore is a general law city, it is not subject to a budgetary process prescribed by statute or charter. The operating budget is subject to supplemental appropriations throughout its term in order to provide flexibility to meet changing needs and conditions. A resolution approving a supplemental appropriation is necessary when the original total appropriations for that fund would be exceeded. Budget adjustments within the same fund may be approved by the City Manager.
Unencumbered appropriations lapse at the end of each biennial budget period.
The operating budget is on a program basis. Organizational priorities which have been developed by City Council and city staff are implemented at the program level. Proprietary funds are budgeted on a budgetary operating reserve basis, which is defined as GAAP basis working capital less cash equivalent to the amounts set aside for Contingency and Equipment Replacement Reserves. For example, capital outlays and principal retirements on long term debt are budgeted, but depreciation and costs of issuance amortization are not. Under encumbrance accounting, purchase orders, contracts and other commitments for the expenditure of monies are recorded in order to reserve that portion of the applicable appropriation.