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4646 Dakota Street SE
Prior Lake. MN 55372
CITY COUNCIL AGENDA REPORT
MEETING DATE: September 19, 2011
AGENDA #: 513
PREPARED BY: JERILYN ERICKSON, FINANCE DIRECTOR
PRESENTED BY: JERILYN ERICKSON, FINANCE DIRECTOR
AGENDA ITEM: CONSIDER APPROVAL OF AUGUST 2011 TREASURER'S REPORT
DISCUSSION: Introduction
The purpose of this agenda item is for the Council to consider approval of
the monthly Treasurer's Report for August, 2011.
This information is being provided in a format which categorizes the
balances by fund type. A second page is included to provide the Fund
Balance Classification for each of the funds as well as the restrictions
placed upon their usage. Even though a fund have an "unrestricted" or
"unreserved" fund balance classification, it does not necessarily mean that
the balance is available to appropriate to other funds for other uses. There
be constraints in place due to the type of fund (i.e. debt service fund), the
contractual obligations (i.e. developer or tax increment agreements) or as
communicated when the fund was established.
For example, TIF Capital Project Funds have an "unreserved- designated
for improvements" fund balance classification. These funds are
contractually obligated by tax increment agreements in place so they are
not available to appropriate for other City uses. Upon decertification of a
TIF district, any residual funds will be sent to Scott County to be
redistributed to the city, school and county.
The business -type funds have "unrestricted" fund balance classifications.
In the case of the Transit Fund, we receive funds from the Met Council for
transit - related uses. Any remaining fund balance in the Transit Fund
cannot be appropriated for other City uses. To use the fund balances in
the Water, Sewer and Water Quality Funds for something other than what
was indicated on the utility bill would misrepresent the intent of the fees that
were charged.
The funds that have balances which have been identified for a particular
purpose such as equipment replacement or downtown building fagade
improvements can be appropriated for other City uses as determined by
the Council. Certain long -term plans in the Capital Improvement Program
have been established which support the balances in these funds. Council
would need to consider the financial impact of appropriating these balances
for other uses.
Further description of the constraints on other funds is reflected on the
second page of the report.
Current Circumstances
Staff has prepared a preliminary summary of the activity in the fund
balances for the month of August, 2011. The Treasurer's Report reflects
beginning cash balance, receipts, disbursements, and the ending cash
balance for each fund for the month of August, 2011. Interest earned is
allocated to each fund on a monthly basis and based upon each individual
fund's proportionate share of the total cash balance. The Report details
each fund balance classification. The Report is preliminary, unaudited, and
change. In most instances these funds were established and restricted for
specific and designated purposes by either Minnesota Statutes or City
Code to accomplish the goals and objectives of the City of Prior Lake. The
attached memorandum provides a summary of the fund descriptions.
On August 15, 2011, the City Council approved resolution #11 -100 to close
the Building Fund (F420) and establish the Facilities Management Fund
(F440) as outlined in the Facilities Management Plan (FMP). The FMP is a
new component to our Capital Improvement Program that identifies the
existing inventory, installation date, life expectancy and value of equipment
on a long term basis (25 years) for all of our facilities. The FMP provides a
schedule for MAJOR repairs, replacements and upgrades. It does not
cover minor expenses for repairs and maintenance. Those will continue to
be funded through the operating budgets.
If Council members have questions, please feel free to contact me at 952-
447 -9841 for more information.
ALTERNATIVES: 1. A motion as part of the consent agenda to approve the August, 2011
Treasurer's Report as submitted.
2. Take no action and provide the staff with specific direction.
RECOMMENDED Alternative 1. A motion as part of the consent agenda to approve the
MOTION: August, 2011 Treasurer's Report as submitted.
ATTACHMENTS: 1. City of Prior Lake August, 2011 Treasurer's Report
2. Treasurer's Report Fund Descriptions
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TREASURER'S REPORT FUND DESCRIPTIONS
General Fund - The General Fund represents the necessary resources to support general operating
budget expenditures of the City. The year -end fund balance represents dollars that have
accumulated over a period of time as a result of cumulative budgetary revenue surpluses and
expenditure under runs. The City Council has designated a portion of this amount, equal to a
minimum of 45% of the current operating budget, for working capital to finance city operations.
Sewer & Water Fund - The Sewer and Water Fund accounts for the collection of sewer and water
billing utility revenue. This enterprise fund balance is allocated for the operational costs of the
Water /Sewer departments and normally reserved for large capital municipal system expenses.
Water Quality Fund - The Storm Water Fund is an enterprise account funded by the $7.25 storm
water charge on the utility bills. The funds in the account are dedicated to finance water quality
improvements including departmental administration, storm water maintenance operations and
improvement projects related to water quality.
Transit Fund - The Transit Fund is an enterprise account funded predominantly (90 %) by state
aid that is derived from the vehicle excise tax paid through annual license tab renewals on
vehicles. The receipts are dedicated to pay for community transit services such as the downtown
commuter service, van pool and dial -a -ride services.
Cable Franchise Fund - This fund was created to act as a clearing house for funds that were
received from the cable franchise company as specified by ordinance.
Capital Park Fund - Capital Park funds are dedicated funds received from developers in
accordance with the City's Park Dedication requirement when land is platted. Funds are
collected for the purpose of developing the City's neighborhood park and trail system. These
dollars are programmed throughout the course of the City's Capital Improvement Program.
Severance Compensation Fund - This fund was established to partially fund the City's
compensated absence liability which is associated with the accrued vacation and sick leave for
employees upon employment termination. The State Auditor's Office has recommended that
local governments set aside a certain percentage on the basis of foreseeable turnover.
ED Special Revenue — This fund is reserved and expended at the direction of the Prior Lake
Economic Development Authority for specific economic development activity as allowed by MN
Statute. The purpose is to provide economic incentives for new business expansion within the
community.
ED Fed/MN Loan Funds - These funds were created to account for the proceeds of economic
development grants received either from the federal government or the State of Minnesota to
provide seed money for a revolving loan account. The purpose is to provide economic incentive
for new business expansion within the community.
Downtown Redevelopment Fund - This fund was created to provide development assistance in
the context of building facade improvements for downtown businesses in an effort to revitalize
and renew business activity and the general appearance of the downtown business district.
DAG Special Revenue Fund - The DAG Fund is a special revenue fund related to the costs the
City incurs in connection with a subdivision. The fees are paid to the City by the developer when
the Development Contract and Final Plat are approved by the City Council. These revenues are
used to pay for legal expenses incurred in connection with review and approval of the plat and
inspection services on developer installed - utilities including sewer, water and street installation
for newly approved subdivisions within the City of Prior Lake.
Water Revenue Bond Fund — PW Bldg - This fund is a debt service fund to pay the bonds that
were issued to construct the public works maintenance building. The capital facility (CFAC)
charge of $10.00 that is generated on the bi- monthly water and sewer bill provides the funding
for the bond payments which occur semi - annually in June and December of each year. Upon
demand the funds are transferred from the Sewer and Water Fund.
Water Revenue Bond Fund — wT Plant - This fund is a debt service fund to pay the bonds that
were issued to construct the water treatment plant. Revenue from the water and sewer bills
provides the funding for the bond payments which occur semi - annually in June and December of
each year. Upon demand the funds are transferred from the Sewer and Water Fund.
Tax Increment Funds - The Tax Increment Fund represents an accumulation of funds such as
bond proceeds and project administration fees charged to companies requesting project write-
downs in the form of tax increment financing for new and /or redevelopment. The TIF district
property taxes are then deposited in a number of tax increment funds established to track their
respective revenue.
Revolving Equipment Fund - A regular replacement schedule for equipment needs of the City in
excess of $5,000 has been adopted. Periodic fund transfers are appropriated to provide a funding
source for the acquisition and purchase of new and replacement vehicles and equipment. The
long term effect of appropriating fund transfer is to mitigate property tax increases and eliminate
debt financing.
Building Fund - The funds within the Building Fund are reserved for future building needs. This
Fund was closed on 08/15/2011 per council resolution #11 -100.
Revolving Park Equipment Fund — This Fund was established in 2009 in conjunction with the
Park Equipment Replacement Plan to fund replacement of park equipment.
Facilities Management Fund — This Fund was established on 08/15/2011 per council resolution
#11 -100 in conjunction with the Facilities Management Plan (IMP). The FMP provides a
schedule of major repairs, replacements and upgrades to all of the City facilities.
Construction Fund - Construction Fund dollars represent unexpended bond proceeds that are
reserved to pay for improvement projects that have been approved by the City Council on an
annual basis. For the most part, these moneys are necessary to complete outstanding construction
contracts and related engineering and professional services.
Street Oversize Fund - The Collector Street Fund consists of dedicated revenue generated by fees
associated with new development and new construction building permits for the purpose of
funding pedestrian related improvements i.e., bikeways, sidewalks, trail systems plus right of
way acquisition along collector streets and occasional collector street links.
Trunk Reserve Fund - The Trunk Reserve Fund consists of dedicated revenue generated from
utility connection permits and acreage fees assessed at time of sewer and water installation for
the purpose of recovering trunk oversizing costs and central municipal system improvements i.e.,
wells lift stations, force mains, etc. These dollars are programmed throughout the course of the
City's capital improvement plan.
Water Storage Fund - The Water Storage Fund accounts for the water tower fee that is charged
and collected on building permits. This fund balance is 100% reserved for the construction of
elevated and ground water storage facilities.
Debt Service Funds - The Debt Service Fund represents prepayments of special assessments,
property tax collections and special levies needed to pay the outstanding bonded indebtedness of
the City. This fund balance is 100% reserved for the payment of bond principal and interest.
Agency Fund - The Agency Fund accounts for the $1500 residential building permit deposit that
is refunded to the building contractor upon final inspection. This provides the City the required
financial assurance that the property site will be adequately cleaned up and debris free before an
occupancy permit is granted.
OF PRIOP
City of Prior Lake
U Treasurers Report
August, 2011
Governmental -Type Funds
General Fund 101 $ 7,691,819.54 $ 1,405,625.46 $ 1,939,899.82 $ 7,157,545.18
Special Revenue Funds
Fund
811/2011
8/31/2011
Fund Type & Name
No.
Balance
Receipts
Disbursements
Balance
Business -Type Funds
-
$
45,288.16
Capital Park Fund
225
Water Fund
601
$ 2,555,357.71
$ 520,857.65
$ 756,299.02 $
2,319,916.34
Sewer Fund
604
2,635,925.72
382,314.42
476,582.67
2,541,657.47
Water Quality Fund
602
391,680.91
69,532.38
253,585.64
207,627.65
Transit Fund
603
1,718,300.88
84,053.77
83,054.92
1,719,299.73
Total Business -Type Funds
309.90
$ 7,301,265.22
$ 1,056,758.22
$ 1,569,522.25 $
6,788,501.19
Governmental -Type Funds
General Fund 101 $ 7,691,819.54 $ 1,405,625.46 $ 1,939,899.82 $ 7,157,545.18
Special Revenue Funds
Cable Franchise Fund
210
$ 45,288.16
$ -
$
-
$
45,288.16
Capital Park Fund
225
145,799.71
1,462.66
920.19
146,342.18
Severance Compensation
230
539,484.38
3,232.01
-
542,716.39
EDA Special Revenue
240
103,248.98
286.59
1,901.62
101,633.95
Econ Dev Federal Revolving Loan Func
250
109,590.71
309.90
-
109,900.61
Econ Dev MN Revolving Loan Fund
255
85,102.88
240.66
-
85,343.54
Developer Agreement Fund
260
708,668.64
43,041.00
30,769.83
720,939.81
Total Special Revenue Funds
$ 1,737,183.46
$ 48,572.82
$
33,591.64
$
1,752,164.64
Capital Project Funds
Downtown Redevelopment Fund
256
$ 39,874.57
$ 112.76
$
-
$
39,987.33
Tax Increment
402
177,545.17
500.69
488.00
177,557.86
TIF #1 -3
413
114, 373.42
319.20
1,494.00
113,198.62
TIF #3 -1
414
48,537.85
137.21
18.00
48,657.06
TIF #4 -1
415
3,732.03
10.50
18.00
3,724.53
TIF #5 -1
416
2,868.96
8.06
18.00
2,859.02
TIF #6 -1
417
93, 546.80
264.48
18.00
93, 793.28
Revolving Equipment Fund
410
1,502,404.52
4,021.01
103,209.03
1,403,216.50
Building Fund (Closed0811W011)
420
430,565.65
-
430,565.65
-
Revolving Park Equipment Fund
430
212,845.11
601.89
-
213,447.00
Facilities Management Fund (NEM
440
-
431,783.22
-
431,783.22
Construction Fund
501
447,564.15
1,030,638.47
358,802.57
1,119,400.05
Trunk Reserve Fund
502
1,179,737.16
29,465.78
-
1,209,202.94
Street Oversize Fund
503
430,399.10
2,352.30
-
432,751.40
Water Storage Fund
505
287,505.84
14,852.61
-
302,358.45
Total Capital Project Funds
$ 4,971,500.33
$ 1,515,068.18
$
894,631.25
$
5,591,937.26
Debt Service Funds
5xx
$ 2,341,816.21
$ 17,955.10
$
15,310.00
$
2,344,461.31
Agency Fund
801
$ 187,600.00
$ 19,500.00
$
22,500.00
$
184,600.00
Total Governmental Type Funds
$ 16,929,919.54
$ 3,006,721.56
$ 2,905,932.71
$ 17,030,708.39
Total All Funds
$ 24,231,184.76
$ 4,063,479.78
$ 4,475,454.96
$ 23,819,209.58
Investment Pool & Ratio
$ 23,575,387.36
98.98%
This report does not reflect financial obligations from contracts, agreements, purchases, services received, etc.
OF PR)O$
City of Prior Lake
0 Treasurers Report
August, 2011
Fund Type & Name Fund Balance Classification Constraints
Business -Type Funds
Water Fund Unrestricted Identified on utility bill for this purpose
Sewer Fund
Water Quality Fund
Transit Fund
Unrestricted
Unrestricted
Unrestricted
Identified on utility bill for this purpose
Identified on utility bill for this purpose
Funds received for transit - related uses
Governmental -Type Funds
General Fund
Unreserved
Cashflow, emergencies, one -time opportunities
Special Revenue Funds
Cable Franchise Fund
Unreserved; Designated for Capital Outlay
Statutory obligation to use for PEG access
Capital Park Fund
Unreserved; Designated for Improvements
Contractually obligated; park dedication fees
Severance Compensation
Reserved for Severance Compensation
Reserved for Severance Compensation
EDA Special Revenue
Unreserved; Designated for Improvements
Economic Development
Econ Dev Federal Revolving Loan Fund
Unreserved; Designated for Development Loans
Economic Development
Econ Dev MN Revolving Loan Fund
Unreserved; Designated for Development Loans
Economic Development
Developer Agreement Fund
Unreserved; Designated for Improvements
Contractually obligated;
Capital Project Funds
Downtown Redevelopment Fund
Tax Increment
Unreserved; Designated for Improvements
Unreserved; Designated for Improvements
Unreserved; Designated for Improvements
Unreserved; Designated for Improvements
Unreserved; Designated for Improvements
Unreserved; Designated for Improvements
Unreserved; Designated for Improvements
Unreserved; Designated for Capital Outlay
Unreserved; Designated for Capital Outlay
Identified for downtown building fagade improvements
Contractually obligated by tax increment agreements
Contractually obligated by tax increment agreements
Contractually obligated by tax increment agreements
Contractually obligated by tax increment agreements
Contractually obligated by tax increment agreements
Contractually obligated by tax increment agreements
Identified for equipment replacement
Identified for funding Facilities Management Plan (future)
TIF #1 -3
TIF #3 -1
TIF #4 -1
TIF #5 -1
TIF #6 -1
Revolving Equipment Fund
Building Fund
Revolving Park Equipment Fund
Facilities Management Fund
Construction Fund
Trunk Reserve Fund
Street Oversize Fund
Water Storage Fund
Debt Service Funds
Unreserved; Designated for Capital Outlay Identified for park equipment replacement
Unreserved; Designated for Capital Outlay Identified for funding Facilities Management Plan
Unreserved; Construction projects in progress
Unreserved; Contractually obligated by developer agreements
Unreserved; Contractually obligated by developer agreements
Unreserved; Contractually obligated by developer agreements
Reserved for Debt Service Reserved for contractually obligated debt service
Agency Fund N/A Escrows to be reimbursed to depositors