2012 CAFR I
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City of Fridley
Minnesota
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Comprehensive Annual Financial Report • ••
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CITY OF FRIDLEY, MINNESOTA
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Comprehensive Annual Financial Report
For the Year Ended
' December 31, 2012
Prepared by:
' Finance Department
Darin R. Nelson
' Finance Director
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CITY OF
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FRIDLEY
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' CITY OF FRIDLEY, MINNESOTA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
I YEAR ENDED DECEMBER 31, 2012
TABLE OF CONTENTS
EXHIBIT PAGE
II. INTRODUCTORY SECTION
Letter of Transmittal 3
I Certificate of Achievement 9
Elected and Appointed Officials 10
City Administrative Organizational Structure 2012 12
III. FINANCIAL SECTION
Independent Auditor's Report 17
IManagements Discussion and Analysis 21
IBasic Financial Statements:
Government-Wide Financial Statements:
I Statement of Net Position A-1 33
Statement of Activities A-2 34
I Fund Financial Statements:
Balance Sheet-Governmental Funds A-3 36
Statement of Revenues, Expenditures and Changes in Fund Balances-
I Governmental Funds A-4 38
Reconciliation of the Statement of Revenues, Expenditures and Changes in
Fund Balances of Governmental Funds to the Statement of Activities A-5 41
Statement of Net Position - Proprietary Funds A-6 42
IStatement of Revenues, Expenses and Changes in Fund Net Position -
Proprietary Funds A-7 44
Statement of Cash Flows- Proprietary Funds A-8 46
IStatement of Fiduciary Net Position A-9 48
Notes to Financial Statements 49
IRequired Supplementary Information:
IBudgetary Comparison Schedule -General Fund B-1 86
Budgetary Comparison Schedule - Note to RSI 91
tSchedule of Funding Progress- Retiree Health Plan 92
I Combined, Combining and Individual Fund Statements and Schedules:
Combined Balance Sheet- Nonmajor Governmental Funds C-1 96
Combined Statement of Revenues, Expenditures and Changes in Fund Balances-
' Nonmajor Governmental Funds C-2 97
CITY OF FRIDLEY, MINNESOTA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
YEAR ENDED DECEMBER 31, 2012
TABLE OF CONTENTS
EXHIBIT PAGE
Combining Balance Sheet- Nonmajor Special Revenue Funds C-3 100
Combining Statement of Revenues, Expenditures and Changes in
Fund Balances- Nonmajor Special Revenue Funds C-4 102
Special Revenue Funds:
Cable TV Fund:
Comparative Balance Sheet D-1 104
Schedule of Revenues, Expenditures and Changes in Fund Balance-
Budget and Actual D-2 105
Grant Management Fund:
Comparative Balance Sheet D-3 106
Schedule of Revenues, Expenditures and Changes in Fund Balance-
Budget and Actual D-4 107
Solid Waste Abatement Fund:
Comparative Balance Sheet D-5 108
Schedule of Revenues, Expenditures and Changes in Fund Balance-
Budget and Actual D-6 109
Drug and Gambling Forfeiture Fund:
Comparative Balance Sheet D-7 110
Schedule of Revenues, Expenditures and Changes in Fund Balance-
Budget and Actual D-8 111
Police Activity Fund:
Comparative Balance Sheet D-9 112
Schedule of Revenues, Expenditures and Changes in Fund Balance-
Budget and Actual D-10 113
Springbrook Nature Center Fund:
Comparative Balance Sheet D-11 114
Schedule of Revenues, Expenditures and Changes in Fund Balance-
Budget and Actual D-12 115
Capital Project Funds:
Capital Equipment Fund:
Comparative Balance Sheet E-1 118
Schedule of Revenues, Expenditures and Changes in Fund Balance-
Budget and Actual E-2 119
Capital Improvement Fund: ,
Schedule of Revenues, Expenditures and Changes in Fund Balance -
Budget and Actual E-3 120
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' CITY OF FRIDLEY, MINNESOTA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
I YEAR ENDED DECEMBER 31, 2012
TABLE OF CONTENTS
IEXHIBIT PAGE
I Internal Service Funds:
Combining Statement of Net Position F-1 122
Combining Statement of Revenues, Expenses and Changes in Net Position F-2 123
ICombining Statement of Cash Flows F-3 124
Employee Benefits Fund:
I Comparative Statement of Net Position F-4 125
Comparative Statement of Revenues, Expenses and Changes in Net Position F-5 126
Comparative Statement of Cash Flows F-6 127
ISelf Insurance Fund:
Comparative Statement of Net Position F-7 128
Comparative Statement of Revenues, Expenses and Changes in Net Position F-8 129
IComparative Statement of Cash Flows F-9 130
Information Systems Fund:
I Comparative Statement of Net Position F-10 131
Comparative Statement of Revenues, Expenses and Changes in Net Position F-11 132
Comparative Statement of Cash Flows F-12 133
IHousing and Redevelopment Authority (Component Unit):
Balance Sheet-Governmental Funds G-1 136
I Statement of Revenues, Expenditures and Changes in
Fund Balances-Governmental Funds G-2 138
Subcombining Balance Sheet- Nonmajor Capital Project Funds G-3 140
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Subcombining Statement of Revenues, Expenditures and Changes in
Fund Balances- Nonmajor Capital Project Funds G-4 142
I Agency Funds:
Combining Statement of Assets and Liablilites H-1 146
Statement of Changes in Assets and Liabilities H-2 147
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CITY OF FRIDLEY, MINNESOTA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
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YEAR ENDED DECEMBER 31, 2012
TABLE OF CONTENTS
EXHIBIT PAGE
III. STATISTICAL SECTION (Unaudited)
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Financial Trends:
Net Position by Component Table 1 150
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Changes in Net Position Table 2 152
Fund Balances-Governmental Funds Table 3 156
Changes in Fund Balances-Governmental Funds Table 4 158
Revenue Capacity:
Tax Capacity Value and Estimated Market Value of Taxable Property Table 5 160 I
Direct and Overlapping Property Tax Capacity Rates Table 6 162
Principal Property Taxpayers Table 7 164
Debt Capacity:
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Property Tax Levies and Collections Table 8 165
Ratios of Outstanding Debt by Type Table 9 166
IDirect and Overlapping Govermental Activities Debt Table 10 168
Demographic and Economic:
Legal Debt Margin Information Table 11 169
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Pledged Revenue Coverage Table 12 170
Operating Information: I
Demographic and Economic Statistics Table 13 172
Principal Employers Table 14 173
Full-Time Equivalent City Government Employees by Function/Program Table 15 174 I
Operating Indicators by Function/Program Table 16 176
Capital Asset Statistics by Funciton/Program Table 17 178
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I. INTRODUCTORY SECTION
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C ITY O F
FRIDLEY
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City of Fridley
FRIDLEY MUNICIPAL CENTER•6431 UNIVERSITY AVE.N.E.FRIDLEY,MN 55432
(763)571-3450•FAX(763)571-1287•WWW.FRIDLEYMN.GOV
May 20, 2013
To the Citizens of the City of Fridley,
Mayor, Council Members, and City Manager
The Comprehensive Annual Financial Report of the City of Fridley, Minnesota, for the fiscal
year ended December 31, 2012, is submitted herewith:
Responsibility for both the accuracy of the presented data and the completeness and fairness of
the presentation, including all disclosures, rests with the City. We believe that the data, as
presented, is accurate in all material aspects, that it is presented in a manner designed to fairly
set forth the financial position and results of operations of the City as measured by the financial
activity of its various funds, and that all disclosures necessary to enable the reader to gain the
maximum understanding of the City's financial activity have been included.
Generally accepted accounting principals require that management provide a narrative
introduction, overview, and analysis to accompany the basic financial statements in the form of
Management's Discussion and Analysis (MD&A). This letter of transmittal is designed to
complement the MD&A and should be read in conjunction with it. The City of Fridley's
MD&A can be found immediately following the report of the independent auditors.
All City funds, departments, commissions and other organizations for which the City of Fridley
is financially accountable are presented within the Comprehensive Annual Financial Report.
The City provides a full range of services to its citizens. These services include, but are not
limited to, police and fire protection; water and sanitary sewer utilities; the construction and
maintenance of streets and infrastructure; recreational facilities; and general administrative
services. The Housing and Redevelopment Authority (HRA) is included in the reporting entity
as a component unit of the City, because the governing board is appointed by the City Council,
and because of the City's relationship of financial benefit or burden with the authority.
The organization, form and contents of this report were prepared in accordance with the
standards prescribed by the Governmental Accounting Standards Board (GASB), the
Government Finance Officers Association of the United States and Canada (GFOA), the
American Institute of Certified Public Accountants, the Minnesota Office of the State Auditor,
and the City Charter.
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CITY OF FRIDLEY, MINNESOTA
ECONOMIC CONDITION AND OUTLOOK
BACKGROUND AND LOCATION
The City of Fridley is a first ring suburban community with an estimated 2012 population of
27,790. The City is located 10 minutes north of downtown Minneapolis and 25 minutes
northwest of downtown St. Paul. Incorporated in July of 1949, Fridley covers 10 square miles
of area and is now home to some of the most important industries in the Midwest, nation, and
the world. An industrial spine around the rail corridor has served the City well and has
provided the city with nearly as many jobs as the number of citizens who reside in the
community. Fridley is home to the largest number of employees in Anoka County.
LOCAL ECONOMY
The local economy has been a mixed picture over the past year. New construction and
renovation activity has picked up over the last two years, unemployment numbers have
improved,but property values have again declined.
The value of new construction remained relatively stable compared to the prior year. The
construction value for 2012 amounted to approximately $35.8 million. This is about $2 million
less than 2011, but still about a 30% increase over just two years ago. The major projects for
2012 included the addition to and remodel of the Cummins Power Generation facility valued at
$2.4 million, Cub Foods remodel valued at $4.2 million, Sam's Club remodel valued at $2.5
million, and the Unity Hospital and professional building remodels at a combined value of$1.8
million. Continued long-term growth is anticipated as Fridley continues to aggressively pursue
redevelopment opportunities. Unfortunately, the estimated market value for all properties in
Fridley decreased 9.7% over the past year. This decline in valuation is consistent with other
municipalities in the Minneapolis-St. Paul metropolitan area.
MAJOR INITIATIVES
For the Year
2012 was a relatively quiet year compared to the prior year. In 2011, the City
experienced a number of extraordinary events including spring river flooding, a tornado,
and a 100 year rain event that caused a railroad bridge to fail resulting in a train
derailment. 2012 saw none of these extreme weather conditions, which provided some
much needed relief for both the public works and public safety budgets and personnel.
This lull in unplanned activity provided an opportunity for other planned projects to be
initiated. Those projects included:
1. The Street Program continued the on-going efforts of resurfacing city streets. The
2012 Street Program included streets within the Rice Creek, Meadowmore Terrace
and Flanery Park neighborhoods. The final cost of this project was approximately
$1.1 million.
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CITY OF FRIDLEY, MINNESOTA
ECONOMIC CONDITION AND OUTLOOK(CONTINUED)
2. The 2012 sanitary sewer lining project included continuation of lining 21" and 24"
concrete sanitary sewer mains along University Avenue from 57th Avenue to south of
I-694. This is a long-term system-wide plan to have 50% of the sewer mains lined by
2050. The 2012 costs for sewer lining was approximately $195,000.
3. The City entered its second year of a ten to twelve year campaign to replace the
City's approximately 7,500 manual read water meters with automatic meter reading
water meters. Public Works staff is undertaking the change-out in house, which saves
contractual costs and allows the city to more easily budget for new meters on an
annual basis rather than a large one-time purchase. Annual expenditure for the
purchase of new water meters is estimated to cost $125,000 per year.
4. The HRA created two new Tax Increment Financing (TIF) Districts in 2012. Both of
these districts are in the same location and are associated with redeveloping the
British Aerospace Engineering (BAE) property. The first TIF district is the
Hazardous Substance Sub-District which will provide assistance to the developer in
cleaning up contaminated soils on the property. This Hazardous Substance Sub-
, District is the first of its kind in Anoka County. The second TIF district is the BAE
TIF district which will help provide assistance to the developer in demolishing 2
million square feet of obsolete manufacturing space and replacing it with 1.6 million
square feet of commercial office and warehouse space in four phases over span of 10
to 12 years.
For the Future
The future for the City of Fridley will continue to be filled with change. Future State
legislative actions continue to cause the City to react on the fly, whether it's last minute
reductions to Local Government Aid (LGA) or political impasse on the State level. City
leadership is doing its due diligence to protect itself from these last minute legislative changes
that can have an immediate impact on the City's financial position. For example, the 2012
budget removed LGA from the General Fund and moved it to the Capital Improvements Fund,
designating it for building improvements. Since the General Fund consists mainly of
operational costs that are relatively consistent from year-to-year, including LGA in the General
Fund as a revenue stream caused a lot of uncertainty on whether or not budget projections
would be realized.
Recognizing the LGA as a one-time funding source in the Capital Improvements Fund
provides the City with more options if funding is reduced or not received in any one year. If
necessary, capital projects can be delayed, and by chance an unexpected allotment of LGA is
received,the City is able to move up future planned projects or complete delayed projects.
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CITY OF FRIDLEY, MINNESOTA
ECONOMIC CONDITION AND OUTLOOK(CONTINUED)
In addition, the City also undertook an in-depth review of its Water, Sewer and Storm Water
utility rates. As part of this process, the City projects fund balances and capital improvements
needs for each of the utility systems for the next twenty years and from that data projects
estimated user rates for each fund for that same time period. One goal of the review was to
determine necessary rate adjustments needed to reduce the City's dependence on debt
financing for yearly capital outlay.
Maintaining current service levels is a high priority for the City. Through the past several
years operating budgets have been reduced in order to balance budgets. These reductions have
forced City leadership to become more innovative and subsequently more efficient to maintain
service levels. The City will continue to investigate alternatives that will allow creative
solutions to the delivery of services.
FINANCIAL INFORMATION
INTERNAL CONTROLS
In developing and improving the City's accounting system, consideration is given to the
adequacy of internal accounting controls. Internal accounting controls are designed to provide
reasonable, but not absolute, assurance regarding the safeguarding of assets against loss from
unauthorized use or disposition and the reliability of financial records for preparing financial
statements and maintaining accountability for assets. The concept of reasonable assurance
recognizes that the cost of a control should not exceed the benefits likely to be derived and the
evaluation of costs and benefits requires estimates and judgments by management.
All internal control evaluations occur within the above framework. We believe that the City's
internal accounting controls adequately safeguard assets and provide reasonable assurance of
the proper recording of financial transactions.
BUDGETARY CONTROLS
A complete budgetary system of accounts is maintained for the General and Special Revenue
Funds. Budgetary control is maintained in compliance with the City Charter requirements.
The Charter provides that it is the duty of the City Manager to strictly enforce the provisions of
the budget. The management policy of the City is such that the existence of a particular item
or appropriation in the approved budget does not mean that it will or must be automatically
expended. It is the policy of the City to control budgets at the expenditure category level.
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CITY OF FRIDLEY, MINNESOTA
FINANCIAL INFORMATION (CONTINUED)
Budget adjustments between City divisions are made upon the approval of a resolution by the
City Council. The City Charter provides that the City Council shall not have power to increase
the total amount of the budget, whether by insertion of new items or otherwise, beyond the
estimated revenue unless the actual revenue exceeds such revenue estimates, and in that event
not beyond such actual revenue. There is a constant review process.
Expenditures are not approved until it has been determined that 1) the expenditure is necessary,
2) adequate funds have been appropriated, and 3) funds are available.
FUND BALANCE POLICY
The purpose of the fund balance policy is to establish appropriate fund balance levels for each
fund that is primarily supported by property tax revenues or user fees. These policies will
ensure that adequate resources are available to meet cash flow needs for carrying out the
regular operations of the City. The funds addressed in this policy include the General Fund,
Solid Waste Abatement Fund, Springbrook Nature Center Fund and Enterprise Funds. In
2012, all the funds addressed by this policy, with the exception of the Sewer Enterprise Fund,
met the fund balance guidelines. The Sewer Enterprise Fund, along with the other utility
enterprise funds, have all implemented a multi-year plans to ensure long-term sustainability.
The Sewer Enterprise Fund is expected to meet minimum fund balance requirements within the
next couple years.
INVESTMENT POLICY
The purpose of the investment policy is to develop an overall program for cash investments,
designed and managed with a high degree of professionalism, worthy of the public trust; to
establish that elected and appointed officials and employees are custodians of a portfolio which
shall be subject to public review; to establish cash investment objectives, delegation of
authority, standards of prudence, internal controls, authorized investments, selection process
for investments, and broker representations.
The investment policy outlines the investing philosophy and practices of the City of Fridley
and the Fridley Housing and Redevelopment Authority, and has been developed to serve as a
reference point for the management of City assets. It is the policy of the City to invest public
funds in a manner which will provide for safety, liquidity, and yield in that order of
importance. Investments will conform to all federal, state and local regulations governing the
investment of public funds.
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CITY OF FRIDLEY, MINNESOTA
OTHER INFORMATION
INDEPENDENT AUDIT
Section 7.13 of the City Charter requires an annual audit to be made of the books of account,
financial records and transactions of all administrative departments of the City by a certified
public accountant or the State Auditor's Office of the State of Minnesota. The accounting firm
of HLB Tautges Redpath, Ltd. was engaged by the City to render an opinion on the City's
financial statements. The auditor's report on the basic financial statements and combining and
individual fund statements and schedules is included in the Financial Section of this report.
AWARDS
The Government Finance Officers Association of the United States and Canada (GFOA)
awarded a Certificate of Achievement for Excellence in Financial Reporting to the City of
Fridley for its comprehensive annual financial report for the fiscal year ended December, 31,
2011. In order to be awarded a Certificate of Achievement, a government must publish an
easily readable and efficiently organized comprehensive annual financial report. This report
must satisfy both generally accepted accounting principles and applicable legal requirements.
A Certificate of Achievement is valid for a period of one year only. We believe that our
current comprehensive annual financial report continues to meet the Certificate of
Achievement Program's requirements and are submitting it to the GFOA to determine its
eligibility for another certificate.
ACKNOWLEDGMENTS
The preparation of this report on a timely basis could not have been accomplished without the
efficient and dedicated services of all members of the Finance Department, with special
recognition to Carol Meyer, Rebecca Kiernan, Greg Tirevold, Jean Michaels, and to our
auditors HLB Tautges Redpath, Ltd. for their professional guidance. We would also like to
express our appreciation to the Mayor and members of the City Council for their interest and
support in planning and conducting the financial operations of the City in a responsible and
progressive manner.
Respectfully submitted,
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Darin Nelson Shelly Peterson
Finance Director Assistant Finance Director
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Certificate of
Achievement
for Excellence
in Financial
Reporting
Presented to
City of Fridley
Minnesota
For its Comprehensive Annual
Financial Report
for the Fiscal Year Ended
December 31, 2011
A Certificate of Achievement for Excellence in Financial
Reporting is presented by the Government Finance Officers
Association of the United States and Canada to
government units and public employee retirement
systems whose comprehensive annual fmancial
reports(CAFRs)achieve the highest.
standards in government accounting
and fmancial reporting.
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CITY OF FRIDLEY, MINNESOTA
ELECTED AND APPOINTED OFFICIALS
DECEMBER 31, 2012
ELECTED OFFICIALS
Term of Office
Expires December
Mayor Scott J.Lund 2012
Councilmember At Large Robert L. Barnette 2012
Councilmember, Ward I James T. Saefke 2014
Councilmember, Ward II Dolores M. Varichak 2014
Councilmember, Ward III Ann R. Bolkcom 2014
APPOINTED OFFICIALS
City Manager William W. Burns
City Attorney Darcy M. Erickson
Prosecuting Attorney Carl J. Newquist
City Clerk Debra A. Skogen
Department Heads:
Finance Director/Treasurer Darin R. Nelson
Director of Public Safety and Civil Defense Donovan W. Abbott
Fire Chief John D. Berg
Director of Public Works James P. Kosluchar
Director of Parks and Recreation Jack G. Kirk
Director of Community Development Scott J. Hickok
Director of Human Resources Deborah K. Dahl
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CITY OF
FRIDLEY
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CITY ADMINISTRATIVE ORGANIZATIONAL STRUCTURE 2012
City of Fridley
General Fund Authorized Full-Time(Minimum Of 32 Hours A week) Positions - 103 (A)
Total Authorized Full-Time(Minimum Of 32 Hours A week) Positions - 127 (A)
rev.10/26/11
CITY MANAGEMENT (2)
City Manager
Admin Assistant to the City Manager
Non-General Fund
CABLE TV FUND
Cable Administrator
FINANCE (20) POLICE (44) FIRE (8)
Finance Director-Treasurer Public Safety Director Fire Chief
Accountant Administrative Assistant Administrative Assistant
Assistant Chief
ACCOUNTING (4) FIELD OPERATIONS (28) (3) Captains
Assistant Finance Director Captain
Payroll Coordinator (5) Sergeants
Accounting Specialist (22) Patrol Officers
Acctg-Data Processing Clerk RENTAL INSPECTIONS (2)
Rental Inspection Asst.
ASSESSING (2) TECHNICAL SUPPORT (14) Full-time Firefighter
City Assessor Captain
Appraiser Lieutenant
(3) Detectives HUMAN RESOURCES (2)
MIS (2) Pawn Detective
IT Manager (2) School Resource Officer Human Resources Director
PC Technician Anoka-Henn DTF Sergeant Administrative Assistant
Special Projects Coordinator
CITY CLERK- RECORDS (2) Crime Prevention Specialist
City Clerk Office Supervisor
Licensing & Records Technician (2) Police Technicians
(Also 3 at 32 hrs/week)
Non-General Fund
LIQUOR(5)
Liquor Operations Manager
(4) Lead Liquor Store Clerks
WATER ADMIN (2)
Utility Billing Clerk
Acctg-Data Processing Clerk
HRA/WATER ADMIN (1)
Acctg/Admin Specialist
(A)An"Authorized Position"is defined as one that works at least 32 hours a week and receives a full-time benefit package.
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PUBLIC WORKS (34) PARKS & COMMUNITY
RECREATION (8) DEVELOPMENT (9)
Public Works Director
Admin Assist/Main't Coord Parks & Recreation Director Community Development
Recreation Office Coordinator D irector
(2) Program Supervisors Office Coordinator
ENGINEERING (3) Sr Citizens Program Supervisor
Assistant Public Works Director BUILDING INSPECTION (3)
(2) Engineering Technician Chief Building Official
Building Inspector
PW MAINTENANCE (19) Permit Technician
Fleet Services Supervisor PLANNING
(2) Mechanic Planning Manager
Street Supervisor
(8) Public Service Worker
Parks Supervisor
(6) Public Service Worker
Non-General Fund Non-General Fund Non-General Fund
WATER(5) SPRINGBROOK NATURE SOLID WASTE
Water Supervisor CENTER(3) Environmental Planner
(4) Public Service Worker Nature Center Director
Program Supervisor SECTION 8 HOUSING
SEWER(5) Program Admin Assist Coordinator(32 hrs/week)
Sewer Supervisor
(4) Public Service Worker HRA
Assistant Executive Director
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CITY OF
FRIDLEY
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II. FINANCIAL SECTION
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CITY OF
FRIDLEY
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HLB TAUTGES
fi REDPATH, LTD.
Certied PubiicAccountants
INDEPENDENT AUDITOR'S REPORT
To the Honorable Mayor and
Members of the City Council
City of Fridley, Minnesota
Report on the Financial Statements
We have audited the accompanying financial statements of the governmental activities, the
business-type activities, each major fund, and the aggregate remaining fund information of the
City of Fridley, Minnesota, as of and for the year ended December 31, 2012, and the related
notes to the financial statements, which collectively comprise the City's basic financial
statements as listed in the table of contents.
Management's Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements
in accordance with accounting principles generally accepted in the United States of America;
this includes the design, implementation, and maintenance of internal control relevant to the
preparation and fair presentation of financial statements that are free from material misstatement,
whether due to fraud or error.
Auditor's Responsibility
Our responsibility is to express opinions on these financial statements based on our audit. We
conducted our audit in accordance with auditing standards generally accepted in the United
States of America and the standards applicable to financial audits contained in Government
Auditing Standards, issued by the Comptroller General of the United States. Those standards
require that we plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and
disclosures in the financial statements. The procedures selected depend on the auditor's
judgment, including the assessment of the risks of material misstatement of the financial
statements, whether due to fraud or error. In making those risk assessments, the auditor
considers internal control relevant to the entity's preparation and fair presentation of the
financial statements in order to design audit procedures that are appropriate in the circumstances,
but not for the purpose of expressing an opinion on the effectiveness of the entity's internal
control. Accordingly,we express no such opinion. An audit also includes evaluating the
appropriateness of accounting policies used and the reasonableness of significant accounting
4810 White Bear Parkway White Bear Lake,MN 55110 651.426.7000 651.426.5004 fax www.hlbtr.com
Equal Opportunity Employer 100-Percent Employee-OJt ned
HLB Tautges Redpath,Ltd.is a member of HLB International,a world-wide network of independent accounting firms and business advisors.
estimates made by management, as well as evaluating the overall presentation of the financial
statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a
basis for our audit opinions.
Opinions
In our opinion, the financial statements referred to above present fairly, in all material respects,
the respective financial position of the governmental activities, the business-type activities, each
major fund, and the aggregate remaining fund information of the City of Fridley, Minnesota, as
of December 31, 2012, and the respective changes in financial position, and, where applicable,
cash flows thereof for the year then ended in accordance with accounting principles generally
accepted in the United States of America.
Report on Summarized Comparative Information
We have previously audited the City of Fridley, Minnesota's 2011 fmancial statements, and we
expressed an unmodified audit opinion on the respective financial statements of the
governmental activities, the business-type activities, each major fund, and the aggregate
remaining fund information in our report dated May 18, 2012. In our opinion,the summarized
comparative information presented herein as of and for the year ended December 31, 2011 is
consistent, in all material respects, with the audited financial statements from which they were
derived.
Other Matters - - -
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the
management's discussion and analysis and budgetary comparison information and the schedule
of funding progress listed in the table of contents on pages 21-30 and 86-89 be presented to
supplement the basic financial statements. Such information, although not a part of the basic
financial statements, is required by the Governmental Accounting Standards Board, who
considers it to be an essential part of financial reporting for placing the basic financial statements
in an appropriate operational, economic, or historical context. We have applied certain limited
procedures to the required supplementary information in accordance with auditing standards
generally accepted in the United States of America, which consisted of inquiries of management
about the methods of preparing the information and comparing the information for consistency
with management's responses to our inquiries, the basic financial statements, and other
knowledge we obtained during our audit of the basic financial statements. We do not express an
opinion or provide any assurance on the information because the limited procedures do not
provide us with sufficient evidence to express an opinion or provide any assurance.
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Other Information
Our audit was conducted for the purpose of forming opinions on the financial statements that
collectively comprise the City of Fridley, Minnesota's basic financial statements. The
introductory section, combining and individual fund financial statements, supplementary
financial information, statistical section, and other information section are presented for purposes
of additional analysis and are not a required part of the basic financial statements.
The combining and individual fund financial statements and the supplementary financial
information are the responsibility of management and were derived from and relate directly to
the underlying accounting and other records used to prepare the basic financial statements. Such
information has been subjected to the auditing procedures applied in the audit of the basic
financial statements and certain additional procedures, including comparing and reconciling such
information directly to the underlying accounting and other records used to prepare the basic
financial statements or to the basic financial statements themselves, and other additional
procedures in accordance with auditing standards generally accepted in the United States of
America. In our opinion, the combining and individual fund financial statements and the
supplementary financial information are fairly stated in all material respects in relation to the
basic financial statements as a whole.
The introductory, statistical, and other information sections have not been subjected to the
auditing procedures applied in the audit of the basic financial statements and, accordingly, we do
not express an opinion or provide any assurance on them.
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated June
14, 2013, on our consideration of the City of Fridley, Minnesota's internal control over financial
reporting and on our tests of its compliance with certain provisions of laws, regulations,
contracts, and grant agreements and other matters. The purpose of that report is to describe the
scope of our testing of internal control over financial reporting and compliance and the results of
that testing, and not to provide an opinion on internal control over financial reporting or on
compliance. That report is an integral part of an audit performed in accordance with
Government Auditing Standards in considering the City of Fridley, Minnesota's internal control
over financial reporting and compliance.
Ati /Rge6 7
HLB TAUTGES REDPATH, LTD.
June 14, 2013
19
CITY OF
FRIDLEY
20
MANAGEMENT'S DISCUSSION AND ANALYSIS
As management of the City of Fridley, we offer readers of the City of Fridley's financial
statements this narrative overview and analysis of the financial activities of the City for the
fiscal year ended December 31, 2012. We encourage readers to consider the information
presented here in conjunction with additional information that we have furnished in our letter
of transmittal, which can be found on pages 3 through 8 of this report.
Financial Highlights
The assets of the City of Fridley exceeded its liabilities at the close of the most recent fiscal
year by $63,470,334 (net position). Of this amount, $32,474,746 (unrestricted net position)
may be used to meet the government's ongoing obligations to citizens and creditors in
accordance with the City's fund designations and fiscal policies.
During 2012,the City's total net position increased by $772,278.
As of the close of the current fiscal year, the City of Fridley's governmental funds reported
combined ending fund balances of$24,777,091. Of this total amount, $3,114,112, or 13% is
restricted through legal restrictions or third-party agreements.
At the end of the current fiscal year the general fund balance of$7,669,322 included $66,152
in nonspendable and $7,582,360 in unassigned fund balance.
The City's total debt decreased by $325,713 during the current fiscal year, it went from
$15,941,706 to $15,615,993.
Overview of the Financial Statements
The discussion and analysis are intended to serve as an introduction to the City of Fridley's
basic financial statements. The City's basic financial statements comprise three components:
1) government-wide financial statements, 2) fund financial statements, and 3) notes to the
financial statements. This report also contains other supplementary information in addition
to the basic financial statements themselves.
Government-wide financial statements. The government-wide financial statements are
designed to provide readers with a broad overview of the City of Fridley's finances, in a
manner similar to a private-sector business.
The statement of net position presents information on all of the City of Fridley's assets and
liabilities, with the difference between the two reported as net position. Over time, increases
or decreases in net position may serve as a useful indicator of whether the financial position
of the City of Fridley is improving or deteriorating.
21
Management's Discussion and Analysis
The statement of activities presents information showing how the City's net position changed
during the most recent fiscal year. All changes in net position are reported as soon as the
underlying event giving rise to the change occurs, regardless of the timing of related cash
flows. Thus, revenues and expenses are reported in this statement for some items that will
only result in cash flows in future fiscal periods (e.g. uncollected taxes and earned but unused
vacation leave).
Both of the government-wide financial statements distinguish functions of the City of Fridley
that are principally supported by taxes and intergovernmental revenues (governmental
activities) from other functions that are intended to recover all or a significant portion of their
costs through user fees and charges (business-type activities). The governmental activities of
the City of Fridley include general government, public safety, public works, community
development, and recreation and naturalist. The business-type activities of the City of
Fridley include liquor, water, sewer and storm water.
The government-wide financial statements can be found on pages 33 through 35 of this
report.
Fund financial statements. A fund is a grouping of related accounts that is used to maintain
control over resources that have been segregated for specific activities or objectives. The
City of Fridley, like other state and local governments, uses fund accounting to ensure and
demonstrate compliance with finance-related legal requirements. All of the funds of the City
of Fridley can be divided into three categories: governmental funds, proprietary funds, and
fiduciary funds.
Governmental funds. Governmental funds are used to account for essentially the same
functions reported as governmental activities in the government-wide financial statements.
However, unlike the government-wide financial statements, governmental fund financial
statements focus on near-term inflows and outflows of spendable resources, as well as on
balances of spendable resources available at the end of the fiscal year. Such information may
be useful in evaluating a government's near-term financial requirements.
Because the focus of governmental funds is narrower than that of the government-wide
financial statements, it is useful to compare the information presented for governmental
funds with similar information presented for governmental activities in the government-wide
financial statement. By doing so, readers may better understand the long-term impact of the
City's near term financial decisions. Both the governmental fund balance sheet and
governmental fund statement of revenues, expenditures, and change in fund balances provide
a reconciliation to facilitate this comparison between governmental funds and governmental
activities.
22
Management's Discussion and Analysis
The City of Fridley maintains four individual major governmental funds. Information is
presented separately in the governmental fund balance sheet and in the governmental fund
statement of revenues, expenditures, and changes in fund balances for the general fund, debt
service fund, special assessment construction capital projects fund and capital improvements
fund all of which are considered to be major funds.
Data from the other governmental funds are combined into a single, aggregated presentation.
Individual fund data for each of these non-major governmental funds is provided in the form
of combining statements elsewhere in this report.
The City of Fridley adopts an annual appropriated budget for its general fund, special
revenue funds and capital improvements capital projects fund.
A budgetary comparison statement has been provided for those funds to demonstrate
compliance with this budget.
The basic governmental fund financial statements can be found on pages 36 through 41of this
report.
Proprietary funds. The City of Fridley maintains four enterprise funds and three internal
service funds as a part of its proprietary fund type. Enterprise funds are used to report the
same functions presented as business-type activities in the government-wide financial
statements. The City of Fridley uses enterprise funds to account for its liquor, water, sewer,
and storm water operations. The City of Fridley uses internal service funds to account for its
employee benefits, self insurance and information systems. Because these services
predominately benefit governmental rather than business-type functions, they have been
included within governmental activities in the government-wide financial statements.
Proprietary funds provide the same type of information as the government-wide financial
statements, only in more detail. The proprietary fund financial statements provide separate
information for the water, sewer, storm water and liquor operations, all of which are
considered to be major funds of the City of Fridley. Conversely, the internal service funds
are combined into a single, aggregated presentation in the proprietary fund financial
statements. Individual fund data for the internal service funds is provided in the form of
combining statements elsewhere in this report.
The basic proprietary fund financial statements can be found on pages 42 through 47of this
report.
Fiduciary funds. Fiduciary funds are used to account for resources held for the benefit of
parties outside the government. Fiduciary funds are not reflected in the government-wide
financial statements because the resources of those funds are not available to support the City
of Fridley's own program. The accounting used for fiduciary funds is much like that used for
proprietary funds.
The basic fiduciary fund financial statement can be found on page 48 of this report.
23
Management's Discussion and Analysis
Notes to the financial statements. The notes provide additional information that is essential
to a full understanding of the data provided in the government—wide and fund financial
statements. The notes to the financial statements can be found on pages 49 through 83 of this
report.
Other information. The combining statements referred to earlier in connection with the
non-major governmental funds are presented immediately following the required
supplementary information on budgetary comparisons. Combining and individual fund
statements and schedules can be found on pages 96 through 147 of this report.
Government-wide Financial Analysis
As noted earlier, net position may serve over time as a useful indicator of a government's
financial position. In the case of the City of Fridley, assets exceeded liabilities by
$63,470,334 at the close of the most recent fiscal year.
The largest portion of the City of Fridley's net position ($27,700,636 or 44 percent) reflects
its investment in capital assets (e.g. land, buildings, machinery and equipment) less any
related debt used to acquire those assets that is still outstanding. The City of Fridley uses
these capital assets to provide services to citizens; consequently, these assets are not available
for future spending. Although the City of Fridley's investment in its capital assets is reported
net of related debt, it should be noted that the resources needed to repay this debt must be
provided from other sources, since the capital assets themselves cannot be used to liquidate
these liabilities.
CITY OF FRIDLEY'S NET POSITION
GovemmentalActivities Business-Type Totals
2011 2012 2011 2012 2011 2012
Current and other as sets $28,999,522 $31,197,767 $10,438,978 $10,085,398 $39,438,500 $41,283,165
Capital as sets 21,874,639 20,938,802 19,755,832 19,474,122 41,630,471 40,412,924
Total assets $50,874,161 $52,136,569 $30,194,810 $29,559,520 $81,068,971 $81,696,089
Long-term liabilities outstanding $7,108,922 $7,410,130 $7,129,457 $6,477,952 $14,238,379 $13,888,082
Other liabilities 2,797,751 3,053,033 1,334,785 1,284,640 4,132,536 4,337,673
Total liabilities $9,906,673 $10,463,163 $8,464,242 $7,762,592 $18,370,915 $18,225,755
Net position:
Invested in capital assets,net of related debt $14,554,639 $14,139,656 $14,342,934 $13,560,980 $28,897,573 $27,700,636
Restricted 3,392,382 3,230,804 - - 3,392,382 3,230,804
Unrestricted 23,020,467 24,302,946 7,387,634 8,235,948 30,408,101 32,538,894
Total net position $40,967,488 $41,673,406 $21,730,568 $21,796,928 $62,698,056 $63,470,334
24
Management's Discussion and Analysis
The unrestricted net position in the respective proprietary funds are liquor $600,391, water
$3,491,591, sewer $2,856,863 and storm water $1,287,103. The liquor and water had
increases in net position of $1,574 and $163,118 respectively. The sewer and storm water
funds had decreases of$81,643 and$16,689 respectively.
Budgetary Highlights
General Fund
The original revenue and expenditure budgets were amended to account for $72,468 in
additional grants and donations received during the year.
Operating expenditures in total were less than the final budgetary estimates by $723,409.
Significant variances include unspent emergency funds of $120,000, Municipal Center,
Public Works and Parks department expended $214,649 less than anticipated in all areas.
The Police department expended $149,943 less than anticipated primarily due to vacancies in
the personal service budget and the Parks and Recreation department which expended
$81,700 less than anticipated.
Capital Asset and Debt Administration
Capital assets. The City of Fridley's, investment in capital assets for its governmental and
business type activities as of December 31, 2012, amounts to $40,412,924 (net of
accumulated depreciation). This investment in capital assets includes land, buildings and
structures, improvements other than buildings, machinery and equipment, infrastructure and
construction in progress.
City of Fridley's Capital Assets
(Net of Depreciation)
Governmental Activities Business-Type Activities Totals
2011 2012 2011 2012 2011 2012
Land $2,841,516 $2,841,516 $306,477 $306,477 $3,147,993 $3,147,993
Buildings and structures 1,755,938 1,463,784 1,558,316 1,471,805 3,314,254 2,935,589
Improvements other than buildings 1,785,230 1,785,957 7,065,003 6,786,822 8,850,233 8,572,779
Machinery and equipment 1,828,453 2,075,412 486,909 440,226 2,315,362 2,515,638
Infrastructure 13,657,502 12,772,133 10,339,127 10,462,397 23,996,629 23,234,530
Construction in progress 6,000 - - 6,395 6,000 6,395
Total Capital Assets $21,874,639 $20,938,802 $19,755,832 $1 9,474,122 $41,630,471 $40,412,924
Additional information on the City of Fridley's capital assets can be found in Note 4.
29
Management's Discussion and Analysis
A portion of the of the City of Fridley's net position represents resources that are subject to
external restrictions on how they may be used. The remaining balance of unrestricted net
position ($32,474,746) may be used to meet the City's ongoing obligations to citizens and
creditors.
At the end of the current fiscal year, the City of Fridley is able to report positive balances in
all three categories of net position, both for the government as a whole, as well as for its
separate governmental and business-type activities.
Governmental Activities
Governmental activities increased the City of Fridley's net position by $705,918. Capital
grants and contributions increased by $189,495 due to the increase in street construction
activity. There was a decrease in charges for services of$163,107 due to a one-time street
reconstruction project reimbursement in 2011. Public works expenditures increased by
$397,191 due to an increase in street construction activity.
City of Fridley's Changes in Net Position
Governmental Activities Business-Type Activities Totals
2011 2012 2011 2012 2011 2012
Revenues:
Program revenues:
Charges for services $3,957,600 $3,794,493 $12,014,399 $12,599,585 $15,971,999 $16,394,078
Operating grants and contributions 1,148,315 1,030,887 - - 1,148,315 1,030,887
Capital grants and contributions 1,374,651 1,564,146 - - 1,374,651 1,564,146
General revenues: -Property taxes 10,126,395 10,654,542 - - 10,126,395 10,654,542
Grants and contributions not
restricted to specific programs 1,095,470 1,030,123 - - 1,095,470 1,030,123
Unrestricted investment earnings 347,184 269,240 106,274 65,537 453,458 334,777
Gain(loss)on sale of property 14,937 56,598 - 9,680 14,937 66,278
Other - - - - - -
Total revenues 18,064,552 18,400,029 12,120,673 12,674,802 30,185,225 31,074,831
Expenses:
General government 3,321,402 3,155,983 - - 3,321,402 3,155,983
Public safety 6,720,641 6,999,554 - - 6,720,641 6,999,554
Public works 5,023,080 5,420,271 - - 5,023,080 5,420,271
Community development 973,198 880,414 - - 973,198 880,414
Recreation and naturalist 1,387,133 1,355,571 - - 1,387,133 1,355,571
Interest on long-term debt 263,075 232,318 - - 263,075 232,318
Liquor - - 4,568,282 4,354,909 4,568,282 4,354,909
Water - - 2,688,846 2,647,176 2,688,846 2,647,176
Sewer - - 4,750,467 4,653,434 4,750,467 4,653,434
Storm water - - 785,861 602,923 785,861 602,923
Total expenses 17,688,529 18,044,111 12,793,456 12,258,442 30,481,985 30,302,553
Increase(decrease)in net position before transfers 376,023 355,918 (672,783) 416,360 (296,760) 772,278
Transfers 350,000 350,000 (350,000) (350,000) - -
Increase in net position 726,023 705,918 (1,022,783) 66,360 (296,760) 772,278
Net position-January 1 40,241,465 40,967,488 22,753,351 21,730,568 62,994,816 62,698,056
Net position-December 31 $40,967,488 $41,673,406 $21,730,568_ $21,796,928 $62,698,056 $63470,334
25
Management's Discussion and Analysis
Below are specific graphs which provide comparisons of the governmental activities
revenues and expenses:
Governmental Activities-Revenues
Unrestricted investment
earnings
Grants and contributions not restricted to Charges for services Operating grants and
specific programs 1% 21% contributions
6% 6%
Capitgrants and
contributions
8%
58%
Property taxes
Governmental Activities-Expenses
Parks and Interest on
Community recreation long-term debt
developement o General government
5% 8% 1/0 18%
30%
Public works 38%
Public safety
26
Management's Discussion and Analysis
Business-Type Activities
Business-type activities increased net position by $66,360. Charges for utility services were
in-line with expenses for the utilities. There were decreases in both revenues and
expenditures for the liquor fund due to a major remodeling project affecting sales the latter
part of the year:
Business-Type Activities-Revenues
Unrestricted investment
earnings
ti
)9%
Charges for sery ices
Business-Type Activities-Expenses
Storm water
5%
Liquor
Water 35%
22%
N
38%
Sewer
27
Management's Discussion and Analysis
Financial Analysis of the Government's Funds
Governmental funds. The focus of the City of Fridley's governmental funds is to provide
information on near-term inflows, outflows, and balances of spendable resources. Such
information is useful in assessing the City of Fridley's financing requirements. In particular,
unrestricted fund balance may serve as a useful measure of a government's net resources
available for spending at the end of the fiscal year.
At the end of the current fiscal year, the City of Fridley's governmental funds reported
combined ending fund balances of$24,777,091.
The General Fund's fund balance increased by $895,767 in 2012. This was much better than
the $63,532 decrease originally budgeted for. The key reason for this increase was due to a
significant reduction in budgeted expenditures for both public works and public safety. 2012
proved to be a very mild year with very few snow plowing events. This saved both personnel
costs for overtime and supply costs for fuel and road salt. Public Safety expenditures saw
savings from personnel vacancies throughout the year.
The Capital Improvements Fund's assigned fund balance increased by $476,155 as a result of
recognizing approximately $760,000 of Local Government Aid (LGA) in this fund for the
first time. In prior years, LGA was budgeted in the General Fund. However, LGA has been
susceptible to state legislation that resulted in this becoming an unreliable source of revenue.
Rather than utilizing this revenue for operations within the General Fund, which requires
continual funding, the decision was made to allocate LGA to the Capital Improvements
Fund. Now if the City experiences fluctuations in LGA funding, we are more easily able to
adjust the budget for one-time purchases rather than continuous operational funding.
In 2012 the Capital Equipment Fund was added as a governmental fund, and ended the year
with a restricted fund balance of $860,854 and committed fund balance of $32,429. This
capital projects fund was added to better account for capital equipment purchases along with
the proceeds from capital equipment certificates. In the past, capital equipment was
purchased out of the General Fund and would tend to cause large peaks and valleys in
regards to total expenditures. With the capital equipment purchases reported in a separate
fund, the General Fund expenditures are more constant from year to year.
In addition, the City began issuing capital equipment certificates back in 2010. In 2012, the
City issued another round of equipment certificates for identified equipment purchases in
both 2012 and 2013. The restricted fund balance at December 31, 2012 represents unspent
equipment certificate proceeds.
Proprietary funds. The City of Fridley's proprietary funds provide the same type of
information found in the government-wide financial statements, but in more detail.
28
BASIC FINANCIAL STATEMENTS
31
CITY OF
FRIDLEY
32
Exhibit A-1
CITY OF FRIDLEY,MINNESOTA
STATEMENT OF NET POSITION
December 31,2012
With comparative totals for December 31,2011
Component Unit
Primary Government Housing&Redevelopment
Governmental Business-Type Totals Authority
Activities Activities 2012 2011 2012 2011
Assets:
Cash and investments $28,296,975 $5,650,648 $33,947,623 $30,821,058 $10,036,934 $9,018,618
Restricted cash and investments - 1,154,649 1,154,649 2,209,643 -
Receivables:
Accounts 183,578 2,441,794 2,625,372 2,497,345 72,020 46,687
Taxes 312,073 - 312,073 378,739 19,401 31,754
Special assessments 2,001,917 25,367 2,027,284 2,053,276 - -
Mortgage - - - - 1,051,661 1,061,200
Interest 171,657 - 171,657 162,150 71,390 44,656
Due from component unit 62,255 - 62,255 9,443 - -
Due from other governments 103,160 6,408 109,568 421,233 - -
Prepaid items - 298,009 298,009 279,839 3,914 4,399
Inventories-at cost 66,152 508,523 574,675 605,774 - -
' Land held for resale - - - - 3,378,555 3,599,305
Capital assets (net of accumulated depreciation):
Land 2,841,516 306,477 3,147,993 3,147,993 2,023,511 2,023,511
Buildings and structures 1,463,784 1,471,805 2,935,589 3,314,254 - -
Improvements other than buildings 1,785,957 6,786,822 8,572,779 8,850,233 - -
Machinery and equipment 2,075,412 440,226 2,515,638 2,315,362 - -
Infrastructure 12,772,133 10,462,397 23,234,530 23,996,629 - -
Construction in progress - 6,395 6,395 6,000 - -
Total assets 52,136,569 29,559,520 81,696,089 81,068,971 16,657,386 15,830,130
Liabilities:
Due to primary government - - - - 62,255 9,443
Accounts payable 237,263 335,886 573,149 667,539 375,985 496,928
Deposits payable 2,711 - 2,711 2,111 - -
Contracts payable 258,503 56,525 315,028 105,794 - -
Due to other governments 38,013 77,597 115,610 94,536 - -
Salaries payable 550,904 54,092 604,996 598,767 - -
Accrued interest payable 94,738 105,540 200,278 220,778 - -
Compensated absences payable:
Due within one year 763,779 - 763,779 767,935 - -
Due in more than one year 203,972 - 203,972 228,771 - -
Other post employment benefits payable:
Due in more than one year 526,158 65,161 591,319 562,074 - -
Unearned revenue 127,122 - 127,122 180,075 - -
Bonds payable:
Due within one year 980,000 655,000 1,635,000 1,494,744 - -
Due in more than one year 6,680,000 6,412,791 13,092,791 13,447,791 - -
Total liabilities 10,463,163 7,762,592 18,225,755 18,370,915 438,240 506,371
Net position:
Net investments in capital assets 14,139,656 13,560,980 27,700,636 28,897,573 2,023,511 2,023,511
Restricted for:
Debt service 3,067,040 - 3,067,040 3,335,579 - -
Tax increment purposes - - - - 2,042,108 1,611,468
Police forfeitures 127,928 127,928 71,491 - -
Cable television equipment 72,640 - 72,640 236,125 - -
Donations 27,344 - 27,344 - - -
Unrestricted 24,238,798 8,235,948 32,474,746 30,157,288 12,153,527 11,688,780
Total net position $41,673,406 $21,796,928 $63,470,334 $62,698,056 $16,219,146 $15,323,759
The accompanying notes are an integral part of these financial statements.
33
CITY OF FRIDLEY, MINNESOTA
STATEMENT OF ACTIVITIES
For The Year Ended December 31, 2012
With comparative totals for the year ended December 31, 2011
Program Revenues
Operating
Charges For Grants and
Expenses Services Contributions
Functions/Programs
Primary government:
Governmental activities:
General government $3,155,983 $1,979,737 $67,402
Public safety 6,999,554 862,584 505,020
Public works 5,420,271 28,144 347,539
Community development 880,414 554,129 77,932
Parks and recreation 1,355,571 369,899 32,994
Interest on long-term debt 232,318 - -
Total governmental activities 18,044,111 3,794,493 1,030,887
Business-type activities:
Liquor 4,354,909 4,705,523 -
Water 2,647,176 2,773,101 -
Sewer 4,653,434 4,549,254 -
Storm water 602,923 571,707 -
Total business-type activities 12,258,442 12,599,585 0
Total primary government $30,302,553 $16,394,078 $1,030,887
Component unit:
Housing and Redevelopment Authority $1,470,077 $9,600 $ -
Total component unit $1,470,077 $9,600 $0
General revenues:
Property taxes
Tax increment collections
Grants and contributions not
restricted to specific programs
Unrestricted investment earnings
Gain on sale of property
Other
Transfers
Total general revenues
and transfers
Change in net position
Net position -January 1
Net position - December 31
The accompanying notes are an integral part of these financial statements.
34
Exhibit A-2
Net (Expense) Revenue and Changes in Net Position Component Unit
Capital Primary Government Housing & Redevelopment
Grants and Governmental Business-Type Totals Authority
Contributions Activities Activities 2012 2011 2012 2011
$ - ($1,108,844) $ - ($1,108,844) ($1,368,378) $ - $ -
(5,631,950) - (5,631,950) (5,317,641) - -
1,564,146 (3,480,442) - (3,480,442) (2,934,994) - -
(248,353) - (248,353) (291,421) - -
- (952,678) - (952,678) (1,032,454) - -
(232,318) - (232,318) (263,075) - -
1,564,146 (11,654,585) 0 (11,654,585) (11,207,963) 0 0
- - 350,614 350,614 325,154 - -
- - 125,925 125,925 (270,620) - -
- - (104,180) (104,180) (504,813) - -
- - (31,216) (31,216) (328,778) - -
0 0 341,143 341,143 (779,057) 0 0
$1,564,146 (11,654,585) 341,143 (11,313,442) (11,987,020) $0 $0
$ - ($1,460,477) ($2,427,376)
$0 (1,460,477) (2,427,376)
10,654,542 - 10,654,542 10,126,395 422,275 448,347
- - 1,482,662 1,769,381
1,030,123 - 1,030,123 1,095,470 - 34,603
269,240 65,537 334,777 453,458 105,889 134,746
56,598 9,680 66,278 14,937 144,323 -
- - 200,715 409,046
350,000 (350,000) - - - -
12,360,503 (274,783) 12,085,720 11,690,260 2,355,864 2,796,123
705,918 66,360 772,278 (296,760) 895,387 368,747
40,967,488 21,730,568 62,698,056 62,994,816 15,323,759 14,955,012
$41,673,406 $21,796,928 $63,470,334 $62,698,056 $16,219,146 $15,323,759
The accompanying notes are an integral part of these financial statements.
35
CITY OF FRIDLEY,MINNESOTA
BALANCE SHEET
GOVERNMENTAL FUNDS
December 31,2012
General Debt Service
Assets
Cash and investments $7,740,442 $8,092,439
Receivables:
Accounts 90,413 -
Taxes 280,487 22,190
Special assessments 52,137 1,718,631
Interest 171,657 -
Due from other funds 97,712 -
Due from component unit 62,186 -
Due from other governments 14,978 -
Inventories,at cost 66,152 -
Total assets $8,576,164 $9,833,260
Liabilities and Fund Balances
Liabilities:
Accounts payable $175,055 $ -
Deposits payable 2,711 -
Contracts payable 5,392 -
Due to other governments 30,639 -
Due to other funds - -
Salaries payable 436,264 -
Deferred revenue 256,781 1,731,208
Total liabilities 906,842 1,731,208
Fund balance:
Nonspendable 66,152 -
Restricted 20,810 2,058,929
Committed - -
Assigned - 6,043,123
Unassigned 7,582,360 -
Total fund balance 7,669,322 8,102,052
Total liabilities and fund balance $8,576,164 $9,833,260
The accompanying notes are an integral part of these financial statements.
36
Exhibit A-3
■
Special Assessment Other
Construction Capital Capital Governmental Intra-Activity
Projects Improvements Funds Eliminations Totals Governmental Funds
2012 2011
$998,859 $5,698,273 $2,687,928 $ - $25,217,941 $22,461,929
- - 93,165 - 183,578 199,984
47 203 9,146 - 312,073 378,739
29,796 201,353 - - 2,001,917 2,044,341
- - - - 171,657 162,150
- - - (97,712) - -
- - - - 62,186 9,351
- 70,811 17,371 - 103,160 416,492
- - - - 66,152 65,271
$1,028,702 $5,970,640 $2,807,610 ($97,712) $28,118,664 $25,738,257
$3,655 $13,554 $41,809 $ - $234,073 $226,245
- - - - 2,711 2,111
105,804 15,641 131,666 - 258,503 1,083
7,227 - 147 - 38,013 20,637
- - 97,712 (97,712) - -
- - 19,425 - 455,689 442,762
29,796 200,972 133,827 - 2,352,584 2,523,085
146,482 230,167 424,586 (97,712) 3,341,573 3,215,923
- - - - 66,152 65,271
- - 1,034,373 - 3,114,112 2,529,873
882,220 - 1,446,363 - 2,328,583 2,209,067
- 5,740,473 - - 11,783,596 11,108,003
- - (97,712) - 7,484,648 6,610,120
882,220 5,740,473 2,383,024 0 24,777,091 22,522,334
$1,028,702 $5,970,640 $2,807,610 ($97,712) $28,118,664 $25,738,257
Fund balance reported above $24,777,091 $22,522,334
Amounts reported for governmental activities in the statement of net position are different because:
Capital assets used in governmental activities are not financial resources and,
therefore, are not reported in the funds. 20,587,570 21,583,868
Other long-term assets are not available to pay for current-period expenditures and,
therefore, are deferred in the funds. 2,225,462 2,343,010
Long-term liabilities, including bonds payable,are not due and payable in the
current period and,therefore,are not reported in the funds. (8,280,896) (7,927,874)
Internal service funds are used by management to charge the cost of certain activities to individual
funds. The assets and liabilities are included in the governmental statement of net position. 2,364,179 2,446,150
Net position of governmental activities $41,673,406 $40,967,488
The accompanying notes are an integral part of these financial statements.
37
CITY OF FRIDLEY, MINNESOTA
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
GOVERNMENTAL FUNDS
For The Year Ended December 31, 2012
With comparative totals for the year ended December 31, 2011
General Debt Service
Revenues:
Taxes $9,641,494 $772,391
Special assessments 39,851 659,666
Licenses and permits 851,976 -
Intergovernmental revenue 874,778 -
Charges for services 1,972,076 -
Fines and forfeits 170,427 -
Investment income 81,239 76,625
Miscellaneous:
Other 271,388 -
Received from component unit - -
Total revenues 13,903,229 1,508,682
Expenditures:
Current:
General government 2,605,084 -
Public safety 6,398,467 -
Public works 3,009,937 -
Community development 772,070 -
Parks and recreation 797,741 -
Debt service - 1,185,753
Capital outlay 24,163 -
Total expenditures 13,607,462 1,185,753
Excess (deficiency) of revenues
over(under) expenditures 295,767 322,929
Other financing sources (uses):
Bonds issued - -
Bond premiums - -
Proceeds from sale of capital assets - -
Transfers in 600,000 -
Transfers out - (286,819)
Total other financing sources (uses) 600,000 (286,819)
Net change in fund balance 895,767 36,110
Fund balance -January 1 6,773,555 8,065,942
Fund balance- December 31 $7,669,322 $8,102,052
The accompanying notes are an integral part of these financial statements.
38
Exhibit A-4
Special
Assessment Other
Construction Capital Governmental Intra-Activity
Capital Projects Improvements Funds Eliminations Totals Governmental Funds
2012 2011
$ - $76 $318,168 $ - $10,732,129 $10,113,120
12,515 51,888 - - 763,920 672,929
- - 252,528 - 1,104,504 1,085,100
- 1,599,601 174,828 - 2,649,207 2,499,010
19,333 - 362,479 - 2,353,888 2,560,925
- - 85,195 - 255,622 258,372
968 59,295 18,099 - 236,226 297,290
- 750 50,216 - 322,354 325,284
32,816 1,711,610 1,261,513 0 18,417,850 17,812,030
197,059 49,364 647,690 - 3,499,197 3,165,111
- - 28,308 - 6,426,775 6,284,658
37,363 - - - 3,047,300 3,061,100
- - - 772,070 979,042
- 35,830 418,518 - 1,252,089 1,195,410
- 33,581 - 1,219,334 1,074,768
727,248 280,261 _ 608,101 - 1,639,773 964,410
961,670 365,455 1,736,198 0 17,856,538 16,724,499
(928,854) 1,346,155 (474,685) 0 561,312 1,087,531
- - 1,280,000 - 1,280,000 -
- - 63,445 - 63,445 15,096
870,000 - 36,819 (1,156,819) 350,000 380,000
- (870,000) _ - 1,156,819 - -
870,000 (870,000) 1,380,264 0 1,693,445 395,096
(58,854) 476,155 905,579 0 2,254,757 1,482,627
941,074 5,264,318 1,477,445 - 22,522,334 21,039,707
$882,220 $5,740,473 $2,383,024 $0 $24,777,091 $22,522,334
-
The accompanying notes are an integral part of these financial statements.
39
iii
CITY OF
FRIDLEY
40
Exhibit A-5
CITY OF FRIDLEY, MINNESOTA
RECONCILIATION OF THE STATEMENT OF REVENUES,
EXPENDITURES AND CHANGES IN FUND BALANCES OF
GOVERNMENTAL FUNDS
TO THE STATEMENT OF ACTIVITIES
For The Year Ended December 31, 2012
With comparative amounts for the year ended December 31, 2011
2012 2011
Amounts reported for governmental activities in the
statement of activities (Exhibit A-2) are different because:
Net changes in fund balances-total governmental funds (Exhibit A-4) $2,254,757 $1,482,627
Governmental funds report capital outlays as expenditures. However,
in the statement of activities the cost of those assets is allocated
over their estimated useful lives and reported as depreciation
expense. This is the amount by which capital outlays exceeded
depreciation in the current period. (996,298) (1,514,711)
Revenues in the statement of activities that do not provide current
financial resources are not reported as revenues in the funds. (117,548) 166,234
The issuance of long-term debt(e.g., bonds, leases) provides current
resources to governmental funds, while the repayment of the
principal of financial long-term debt consumes the current
financial resources of governmental funds. Neither transaction,
however, has any effect on net position. This amount is the net
effect of these differences in the treatment of long-term debt and
related items. (340,000) 800,000
Internal service funds are used by management to charge the cost of
certain activities to individual funds. This amount is net revenue
attributable to governmental activities. (81,971) (191,650)
Other post employment benefits in the statement of activities does not
require the use of current financial resources and, therefore, is not
reported as expenditures in governmental funds. (26,007) (27,720)
Accrued interest reported in the statement of activities does not require
the use of current financial resources and, therefore, is not
reported as expenditures in governmental funds. 12,985 11,243
Change in net position of governmental activities (Exhibit A-2) $705,918 $726,023
The accompanying notes are an integral part of these financial statements.
41
CITY OF FRIDLEY, MINNESOTA
STATEMENT OF NET POSITION
PROPRIETARY FUNDS
December 31, 2012
With comparative totals for December 31, 2011
Business-Type Activities- Enterprise Funds
Assets: Liquor Water
Current assets:
Cash and investments $501,583 $2,647,683
Restricted cash and investments - 952,796
Accounts receivable - 1,025,923
Special assessments receivable - 8,403
Due from other governments - -
Prepaid items - -
Inventories-at cost 450,066 58,457
Total current assets 951,649 4,693,262
Noncurrent assets:
Capital assets:
Land 151,946 154,531
Buildings and structures 130,211 3,124,015
Improvements other than buildings 658,500 8,934,668
Machinery and equipment 179,184 1,635,362
Infrastructure - 9,809,768
Construction in process 6,395 -
Total capital assets 1,126,236 23,658,344
Less: Allowance for depreciation (776,197) (12,850,373)
Net capital assets 350,039 10,807,971
Total noncurrent assets 350,039 10,807,971
Total assets 1,301,688 15,501,233
Liabilities:
Current liabilities:
Accounts payable 273,306 55,881
Accrued interest payable - 93,868
Contracts payable - 23,650
Due to other governments 42,906 27,004
Salaries payable 17,186 21,117
Payroll deductions payable - -
Compensated absences payable - -
Bonds payable-current - 570,000
Total current liabilities 333,398 791,520
Noncurrent liabilities:
Other post employment benefits 17,860 27,355
Compensated absences- noncurrent - -
Bonds payable- noncurrent - 5,587,791
Total noncurrent liabilities 17,860 5,615,146
Total liabilities 351,258 6,406,666
Net position:
Net investment in capital assets 350,039 5,602,976
Unrestricted 600,391 3,491,591
Total net position $950,430 $9,094,567
The accompanying notes are an integral part of these financial statements.
42
Exhibit A-6
Governmental
Activities-
Internal Service
Business-Type Activities- Enterprise Funds Totals Funds
Sewer Storm Water 2012 2011
$1,170,698 $1,330,684 $5,650,648 $5,097,956 $3,079,034
201,853 - 1,154,649 2,209,643 -
1,263,765 152,106 2,441,794 2,297,361 -
- 16,964 25,367 8,935 69
4,546 1,862 6,408 4,741 -
298,009 - 298,009 279,839 -
- _ - 508,523 540,503 -
2,938,871 1,501,616 10,085,398 10,438,978 3,079,103
- - 306,477 306,477 -
8,770 - 3,262,996 3,262,996 -
2,878,017 2,066,534 14,537,719 14,240,341 -
955,342 172,215 2,942,103 3,004,752 1,462,918
7,004,703 7,185,729 24,000,200 23,330,480 -
- - 6,395 - -
10,846,832 9,424,478 45,055,890 44,145,046 1,462,918
(6,740,339) _ (5,214,859) (25,581,768) (24,389,214) (1,111,685)
4,106,493 4,209,619 19,474,122 19,755,832 351,233
4,106,493 _ 4,209,619 19,474,122 19,755,832 351,233
7,045,364 5,711,235 29,559,520 30,194,810 3,430,336
6,203 496 335,886 433,018 3,191
6,667 5,005 105,540 113,055 -
25,716 7,159 56,525 104,711 -
7,687 - 77,597 73,889 -
15,789 - 54,092 55,111 -
- - - 95,215
- - - - 763,779
50,000 _ 35,000 655,000 554,744 -
112,062 47,660 1,284,640 1,334,528 862,185
19,946 - 65,161 61,923 -
- - - - 203,972
470,000 _ 355,000 6,412,791 7,067,791 -
489,946 355,000 6,477,952 7,129,714 203,972
602,008 402,660 7,762,592 8,464,242 1,066,157
3,586,493 4,021,472 13,560,980 14,342,934 351,233
2,856,863 _ 1,287,103 8,235,948 7,387,634 2,012,946
$6,443,356 $5,308,575 $21,796,928 $21,730,568 $2,364,179
The accompanying notes are an integral part of these financial statements.
43
CITY OF FRIDLEY, MINNESOTA
STATEMENT OF REVENUES, EXPENSES AND
CHANGES IN FUND NET POSITION
PROPRIETARY FUNDS
For The Year Ended December 31, 2012
With comparative totals for the year ended December 31, 2011
Business-Type Activities- Enterprise Funds
Liquor Water
Sales $4,705,523 $ -
Cost of sales (3,497,168) -
Gross profit 1,208,355 0
Operating revenues:
Customer billings - 2,762,859 _
Charges for services - -
Other revenues - 10,242
Total operating revenues 0 2,773,101
Total gross profit and operating revenues 1,208,355 2,773,101
Operating expenses:
Personal services 506,256 826,616
Supplies and other charges:
Disposal charges - -
Other 322,048 829,425
Depreciation 29,437 764,093
Total operating expenses 857,741 2,420,134
Operating income (loss) 350,614 352,967
Nonoperating revenues (expenses):
Intergovernmental revenue - -
Investment income 960 35,933
Insurance reimbursement - -
Interest expense - (227,042)
Other - -
Gain (loss) on disposal of capital assets - 1,260
Total nonoperating revenues (expenses) 960 (189,849)
Income (loss) before transfers 351,574 163,118
Transfers:
Transfers out (350,000) -
Change in net position 1,574 163,118
Net position -January 1 948,856 8,931,449
Net position - December 31 $950,430 $9,094,567
The accompanying notes are an integral part of these financial statements.
44
Exhibit A-7
Governmental
Business-Type Activities- Enterprise Funds Activities-
Internal Service
Sewer Storm Water Totals Funds
2012 2011
$ - $ - $4,705,523 $4,893,241 $ -
- - (3,497,168) (3,681,988) -
0 0 1,208,355 1,211,253 0
4,548,904 552,643 7,864,406 7,118,154 -
350 1,862 2,212 334 291,859
- - _ 10,242 2,378 -
4,549,254 554,505 7,876,860 7,120,866 291,859
4,549,254 554,505 9,085,215 8,332,119 291,859
695,883 240,400 2,269,155 2,238,507 49,410
3,374,867 - 3,374,867 3,440,691 -
262,130 112,223 1,525,826 1,853,668 231,876
304,554 238,287 1,336,371 1,306,339 136,123
4,637,434 590,910 8,506,219 8,839,205 417,409
(88,180) (36,405) 578,996 (507,086) (125,550)
- - - - 10,365
14,117 14,527 65,537 106,274 33,014
- 700 700 - 200
(16,000) (12,013) (255,055) (272,263) -
16,502 16,502 292 -
8,420 - 9,680 - -
6,537 19,716 (162,636) (165,697) 43,579
(81,643) (16,689) 416,360 (672,783) (81,971)
- - (350,000) (350,000) -
(81,643) (16,689) 66,360 (1,022,783) (81,971)
6,524,999 5,325,264 21,730,568 22,753,351 2,446,150
$6,443,356 $5,308,575 $21,796,928 $21,730,568 $2,364,179
The accompanying notes are an integral part of these financial statements.
45
CITY OF FRIDLEY, MINNESOTA
STATEMENT OF CASH FLOWS
PROPRIETARY FUNDS
For The Year Ended December 31, 2012
With comparative totals for the year ended December 31, 2011
Business-Type Activities-Enterprise Funds
Liquor Water
Cash flows from operating activities:
Receipts from customers and users $4,705,523 $2,743,633
Receipts from interfund services provided
Payment to suppliers (3,826,202) (951,249)
Payment to employees (505,956) (825,188)
Net cash flows from operating activities 373,365 967,196
Cash flows from noncapital financing activities:
Transfers out (350,000) -
Net cash flows from
noncapital financing activities (350,000) 0
Cash flows from capital and related
financing activities:
Acquisition of capital assets (14,651) (646,707)
Intergovernmental - -
Insurance reimbursement - -
Principal paid on revenue bonds - (554,744)
Proceeds from sale of bonds - -
Interest and paying agent fees on revenue bonds - (234,557)
Proceeds from sale of capital assets - 1,260
Net cash flows from capital
and related financing activities (14,651) (1,434,748)
Cash flows from investing activities:
Investment income 960 35,933
Net increase(decrease) in cash and cash equivalents 9,674 (431,619)
Cash and cash equivalents-January 1 491,909 4,032,098
Cash and cash equivalents-December 31 $501,583 $3,600,479
Reconciliation of operating income(loss)to net cash
provided (used) by operating activities:
Operating income (loss) $350,614 $352,967
Adjustments to reconcile operating income (loss)
to net cash flows from operating activities:
Depreciation 29,437 764,093
Changes in assets and liabilities:
Decrease (increase) in receivables - (29,468)
Decrease (increase) in prepaid items - -
Decrease (increase) in inventories 72,462 (40,481)
Increase(decrease) in payables (79,148) (79,915)
Total adjustments 22,751 614,229
Net cash provided by operating activities $373,365 $967,196
The accompanying notes are an integral part of these financial statements.
46
Exhibit A-8
Governmental
Business-Type Activities-Enterprise Funds Activities-
Internal Service
Sewer Storm Water _ Totals Funds
2012 2011
$4,455,049 $515,646 $12,419,851 $11,954,242
- - 291,882
(3,641,511) (106,698) (8,525,660) (8,823,613) (236,971)
(695,392) (240,400) (2,266,936) (2,236,597) (84,044)
118,146 168,548 1,627,255 894,032 (29,133)
- - (350,000) (350,000) -
0 0 (350,000) (350,000) 0
(262,394) (130,910) (1,054,662) (957,951) (196,585)
16,502 16,502 292 10,365
-
700 700 - 200
- - (554,744) (535,000) -
(16,000) (12,013) (262,570) (280,062) -
8,420 - 9,680 - -
(269,974) (125,721) (1,845,094) (1,772,721) (186,020)
14,117 14,527 65,537 106,274 33,014
(137,711) 57,354 (502,302) (1,122,415) (182,139)
1,510,262 1,273,330 7,307,599 8,430,014 3,261,173
$1,372,551 $1,330,684 $6,805,297 $7,307,599 $3,079,034
($88,180) ($36,405) $578,996 ($507,086) ($125,550)
304,554 238,287 1,336,371 1,306,339 136,123
(94,205) (38,859) (162,532) (59,865) 23
(18,170) - (18,170) 5,264 -
- 31,981 12,603 -
14,147 5,525 (139,391) 136,777 (39,729)
■ 206,326 204,953 1,048,259 1,401,118 96,417
$118,146 $168,548 $1,627,255 $894,032 ($29,133)
The accompanying notes are an integral part of these financial statements.
47
Exhibit A-9
CITY OF FRIDLEY, MINNESOTA
STATEMENT OF FIDUCIARY NET POSITION
December 31,2012
With comparative amounts for December 31, 2011
2012 2011
Assets:
Cash and investments $24,631 $21,934
Receivables:
Accounts 2,766 2,572
Taxes:
Unremitted - 46
Delinquent 61 208
Total assets $27,458 $24,760
Liabilities:
Due to other governments $27,458 $24,760
The accompanying notes are an integral part of these financial statements.
48
CITY OF FRIDLEY, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2012
1. Summary of Significant Accounting Policies
The City of Fridley, Minnesota was incorporated July 1, 1949, under Chapter 410.03 of the Statutes of the
State of Minnesota providing for a council-manager form of government under the "Home Rule Charter
City" concept. The City provides the following services as authorized by its charter: general
administrative services, public safety (police and fire), public improvements, planning and zoning, and
culture and recreation.
The financial statements of the City of Fridley, Minnesota have been prepared in conformity with
generally accepted accounting principles as applied to governmental units by the Governmental
Accounting Standards Board (GASB). The following is a summary of the significant accounting policies.
A. Financial Reporting Entity
As required by generally accepted accounting principles, the financial statements of the
reporting entity include those of the City of Fridley, Minnesota (the primary government) and its
component units. The component units discussed below are included in the City's reporting
entity because of the significance of their operational or financial relationships with the City.
Component Units
In conformity with generally accepted accounting principles, the financial statements of the
component units have been included in the financial reporting entity as discretely presented
component units.
Discretely Presented Component Unit - The Fridley Housing and Redevelopment Authority,
(HRA) is governed by commissioners appointed by the Fridley City Council. The HRA is
responsible for providing housing and redevelopment assistance to the City and its residents.
Funding for the various programs administered by the HRA is provided through the issuance of
tax increment revenue bonds and general obligation tax increment bonds guaranteed by the
City. Separate financial statements are not prepared for the HRA.
B. Government-Wide and Fund Financial Statements
The government-wide financial statements (i.e., the statement of net position and the statement
of changes in net position) report information on all of the nonfiduciary activities of the primary
government and its component units. For the most part, the effect of interfund activity has been
removed from these statements. Governmental activities, which normally are supported by taxes
and intergovernmental revenues, are reported separately from business-type activities, which rely
to a significant extent on fees and charges for support.
The statement of activities demonstrates the degree to which the direct expenses of a given
function or business-type activity is offset by program revenues. Direct expenses are those that
are clearly identifiable with a specific function or business-type activity. Program revenues
include 1) charges to customers or applicants who purchase, use, or directly benefit from goods,
services, or privileges provided by a given function or business-type activity and 2) grants and
contributions that are restricted to meeting the operational or capital requirements of a particular
function or business-type activity. Taxes and other items not included among program revenues
are reported instead as general revenues.
49
CITY OF FRIDLEY, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2012
Separate financial statements are provided for governmental funds, proprietary funds, and
fiduciary funds, even though the latter are excluded from the government-wide financial
statements. Major individual governmental funds and major individual enterprise funds are
reported as separate columns in the fund financial statements.
C. Measurement Focus, Basis of Accounting, and Financial Statement Presentation
The government-wide financial statements are reported using the economic resources
measurement focus and the accrual basis of accounting, as are the proprietary fund financial
statements. Revenues are recorded when earned and expenses are recorded when a liability is
incurred, regardless of the timing of related cash flows. Property taxes are recognized as
revenues in the year for which they are levied. Grants and similar items are recognized as
revenue as soon as all eligibility requirements imposed by the provider have been met.
Governmental fund financial statements are reported using the current financial resources
measurement focus and the modified accrual basis of accounting. Revenues are recognized as
soon as they are both measurable and available. Revenues are considered to be available when
they are collectible within the current period or soon enough thereafter to pay liabilities of the
current period. For this purpose, the government considers all revenues, except reimbursement
grants, to be available if they are collected within 60 days of the end of the current fiscal period.
Reimbursement grants are considered available if they are collected within one year of the end of
the current fiscal period. Expenditures generally are recorded when a liability is incurred, as
under accrual accounting. However, debt service expenditures, as well as expenditures related
to compensated absences and claims and judgments, are recorded only when payment is due.
Property taxes, special assessments, intergovernmental revenues, charges for services and
interest associated with the current fiscal period are all considered to be susceptible to accrual
and so have been recognized as revenues of the current fiscal period. Only the portion of special
assessments receivable due within the current fiscal period is considered to be susceptible to
accrual as revenue of the current period. All other revenue items are considered to be
measurable and available only when cash is received by the government.
The government reports the following major governmental funds:
The General Fund is the government's primary operating fund. It accounts for all financial
resources of the general government, except those required to be accounted for in another
fund.
The Debt Service Fund services debt on the general obligation improvement bonds that were
issued to finance construction of public improvements. Special assessment improvements
are paid for completely or in part by property owners deemed to have benefited from such
improvements.
The Special Assessment Construction Capital Projects Fund is used to account for the
construction of public improvements, such as residential streets, sidewalks, and storm
sewers or for the provision of services that are to be paid primarily by the benefited property
owner.
50
CITY OF FRIDLEY, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2012
The capital improvements fund is used to account for the monies received from property
taxes that are used to finance major improvements and the acquisition of assets that require
a large capital outlay.
The government reports the following major proprietary funds:
The Liquor Fund accounts for operations of the municipal liquor stores.
The Water Fund accounts for the water service charges which are used to finance the water
system operating expenses.
The Sewer Fund accounts for the sewer service charges which are used to finance the
sanitary sewer system operating expenses.
The Storm Water Fund accounts for storm sewer charges which are used to finance the
storm sewer operating expenses.
Additionally, the government reports the following fund types:
Internal Service Funds are used to account for employee fringe benefits, insurance
deductibles and maintenance and upgrading of information systems that are provided on a
cost reimbursement or fee basis to departments or agencies within the City. These funds
are essential for segregating costs for determining the total cost of providing a service and
for assuring that the goods and services provided are properly utilized.
Agency Funds are used to account for monies on behalf of the Six Cities Watershed District
and the North Metro Convention and Tourism Bureau.
As a general rule the effect of interfund activity has been eliminated from the government-wide
financial statements. Exceptions to this general rule are transactions that would be treated as
revenues, expenditures or expenses if they involved external organizations, such as buying
goods and services or payments in lieu of taxes, are similarly treated when they involve other
funds of the City of Fridley. Elimination of these charges would distort the direct costs and
program revenues reported for the various functions concerned.
Amounts reported as program revenues include 1) charges to customers or applicants for goods,
services, or privileges provided, 2) operating grants and contributions, and 3) capital grants and
contributions, including special assessments. Internally dedicated resources are reported as
general revenues rather than as program revenues. Likewise, general revenues include all
taxes.
Proprietary funds distinguish operating revenues and expenses from nonoperating items.
Operating revenues and expenses generally result from providing services and producing and
delivering goods in connection with a proprietary fund's principal ongoing operations. The
principal operating revenues of the liquor, water, sewer and storm water enterprise funds are
charges to customers for sales and services. Operating expenses for enterprise funds include
the cost of sales and services, administrative expenses, and depreciation on capital assets. All
revenues and expenses not meeting this definition are reported as nonoperating revenues and
expenses.
51
CITY OF FRIDLEY, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2012
When both restricted and unrestricted resources are available for an allowable use, it is the
government's policy to use restricted resources first, then unrestricted resources as they are
needed.
D. Budgets
The City Charter grants the City Council full authority over the financial affairs of the City. The
City Manager is charged with the responsibility of preparing the estimates of the annual budget
and the enforcement of the provisions of the budget as specified in the City Charter. Upon
adoption of the annual budget resolution by the Council, it becomes the formal appropriation
budget for City operations. All budget adjustments must be approved by the Council. Budgets
for the General, Special Revenue and Capital Improvement Capital Projects Funds are adopted
on a basis consistent with accounting principles generally accepted in the United States of
America. Budgeted expenditure appropriations lapse at year end.
Encumbrance accounting, under which purchase orders, contracts, and other commitments for
the expenditure of monies are recorded in order to reserve that portion of the appropriation, is
not employed by the City because it is, at present, not considered necessary to assure effective
budgetary control or to facilitate effective cash management.
E. Legal Compliance Budgets
The City follows these procedures in establishing the budgetary data reflected in the financial
statements:
1. The City Manager submits to the City Council a proposed operating budget for the fiscal
year commencing the following January 1. The operating budget includes expenditures
and the means of financing them.
2. Public hearings are conducted to obtain taxpayer comments.
3. The budget is legally enacted through passage of a resolution.
4. The City Council may authorize transfer of budgeted amounts between departments within
any fund.
5. Reported budget amounts are as originally adopted or as amended by Council approved
transfers. The City Charter limits appropriations to the total estimated revenues and fund
balances. If actual revenues exceed the original estimates, appropriations may be
increased by the Council up to the amount of revenue increases.
6. All budget amounts lapse at the end of the year to the extent they have not been expended
or encumbered. Encumbrances are reappropriated into the following year's budget.
7. Annual budgets are legally adopted for the General Fund and Special Revenue Funds.
Formal budgeting integration is employed as a management control device during the year
for each of these funds. Formal budgetary integration is not employed for Debt Service
Funds because effective budgetary control is achieved through the bond indenture
provisions. Budgetary control for other Capital Projects Funds is accomplished through the
use of project controls.
52
CITY OF FRIDLEY, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2012
8. As required by the City Charter, budgetary control is maintained within department at the
level of three major categories of expenditures: salaries and wages; ordinary expenses;
and capital outlay. This is the level of control at which expenditures may not legally exceed
appropriations.
9. The General Fund budget includes prior year encumbrances which were reappropriated to
the current year. Expenditures for the items encumbered are included in the current year's
expenditures.
F. Cash and Investments
Cash balances from all funds are combined and invested to the extent available in certificates of
deposit, U.S. government securities and other securities authorized by State Statute. Investment
income is allocated to the respective funds on the basis of applicable cash balance participation
by each fund. Investments are stated at fair value, based upon quoted market prices as of the
balance sheet date. Investment income is accrued at the balance sheet date.
The City provides temporary advances to funds that have insufficient cash balances by means of
an advance from another fund shown as interfund receivables in the advancing fund, and an
interfund payable in the fund with the deficit, until adequate resources are received. These
interfund balances are eliminated on the government-wide financial statements.
For purposes of the statement of cash flows the City considers all highly liquid investments with a
maturity of three months or less when purchased to be cash equivalents. All of the cash and
investments allocated to the proprietary funds have original maturities of 90 days or less.
Therefore the entire balance in the Proprietary Funds is considered cash equivalents.
Restricted cash balances relate to unspent bond proceeds.
Investments are stated at fair value, based upon quoted market prices, except for investments in
2a7-like external investment pools, which are stated at amortized cost. Investment income is
accrued at the balance sheet date.
G. Receivables and Payables
During the course of operations, numerous transactions occur between individual funds for goods
provided or services rendered. Short-term interfund loans are classified as "interfund
receivables/payables." All short-term interfund receivables and payables at December 31, 2012
are planned to be eliminated in 2012. Any residual balances outstanding between the
governmental activities and business-type activities are reported in the government-wide financial
statements as"internal balances."
Uncollectible property taxes and special assessments are not material and therefore have not
been reported. Because utility bills are considered liens on property, no estimated uncollectible
amounts are established. Uncollectible amounts are not material for other receivables and have
not been reported.
53
CITY OF FRIDLEY, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2012
H. Property Tax Revenue Recognition
The City Council annually adopts a tax levy and certifies it to the County in December
(levy/assessment date) of each year for collection in the following year. The County is
responsible for billing and collecting all property taxes for itself, the City, the local School District
and other taxing authorities. Such taxes become a lien on January 1 and are recorded as
receivables by the City at that date. Real property taxes are payable (by property owners) on
May 15 and October 15 of each calendar year. Personal property taxes are payable by
taxpayers on February 28 and June 30 of each year. These taxes are collected by the County
and remitted to the City on or before July 7 and December 2 of the same year. Delinquent
collections for November and December are received the following January. The City has no
ability to enforce payment of property taxes by property owners. The County possesses this
authority.
Government-Wide Financial Statements
The City recognizes property tax revenue in the period for which the taxes were levied.
Uncollectible property taxes are not material and have not been reported.
Governmental Fund Financial Statements
The City recognizes property tax revenue when it becomes both measurable and available to
finance expenditures of the current period. In practice, current and delinquent taxes and State
credits received by the City in July, December and January are recognized as revenue for the
current year. Taxes collected by the County by December 31 (remitted to the City the following
January) and taxes and credits not received at year end are classified as delinquent and due
from County taxes receivable. The portion of delinquent taxes not collected by the City in
January is fully offset by deferred revenue because they are not available to finance current
expenditures.
Special Assessment Revenue Recognition
Special assessments are levied against the benefited properties for the assessable costs of
special assessment improvement projects in accordance with State Statutes. The City usually
adopts the assessment rolls when the individual projects are complete or substantially complete.
The assessments are collectible over a term of years generally consistent with the term of years
of the related bond issue. Collection of annual installments is handled by the County in the same
manner as property taxes. Property owners are allowed to prepay future installments without
interest or prepayment penalties.
54
CITY OF FRIDLEY, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2012
Once a special assessment roll is adopted, the amount attributed to each parcel is a lien upon
that property until full payment is made or the amount is determined to be excessive by the City
Council or court action. If special assessments are allowed to go delinquent, the property is
subject to tax forfeit sale. Proceeds of sales from tax forfeit properties are remitted to the City in
payment of delinquent special assessments. Pursuant to State Statutes, a property shall be
subject to a tax forfeit sale after three years unless it is homesteaded, agricultural or seasonal
recreational land in which event the property is subject to such sale after five years.
Government-Wide Financial Statements
The City recognizes special assessment revenue in the period that the assessment roll was
adopted by the City Council. Uncollectible special assessments are not material and have not
been reported.
Governmental Fund Financial Statements
Revenue from special assessments is recognized by the City when it becomes measurable and
available to finance expenditures of the current fiscal period. In practice, current and delinquent
special assessments received by the City are recognized as revenue for the current year.
Special assessments that are collected by the County by December 31 (remitted to the City the
following January) are also recognized as revenue for the current year. All remaining delinquent,
deferred and special deferred assessments receivable in governmental funds are completely
offset by deferred revenues.
J. Inventories
Governmental Funds
Inventories of the general fund are stated at cost, which approximates market, using the first-in,
first out (FIFO) method. The primary government does not maintain material amounts of
inventory within the other governmental funds. Inventories of governmental funds are recorded
as expenditures when consumed rather than when purchased.
Proprietary Funds
Liquor fund inventories are valued on the average cost basis. Other proprietary funds inventory
items are expensed at the time they are sold or used (consumption method).
K. Prepaid Items
Certain payments to vendors reflect costs applicable to future accounting periods and are
recorded as prepaid items in both government-wide and fund financial statements. Prepaid items
are reported using the consumption method and recorded as expenditures/expenses at the time
of consumption.
55
CITY OF FRIDLEY, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2012
L. Capital Assets
Capital assets, which include property, plant, equipment and infrastructure assets (e.g., roads,
bridges, sidewalks, and similar items), and intangible assets such as easements are reported in
the applicable governmental or business-type activities columns in the government-wide financial
statements. Capital assets are defined by the government as assets with an initial, individual
cost of more than $5,000 (with the exception of computer equipment) (amount not rounded) and
an estimated useful life in excess of one year. Such assets are recorded at historical cost or
estimated historical cost if purchased or constructed. Donated capital assets are recorded at
estimated fair market value at the date of donation.
In the case of the initial capitalization of general infrastructure assets (i.e., those reported by
governmental activities) the government chose to include all such items regardless of their
acquisition date or amount. The City was able to estimate the historical cost for the initial
reporting of these assets through back-trending (i.e., estimating the current replacement cost of
the infrastructure to be capitalized and using an appropriate price-level index to deflate the cost
of the infrastructure to be capitalized and using an appropriate price-level index to deflate the
cost to the acquisition year or estimated acquisition year).
The costs of normal maintenance and repairs that do not add to the value of the asset or
materially extend assets lives are not capitalized.
Major outlays for capital assets and improvements are capitalized as projects are constructed.
Interest incurred during the construction phase of capital assets of business-type activities is
included as part of the capitalized value of the assets constructed. For the year ended December
31, 2012, no interest was capitalized in connection with construction in progress.
Property, plant and equipment of the primary government, and the component units, are
depreciated using the straight line method over the following estimated useful lives:
Assets
Improvements other than building 20—25 years
Buildings and structures 20—25 years
Machinery and equipment 5— 10 years
Infrastructure 25 years
56
CITY OF FRIDLEY, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2012
M. Compensated Absences
All liabilities for compensated absences, both current and long-term, for annual leave, severance
and separation pay are accounted for in the Employee Benefit Fund, an Internal Service Fund.
Each year compensated absence expenditures and expenses are recorded in the Governmental
and Proprietary Funds respectively, equivalent to the full amount accrued by fund employees
during the year. These charges are offset by a corresponding transfer of assets from the home
department funds to the Employee Benefit Fund to fund the liability. This liability represents the
maximum possible dilution of Employee Benefit Fund assets by retirements or extended leaves
by employees. The personnel ordinance limits the annual accumulation of benefits that can be
accumulated from year-to-year.
N. Long-Term Obligations
In the government-wide financial statements and proprietary fund types in the fund financial
statements, long-term debt and other long-term obligations are reported as liabilities in the
applicable governmental activities, business-type activities, or proprietary fund type statement of
net assets. Bond premiums and discounts, as well as issuance costs, are generally immaterial
and are expensed in the year of bond issuance. Material premiums and discounts are deferred
and amortized over the life of the bonds.
In the fund financial statements, governmental fund types recognize bond premiums and
discounts, as well as bond issuance costs, during the current period. The face amount of debt
issued is reported as other financing sources. Premiums received on debt issuances are
reported as other financing sources while discounts on debt issuances are reported as other
financing uses. Issuance costs, whether or not withheld from the actual debt proceeds received,
are reported as debt service expenditures.
O. Fund Balance Classifications
In the fund financial statements, governmental funds report fund balance in classifications that
disclose constraints for which amounts in those funds can be spent. These classifications are as
follows:
Nonspendable-consists of amounts that are not in spendable form, such as prepaid items.
Restricted - consists of amounts related to externally imposed constraints established by
creditors, grantors or contributors; or constraints imposed by state statutory provisions.
Committed- consists of internally imposed constraints. These constraints are established by
Resolution of the City Council.
Assigned - consists of internally imposed constraints. These constraints reflect the specific
purpose for which it is the City's intended use. The City Council has adopted a fund balance
policy which delegates the authority to assign amounts for specific purposes to the Finance
Director and/or City Manager.
Unassigned - is the residual classification for the general fund and also reflects negative
residual amounts in other funds.
57
CITY OF FRIDLEY, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2012
When both restricted and unrestricted resources are available for use, it is the policy's olic to first
Y Y
use restricted resources, and then use unrestricted resources as they are needed.
When committed, assigned or unassigned resources are available for use, it is the City's policy to
use resources in the following order; 1) committed 2) assigned and 3) unassigned.
P. Interfund Transactions
Interfund services provided and used are accounted for as revenues, expenditures or expenses.
Transactions that constitute reimbursements to a fund for expenditures/expenses initially made
from it that are properly applicable to another fund, are recorded as expenditures/expenses in the
reimbursing fund and as reductions of expenditures/expenses in the fund that is reimbursed.
Interfund loans are reported as an interfund loan receivable or payable which offsets the
movement of cash between funds. All other interfund transactions are reported as transfers.
Q. Use of Estimates
The preparation of financial statements in accordance with generally accepted accounting
principles (GAAP) requires management to make estimates that affect amounts reported in the
financial statements during the reporting period. Actual results could differ from such estimates.
R. Reconciliation of Government-Wide and Fund Financial Statements
1. Explanation of certain differences between the governmental fund balance sheet and the
government-wide statement of net position
The governmental fund balance sheet includes reconciliation between fund balance — total
governmental funds and net position — governmental activities as reported in the
government-wide statement of net position. One element of that reconciliation explains that
"long-term liabilities, including bonds payable, are not due and payable in the current period
and therefore are not reported in the funds". The details of this ($8,280,896) difference are
as follows:
Bonds payable ($7,660,000)
Accrued interest payable (94,738)
Other post employment benefits payable (526,158)
Net adjustment to increase net changes in fund
balances -total governmental funds to arrive at
changes in net position of governmental activities ($8,280,896)
58
CITY OF FRIDLEY, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2012
2. Explanation of certain differences between the governmental fund statement of revenues,
expenditures and changes in fund balances and the government-wide statement of activities
The governmental fund statement of revenues, expenditures and changes in fund balances
includes reconciliation between net changes in fund balances—total governmental funds and
changes in net position of governmental activities as reported in the government-wide
statement of activities. One element of that reconciliation explains that "governmental funds
report capital outlays as expenditures. However, in the statement of activities the cost of
those assets is allocated over their estimated useful lives and reported as depreciation
expense". The details of this ($996,298) difference are as follows:
Capital outlay $1,639,773
Less maintenance projects not capitalized (725,293)
Depreciation expense (1,910,778)
Net adjustment to decrease net changes in fund
balances-total governmental funds to arrive at
changes in net position of governmental activities ($996,298)
Another element of that reconciliation states that"revenues on the statement of activities that
do not provide current financial resources are not reported as revenues in the funds". The
details of this($117,548) difference are as follows:
General property taxes deferred revenue:
At December 31, 2011 ($305,304)
At December 31, 2012 227,717
Special assessments deferred revenue:
At December 31, 2011 (2,037,706)
At December 31, 2012 1,997,745
Net adjustments to decrease net changes in fund
balances -total governmental funds to arrive at
changes in net position of governmental activities ($117,548)
59
CITY OF FRIDLEY, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2012
Another element of that reconciliation states that"the issuance of long-term debt(e.g., bonds,
leases) provides current financial resources to governmental funds, while the repayment of
the principal on long-term debt consumes the current financial resources of governmental
funds". Neither transaction, however, has any effect on net position. The details of this
($340,000) difference are as follows:
Bonds issued ($1,280,000)
Principal repayments:
G.O. Improvement bonds 940,000
Net adjustment to increase net changes in fund
balances-total governmental funds to arrive at
changes in net position of governmental activities ($340,000)
S. Restricted Assets
Cash balances in the Water and Sewer Enterprise Funds is restricted at December 31, 2012 and
2011, for unspent bond proceeds.
T. Reclassifications
Certain amounts presented in the prior year data have been reclassified in order to be consistent
with the current year's presentation.
U. Comparative Totals
The basic financial statements, required supplementary information, combining and individual
fund financial statements and schedules, and supplementary financial information include certain
prior-year summarized comparative information in total but not at the level of detail required for a
presentation in conformity with generally accepted accounting principles. Accordingly, such
information should be read in conjunction with the City's financial statements for the year ended
December 31, 2011, from which the summarized information was derived.
2. Deposits and Investments
A. Deposits
In accordance with Minnesota Statutes, the City maintains deposits at those depository banks
authorized by the City Council, all of which are members of the Federal Reserve System.
Minnesota Statutes require that all City deposits be protected by insurance, surety bond, or
collateral. The market value of collateral pledged must equal 110% of the deposits not covered
by insurance or bonds.
60
CITY OF FRIDLEY, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2012
Minnesota Statutes require that securities pledged as collateral be held in safekeeping by the
City Treasurer or in a financial institution other than that furnishing the collateral. Authorized
collateral includes the following:
a) United States government treasury bills, treasury notes, treasury bonds;
b) Issues of United States government agencies and instrumentalities as quoted by a
recognized industry quotation service available to the government entity;
c) General obligation securities of any state or local government with taxing powers which is
rated "A" or better by a national bond rating service, or revenue obligation securities of any
state or local government with taxing powers which is rated "AA" or better by a national bond
rating service;
d) Unrated general obligation securities of a local government with taxing powers may be
pledged as collateral against funds deposited by that same local government entity:
e) Irrevocable standby letters of credit issued by Federal Home Loan Banks to a municipality
accompanied by written evidence that the bank's public debt is rated "AA" or better by
Moody's Investors Service, Inc. or Standard & Poor's Corporation; and
f) Time deposits that are fully insured by any Federal agency.
Custodial Credit Risk — Deposits: Custodial credit risk is the risk that in the event of a bank
failure, the City's deposits may not be returned to it. State Statutes require that insurance, surety
bonds or collateral protect all City deposits. The market value of collateral pledged must equal
110% of deposits not covered by insurance or bonds. As of December 31, 2012, the bank
balance of the City's deposits was covered by federal depository insurance or covered by
perfected collateral pledged and held in the City's name.
B. Investments
Minnesota Statutes authorize the City to invest in the following:
a) Direct obligations or obligations guaranteed by the United States or its agencies, its
instrumentalities or organizations created by an act of congress, excluding mortgage-backed
securities defined as high risk.
b) Shares of investment companies registered under the Federal Investment Company Act of
1940 and whose only investments are in securities described in (a) above, general obligation
tax-exempt securities, or repurchase or reverse repurchase agreements.
c) Obligations of the State of Minnesota or any of its municipalities as follows:
1) any security which is a general obligation of any state or local government with taxing
powers which is rated "A" or better by a national bond rating service;
2) any security which is a revenue obligation of any state or local government with taxing
powers which is rated "AA" or better by a national bond rating service; and
3) a general obligation of the Minnesota housing finance agency which is a moral obligation
of the State of Minnesota and is rated "A" or better by a national bond rating agency.
61
CITY OF FRIDLEY, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2012
d) Bankers acceptance of United States banks eligible for purchase by the Federal Reserve
System.
e) Commercial paper issued by United States corporations or their Canadian subsidiaries, of the
highest quality, and maturing in 270 days or less.
f) Repurchase or reverse repurchase agreements with banks that are members of the Federal
Reserve System with capitalization exceeding $10,000,000; a primary reporting dealer in
U.S. government securities to the Federal Reserve Bank of New York; certain Minnesota
securities broker-dealers; or, a bank qualified as a depositor.
g) General obligation temporary bonds of the same governmental entity issued under section
429.091, subdivision 7; 469.178, subdivision 5; or 475.61, subdivision 6.
As of December 31, 2012 the City had the following investments and maturities:
Investment Maturities(in Years)
Fair Less Over
Investment Type Rating Value Than 1 1-5 6-10 10 Years
FNMC MA $750,000 $ - $750,000 $ - $ -
Federal Home Loan Bank AAA 6,961,847 - - 6,961,847 -
Federal National Mortgage Association AAA 500,130 - 500,130 - -
Federal Home Loan Mortgage Corporation AAA 2,257,378 - 505,135 1,752,243 -
Local government bonds AA 13,325,823 4,316,628 8,792,807 216,388 -
Brokered CDs N/R 2,607,696 248,908 2,111,647 247,141 -
Money market N/R 6,896,131 6,896,131 - - -
Total $33,299,005 $11,461,667 $12,659,719 $9,177,619 $0
Total investments $33,299,005
Deposits 1,823,348
Petty cash 4,550
Total cash and investments $35,126,903
Following is a reconciliation to the City's cash and investment balances as of December 31, 2012:
Cash and investments- primary government:
Governmental and business-type (statement A-1) $33,947,623
Restricted cash business-type (statement A-1) 1,154,649
Fiduciary (statement A-9) _ 24,631
$35,126,903
As of December 31, 2012 the HRA had the following investments and maturities:
Investment Maturities(in Years) ,
Fair Less Over
Investment Type Rating Value Than 1 1-5 6-10 10 Years
United States Treasury Bond AAA $166,219 $ - $ - $ - $166,219
FNMA AAA 750,390 - 750,390 - -
Local government bonds A 5,290,329 1,453,310 3,837,019 - -
Money market N/R 3,453,302 3,453,302 - - -
Total $9,660,240 $4,906,612 $4,587,409 $0 $166,219
Total investments $9,660,240 I
Deposits 376,694
Total cash and investments $10,036,934
62
CITY OF FRIDLEY, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2012
C. Investment Risks
Custodial credit risk— investments — For investments in securities, custodial credit risk is the risk
that in the event of failure of the counterparty to a transaction, the City will not be able to recover
the value of its investment securities that are in the possession of an outside party. Investments
in investment pools and money markets are not evidenced by securities that exist in physical or
book entry form, and therefore are not subject to custodial credit risk disclosures. The City policy
is to limit its exposure by holding investments in securities with a major bank's corporate trust
department. Investments are delivered to the City's trust account and then payment is released
to the broker-dealer.
Interest rate risk — Interest rate risk is the risk that changes in interest rates of debt investments
could adversely affect the fair value of an investment. The City's investment policy requires the
City to diversify its investment portfolio to eliminate the risk of loss resulting from over
concentration of assets in a specific maturity. The policy also states the City's investment
portfolio will remain sufficiently liquid to enable the City to meet all operating requirements which
might be reasonably anticipated.
Credit Risk— Credit risk is the risk that an issuer or other counterparty to an investment will be
unable to fulfill its obligation to the holder of the investment. State law limits investments to
commercial paper to those rated in the highest quality category by at least two nationally
recognized rating agencies; in any security of the State of Minnesota or any of its municipalities
which is rated "A" or better by a national bond rating service for general obligation and rated "AA"
or better for a revenue obligation; a general obligation of the Minnesota Housing Finance Agency
to those rated "A" or better by a national bond rating agency; mutual funds or money market
funds whose investments are restricted to securities described in MS 118A.04. The City's
investment policy does not place further restrictions on investment options.
Concentration of credit risk—Concentration of credit risk is the risk of loss that may be attributed
to the magnitude of a government's investment in a single issuer. The City places no limit on the
amount the City may invest in any one issuer. Investments in a single issuer exceeding 5% of
the City's overall investment portfolio are in various holdings as follows:
Federal Home Loan Bank 20.91%
Federal Home Loan Mortgage Corporation 6.78%
Local government bonds:
El Paso Texas 6.30%
Concentration of credit risk—Concentration of credit risk is the risk of loss that may be attributed
to the magnitude of a government's investment in a single issuer. The HRA places no limit on the
amount the HRA may invest in any one issuer. Investments in a single issuer exceeding 5% of
the HRA's overall investment portfolio are in various holdings as follows:
Federal National Mortgage Association 7.77%
Local government bonds:
New York Clean Water 10.44%
Baltimore MD 7.01%
Kansas City MO 10.59%
63
CITY OF FRIDLEY, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2012
3. Receivables
Significant receivables balances not expected to be collected within one year of December 31, 2012 are
as follows:
Primary Government
Major Funds
Special Special
Assessment Assessment Nonmajor
General Debt Service Capital Projects Funds Total
Special assessments receivable $42,067 $1,383,764 $186,032 $ - $1,611,863
Delinquent property taxes 134,034 - 10,897 4,469 149,400
$176,101 $1,383,764 $196,929 $4,469 $1,761,263
HRA Component Unit
Major Funds
Revolving General
Loan Fund Total
Mortgage receivable $1,109,620 $ - $1,109,620
Allowance for uncollectible accounts (57,959) - ($57,959)
Delinquent tax increment - 6,750 $6,750
$1,051,661 $6,750 $1,058,411
Governmental funds report deferred revenue in connection with receivables for revenues that are not
considered to be available to liquidate liabilities of the current period. Governmental funds also defer
revenue recognition in connection with resources that have been received, but not yet earned. At the end
of the current fiscal year, the various components of deferred revenue and unearned revenue reported in
the governmental funds were as follows:
Unavailable Unearned Total
Delinquent property taxes receivable(General Fund) $204,644 $ - $204,644
Delinquent property taxes receivable(Capital Improvements Fund) 201 - 201
Delinquent property taxes receivable(Special Assessment Debt Service Fund) 16,179 - 16,179
Delinquent property taxes receivable(Nonmajor Funds) 6,633 - 6,633
Special assessments not yet due(General Fund) 52,137 - 52,137
Special assessments not yet due(Special Assessment Construction Fund) 230,567 - 230,567
Special assessments not yet due(Special Assessment Debt Service Fund) 1,715,031 - 1,715,031
Unearned grant funds(Nonmajor Funds) - 127,194 127,194
Total deferred/unearned revenue for governmental funds $2,225,392 $127,194 $2,352,586
64
CITY OF FRIDLEY, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2012
4. Capital Assets
Capital asset activity for the year ended December 31, 2012 was as follows:
Beginning Ending
Primary Government Balance Increases Decreases Balance
Governmental activities:
Capital assets,not being depreciated:
Land $2,841,516 $ - $ - $2,841,516
Construction in progress 6,000 - (6,000) -
Total capital assets,not being depreciated 2,847,516 0 (6,000) 2,841,516
Capital assets,being depreciated:
Buildings and structures 7,981,140 - - 7,981,140
Machinery and equipment 8,868,123 786,847 (959,794) 8,695,176
Improvements 5,837,835 337,065 - 6,174,900
Infrastructure 33,150,978 - - 33,150,978
Total capital assets,being depreciated 55,838,076 1,123,912 (959,794) 56,002,194
Less accumulated depreciation for:
Buildings and structures 6,225,203 292,154 - 6,517,357
Machinery and equipment 7,039,669 533,040 (952,946) 6,619,763
Improvements 4,052,605 336,338 - 4,388,943
Infrastructure 19,493,476 885,369 - 20,378,845
Total accumulated depreciation 36,810,953 2,046,901 (952,946) 37,904,908
Total capital assets being depreciated-net 19,027,123 (922,989) (6,848) 18,097,286
Governmental activities capital assets-net $21,874,639 ($922,989) ($12,848) $20,938,802
Beginning Ending
Primary Government Balance Increases Decreases Balance
Business-type activities:
Capital assets,not being depreciated:
Land $306,477 $ - $ - $306,477
Construction in progress - 6,395 - 6,395
Total capital assets,not being depreciated 306,477 6,395 0 312,872
Capital assets,being depreciated:
Buildings and structures 3,262,996 - - 3,262,996
Improvements other than buildings 14,240,340 297,379 - 14,537,719
Machinery and equipment 3,004,752 81,168 (143,817) 2,942,103
Infrastructure 23,330,480 669,720 - 24,000,200
Total capital assets,being depreciated 43,838,568 1,048,267 (143,817) 44,743,018
Less accumulated depreciation for
Buildings and structures 1,704,680 86,511 - 1,791,191
Improvements other than buildings 7,175,337 575,560 - 7,750,897
Machinery and equipment 2,517,844 127,848 (143,817) 2,501,875
Infrastructure 12,991,353 546,452 - 13,537,805
Total accumulated depreciation 24,389,214 1,336,371 (143,817) 25,581,768
Total capital assets being depreciated-net 19,449,354 (288,104) 0 19,161,250
Business-type activities capital assets-net $19,755,831 ($281,709) $0 $19,474,122
Component unit:
Capital assets,not being depreciated:
Land $2,023,511 $0 $0 $2,023,511
65
CITY OF FRIDLEY, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2012
Depreciation expense was charged to functions/programs of the primary government as follows:
Governmental activities:
General government $154,570
Public safety 258,761
Public works, including depreciation of general infrastructure assets 1,314,903
Recreation and naturalist 182,544
Capital assets held by the government's internal service funds are 136,123
charged to the various functions based on their usage of the assets -
Total depreciation expense-governmental activities $2,046,901
Business-type activities:
Liquor $29,437
Water 764,093
Sewer 304,554
Storm water 238,287
Total increases in accumulated depreciation $1,336,371
66
CITY OF FRIDLEY, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2012
5. Long-Term Debt
The City issues general obligation bonds to provide funds for the acquisition and construction of major
capital facilities. The reporting entity's long-term debt is segregated between the amounts to be repaid
from governmental activities and amounts to be repaid from business-type activities.
As of December 31, 2012, the governmental long-term bonded debt and loans of the financial reporting
entity consisted of the following:
Governmental Activities:
$1,915,000 General Obligation Improvement Bonds,Series 2008A due in varying annual $1,405,000
installments of$165,000-$225,000 through February 1,2019; interest at 2.95%-4.00%.
$1,910,000 General Obligation Improvement Bonds,Series 2007A due in varying annual 1,240,000
installments of$155,000-$230,000 through August 1,2018; interest at 3.50%-3.85%.
$1,215,000 General Obligation Improvement Bonds,Series 2010C due in varying annual 1,050,000
installments of$55,000-$135,000 through February 1,2021; interest at 2.00%-3.00%.
$1,805,000 General Obligation Improvement Bonds of 2005 due in varying annual installments of 795,000
$155,000-$210,000 through February 1,2016;interest at 2.80%-3.750%.
$2,505,000 General Obligation Improvement Bonds of 2006 due in varying annual installments 1,390,000
of$205,000-$305,000 through February 1,2017; interest at 4.00%.
$550,000 General Obligation Equipment Certificates,Series 2010B due in varying annual 500,000
installments of$50,000-$70,000 through February 1,2020; interest at 2.00%-3.00%
$1,280,000 General Obligation Equipment Certificates,Series 2012A due in varying annual 1,280,000
installments of$135,000-$150,000 through February 1,2022; interest at 1.00%-1.65%
Subtotal governmental activities $7,660,000
Business-Type Activities:
$1,180,000 General Obligation Water Revenue Bonds of 1998,due in varying annual $ -
installments of$90,000-$130,000 through February 1,2011.
$1,790,000 General Obligation Water Revenue Bonds of 2004 due in varying annual installments 1,405,000
of$50,000-$230,000 through February 1,2019; interest at 2.50%-4.00%.
$1,005,000 General Obligation Water and Storm Water Revenue Bonds of 2004 due in varying -
annual installments of$160,000-$235,000 through February 1,2012;interest at 2.00%-3.25%.
$3,725,000 General Obligation Water Revenue Bonds of 2008B due in varying 2,855,000
annual installments of$240,000-$315,000 through February 1,2023;interest at 2.95%-4.50%.
$2,810,000 General Obligation Utility Revenue Bonds of 2010A due in varying annual 2,810,000
installments of$160,000-$265,000 through February 1,2026; interest at 2.50%-3.50%
Unamortized discount (2,209)
Subtotal business-type activities 7,067,791
Total primary government $14,727,791
67
CITY OF FRIDLEY, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2012
Annual debt service requirements to maturity for general obligation bonds and loans are as follows:
Primary Government
Governmental Activities Business-Type Activities
Year Ending G.O. Improvement G.O. Equipment Certificates Revenue Bonds
December 31, Principal _ Interest Principal Interest Principal Interest
2013 $925,000 $198,413 $55,000 $25,763 $654,637 $243,376
2014 955,000 165,235 195,000 25,655 569,637 223,459
2015 990,000 129,815 200,000 23,080 584,637 203,060
2016 1,030,000 92,090 200,000 20,330 609,637 181,610
2017 855,000 56,360 205,000 17,205 624,637 159,191
2018 570,000 29,503 205,000 13,855 654,637 135,623
2019 355,000 12,450 210,000 10,371 679,969 110,748
2020 135,000 3,975 215,000 6,570 465,000 89,585
2021 65,000 975 145,000 3,526 490,000 72,080
2022 - - 150,000 1,238 505,000 53,688
2023 - - - - 530,000 34,125
2024 - - - - 225,000 20,281
2025 - - - - 235,000 12,513
2026 - - - - 240,000 4,200
Total $5,880,000 $688,815 $1,780,000 $147,593 $7,067,791 $1,543,538
Long-term liability activity for the year ended December 31, 2012, was as follows:
Beginning Ending Due Within
_ Balance Additions Reductions Balance One Year
Governmental activities:
Bonds payable:
G.O. improvement bonds $6,770,000 $ - ($890,000) $5,880,000 $925,000
G.O. equipment certificates _ 550,000 1,280,000 (50,000) 1,780,000 55,000
Total bonds payable 7,320,000 1,280,000 (940,000) 7,660,000 980,000
Compensated absences 996,706 790,642 (819,597) 967,751 763,779
Total government activity
long-term debt $8,316,706 $2,070,642 ($1,759,597) $8,627,751 $1,743,779
Business-type activities:
Bonds payable:
G.O. revenue bonds $7,622,535 $ - ($554,744) $7,067,791 $654,637
Compensated absences are generally liquidated by the Employee Benefits Fund. All long-term bonded
indebtedness outstanding at December 31, 2012 is backed by the full faith and credit of the City,
including improvement and revenue bond issues. Delinquent assessments receivable at December 31,
2012 totaled $42,290.
68
CITY OF FRIDLEY, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2012
Revenues Pledged
Revenue Pledged Current Year
Percent of Debt service Principal Pledged
Use of total as a%of Term of Remaining and Interest Revenue
Bond Issue Proceeds Type debt service net revenues Pledge Principal paid received
2012A Capital Equipment Property Taxes 100% 2013- $1,280,000 $ - $
a'4 2022
2010B Capital Equipment Property Taxes 100% e 2011- 500,000 63,450 70,104
.a� 2020
2010C Street Improvements Property Taxes and 100% 2011- 1050000 139,700 109,434
Special Assessments 2021
2008A Street Improvements Property Taxes and 100% 2008- 1,405,000 233,144 200,295
Special Assessments 2019
2007A Street Improvements Property Taxes and 100% 2007- 1,240,000 229,508 209,893
Special Assessments z;.;;;; 2018
2006A Street Improvements Property Taxes and 100% .. 2007- 1,390,000 300,400 253,428
Special Assessments 2017
2005A Street Improvements Property Taxes and 100% - 2006- 795,000 216,751 218,414
Special Assessments 2016
Water,Sewer and
2010A Utility Revenue Bonds Infrastructure improvements Storm Customer 100% 0.74% 2011- 1,900,000 58,438 7,876,860
Net Revenue 2026
2008B Water Revenue Bonds Infrastructure improvements Water Customer 100% 11.85% 2008- 2,855,000 328,635 2,773,101
Net Revenue 2023
2004 Water Revenue Bonds Infrastructure improvements Water Customer 100% 8.64% 2004- 1,405,000 239,629 2,773,101
Net Revenue 2019
2004 Water&Storm Revenue Infrastructure improvements Water and Storm 100% 4.89% 2004- - 162,600 3,327,606
Bonds Customer Net Revenue 2012
6. Defined Benefit Pension Plans-Statewide
A. Plan Description
All full-time and certain part-time employees of the City are covered by defined benefit plans
administered by the Public Employees Retirement Association of Minnesota (PERA). PERA
administers the General Employees Retirement Fund (GERF) and the Public Employees Police
and Fire Fund (PEPFF), which are cost-sharing, multiple-employer retirement plans. These
plans are established and administered in accordance with Minnesota Statutes, Chapters 353
and 356.
69
CITY OF FRIDLEY, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2012
GERF members belong to either the Coordinated Plan or the Basic Plan. Coordinated Plan
members are covered by Social Security and Basic Plan members are not. All new members
must participate in the Coordinated Plan. All police officers, firefighters and peace officers who
qualify for membership by statute are covered by the PEPFF.
PERA provides retirement benefits as well as disability benefits to members, and benefits to
survivors upon death of eligible members. Benefits are established by State Statute, and vest
after three years of credited service. The defined retirement benefits are based on a member's
highest average salary for any five successive years of allowable service, age, and years of
credit at termination of service.
The benefit provisions stated in the previous paragraphs of this section are current provision and
apply to active plan participants. Vested, terminated employees who are entitled to benefits but
are not receiving them yet are bound by the provisions in effect at the time they last terminated
their public service.
PERA issues a publicly available financial report that includes financial statements and required
supplementary information for GERF and PEPFF. That report may be obtained on the internet at
www.mnpera.org, by writing to PERA at 60 Empire Drive#200, St. Paul, Minnesota, 55103-2088
or by calling (651)296-7460 or 1-800-652-9026.
B. Funding Policy
Minnesota Statutes Chapter 353 sets the rates for employer and employee contributions. These
statutes are established and amended by the state legislature. The City makes annual
contributions to the pension plans equal to the amount required by state statutes. GERF Basic
Plan members and Coordinated Plan members were required to contribute 9.10% and 6.25%,
respectively, of their annual covered salary in 2012. PEPFF members were required to
contribute 9.6% of their annual covered salary in 2012. The City was required to contribute the
following percentages of annual covered payroll in 2012: 11.78% for Basic Plan members,
7.25% for Coordinated Plan members, and 14.4% for PEPFF members. The City's contributions
to the General Employees Retirement Fund for the years ending December 31, 2012, 2011 and
2010 were$397,492, $400,177 and $387,554, respectively. The City's contributions to the Public
Employees Police and Fire Fund for the years ending December 31, 2012, 2011 and 2010 were
$501,259, $477,618 and $487,524, respectively. The City's contributions were equal to the
contractually required contributions for each year as set by state statute.
C. Public Employees Retirement Association (PERA) -Defined Contribution
Plan Description
All council members of the City of Fridley are covered by a defined contribution pension plan
administered by the Public Employees Retirement Association of Minnesota (PERA). PERA
administers the Public Employees Defined Contribution Plan (PEDCP) which is a multiple-
employer deferred compensation plan.
Benefit Provisions and Contribution Rates
The PEDCP is a tax qualified plan under Section 401(a) of the Internal Revenue Code and all
contributions by or on behalf of employees are tax deferred until time of withdrawal.
70
CITY OF FRIDLEY, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2012
Plan benefits depend solely on amounts contributed to the plan plus investment income, less
administrative expenses. Minnesota Statutes, Chapter 353D.03, specifies plan provisions,
including the employee and employer contribution rates for those qualified personnel who elect to
participate. An eligible elected official who decides to participate contributes 5 percent of salary
which is matched by the elected official's employer. For ambulance service personnel, employer
contributions are determined by the employer, and for salaried employees must be a fixed
percentage of salary. Employer contributions for volunteer personnel may be a unit value for
each call or period of alert duty. Employees who are paid for their services may elect to make
member contributions in an amount not to exceed the employer share. Employer and employee
contributions are combined and used to purchase shares in one or more of the seven accounts of
the Minnesota Supplemental Investment Fund. For administering the plan, PERA receives 2
percent of employer contributions and twenty-five hundredths of one percent of the assets in
each member's account.
Total contributions made by the City during fiscal year 2012 were:
Percentage of
Amount Covered Payroll Required
Employees Employer Employees Employer Rates
PEDCP $2,106 $2,106 5.00% 5.00% 5.00%
7. Defined Contribution Pension Plan -Fridley Volunteer Firefighters Relief Association
Plan Description
The Fridley Volunteer Firefighters Relief Association (Association), is a single employer public
employee retirement system that acts as a common investment administrator for all of the City's
firefighters. Pursuant to a 1987 amendment to its by-laws, the pension plan is a defined contribution
plan, prior to 1987 the pension plan was a defined benefit pension plan.
Benefits and contribution requirements are established by Association's by-laws and can be
amended by the Association's Board of Trustees with approval from the City of Fridley, Minnesota.
All provisions are within limitations established by Minnesota Statutes.
Type of Benefit
The exclusive pension provided by the Association is a "Defined Contribution Lump Sum Service
Pension,"as defined in Minnesota Statutes§424A.02, Subdivision 4.
Contribution Made
The City collected and remitted $101,103 and $99,320 in State Aid to the Association for 2012 and
2011, respectively. This transaction is recorded as revenue and expenditures in the City's financial
statements.
During 2012 and as of December 31, 2012, the Association held no securities issued by the City
or other related parties.
71
CITY OF FRIDLEY, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2012
8. Other Post-Employment Benefits
A. Plan Description
In addition to providing the pension benefits described in Note 6, the City provides post-
employment health care benefits (as defined in paragraph B) for retired employees and police
and firefighters disabled in the line of duty, through a single-employer defined benefit plan. The
term Plan refers to the City's requirement by State Statute to provide retirees with access to
health insurance. The OPEB plan is administered by the City. The authority to provide these
benefits is established in Minnesota Statutes Sections 471.61 Subd. 2a, and 299A.465. The
benefits, benefit levels, employee contributions and employer contributions are governed by the
City and can be amended by the City through its personnel manual and collective bargaining
agreements with employee groups. The Plan is not accounted for as a trust fund, an irrevocable
trust has not been established to account for the Plan. The Plan does not issue a separate
report.
B. Benefits Provided
Retirees
The City is required by State Statute to allow retirees to continue participation in the City's group
health insurance plan if the individual terminates service with the City through service retirement
or disability retirement. Covered spouses may continue coverage after the retiree's death. The
surviving spouse of an active employee may continue coverage in the group health insurance
plan after the employee's death.
All health care coverage is provided through the City's group health insurance plans. The retiree
is required to pay 100% of their premium cost for the City-sponsored group health insurance plan
in which they participate. The premium is a blended rate determined on the entire active and
retiree population. Since the projected claims costs for retirees exceed the blended premium
paid by retirees, the retirees are receiving an implicit rate subsidy (benefit). The coverage levels
are the same as those afforded to active employees. Upon a retiree reaching age 65 years of
age, Medicare becomes the primary insurer.
The monthly retiree premiums effective January 1, 2012 were:
Single Married
Regular and Dental $694 $2,004
HRA and Dental 585 1,692
HSA and Dental 566 1,635
72
CITY OF FRIDLEY, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31,2012
C. Participants
As of the actuarial valuation dated January 1, 2011, participants consisted of:
Retired participants and beneficiaries
currently receiving benefits 11
Active employees 69
Waiving Coverage 62
Total 142
Participating employers 1
D. Funding Policy
The additional cost of using a blended rate for actives and retirees is currently funded on a pay-
as-you-go basis. The City Council may change the funding policy at any time.
E. Annual OPEB Costs and Net OPEB Obligation
The City's annual other post employment benefit (OPEB) cost is calculated based on the annual
required contribution (ARC) of the employer, an amount actuarially determined in accordance
with the parameters of GASB Statement No. 45. The ARC represents a level of funding that, if
paid on an ongoing basis, is projected to cover normal cost each year and amortize any
unfunded actuarial liabilities (or funding excess) over a period not to exceed 30 years. The net
OPEB obligation as of December 31, 2012, was calculated as follows:
Annual required contribution (ARC) $70,802
Interest on net OPEB obligation 22,483
Adjustment to ARC (32,505)
Annual OPEB cost 60,780
Contributions made during the year (31,535)
Increase in net OPEB obligation 29,245
Net OPEB obligation - beginning of year 562,074
Net OPEB obligation -end of year $591,319
For the governmental activities, other post employment benefits are generally liquidated through
the General Fund.
73
CITY OF FRIDLEY, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2012
The City's annual OPEB cost, the percentage of annual OPEB cost contributed to the Plan and
the net OPEB obligation for 2010 to 2012 was as follows:
Percentage of
Fiscal Year Annual OPEB Employer Annual OPEB Cost Net OPEB
Ended Cost Contributions Contributed Obligation
December 31, 2010 234,080 57,119 24.4% 530,884
December 31, 2011 59,654 28,464 47.7% 562,074
December 31, 2012 60,780 31,535 51.9% 591,319
F. Funded Status and Funding Progress
The City currently has no assets that have been irrevocably deposited in a trust for future health
benefits; therefore, the actuarial value of assets is zero. The funded status of the Plan was as
follows:
Unfunded
Actuarial Actuarial UAAL as a
Actuarial Actuarial Accrued Accrued Funded Covered Percentage of
Valuation Value of Assets Liability(AAL)* Liability(UAAL) Ratio Payroll Covered Payrol
Date (a) (b) (b-a) (a/b) (c) ((b-a)/c)
January 1,2011 $ - $616,348 $616,348 0.0% $8,186,031 7.5%
*Using the projected unit credit actuarial cost method.
G. Actuarial Methods and Assumptions
Actuarial valuations of an ongoing plan involve estimates of the value of reported amounts and
assumptions about the probability of occurrence of events far into the future. Examples include
assumptions about future employment, mortality and the health care cost trend. Amounts
determined regarding the funded status of the plan and the annual required contributions (ARC)
of the employer are subject to continual revision as actual results are compared with past
expectations and new estimates are made about the future. The schedule of funding progress,
presented as required supplementary information following the notes to financial statements,
presents multi-year trend information that shows whether the actuarial value of plan assets is
increasing or decreasing over time relative to the actuarial accrued liabilities for benefits.
74
CITY OF FRIDLEY, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2012
Projections of benefits for financial reporting purposes are based on the substantive plan (the
plan as understood by the employer and plan members) and include the types of benefits
provided at the time of each valuation and the historical pattern of sharing of benefit costs
between the employer and plan members to that point. The actuarial methods and assumptions
used include techniques that are designed to reduce the effect of short-term volatility in actuarial
accrued liabilities and the actuarial value of assets, consistent with the long-term perspective of
the calculations.
In the January 1, 2011 actuarial valuation, the Projected Unit Credit Actuarial cost method was
used. The actuarial assumptions included a 4.0% investment rate of return (net of administrative
expenses) and an initial annual health care cost trend rate of 10% reduced by 0.5% each year to
arrive at an ultimate health care cost trend rate of 5.0%, which includes a 3% inflation
assumption. The actuarial value of assets was $0. The plan's unfunded actuarial accrued
liability is being amortized using the level percentage of projected payroll method over 30 years
on a closed basis. The remaining amortization period at December 31, 2012, was 27 years.
9. Interfund Receivables, Payables and Transfers
Interfund payables and receivables are representative of lending/borrowing arrangements to
cover deficit cash balances at the end of the fiscal year. Interfund receivables and payables of
the City are as follows:
Interfund Interfund
Receivables Payables
Due From/Due To:
Major Funds:
General Fund $97,712 $ -
Nonmajor Governmental Funds:
Special Revenue Funds:
Police Activity Fund - 97,712
$97,712 $97,712
75
CITY OF FRIDLEY, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2012
Interfund receivables and payables of the HRA component unit at December 31, 2012 are as
follows:
Interfund Interfund
Receivables Payables
Due From/Due To:
General Fund $4,508,825 $ -
Capital Projects Funds:
Lake Pointe - 455,303
Gateway East - 679,653
Gateway West - 1,270,109
57th Avenue Redevelopment - 53,760
Housing Replacement - 600,000
Gateway Northeast - 1,450,000
$4,508,825 $4,508,825
The above balances are not expected to be eliminated within one year of December 31, 2012.
Interfund Transfers:
Transfer In Transfer Out
Governmental Funds:
Major Funds:
General Fund (1) (4) $600,000 $ -
Special Assessment Debt Service (1) - 286,819
Capital Improvements (2) - 870,000
Special Assessment Construction Capital Projects (2) 870,000 -
Nonmajor Funds (1) 36,819 -
Total governmental funds 1,506,819 1,156,819
Internal Service Funds:
Employee Benefit(3) - 59,000
Info Systems (3) 59,000 0
Proprietary Funds:
Liquor(4) - 350,000
Total $1,565,819 $1,565,819
(1) Transfer of$250,000 to finance General Fund and $36,819 to finance nonmajor funds
(2)Transfer City portion of various street repairs
(3) Transfer of expenditures related to laserfiche purchase
(4)Annual transfer to finance General Fund
During 2012, the HRA Component Unit had a transfer of $262,907 related to the closure of the
Winfield Fund to the Gateway West Fund. Interfund transfers allow the City and HRA to allocate
financial resources to the funds that receive benefit from services provided by another fund.
Most of the interfund transfers fall under that category.
76
CITY OF FRIDLEY, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2012
10. Fund Balance
A. CLASSIFICATIONS
At December 31, 2012, a summary of the governmental fund balance classifications are as
follows:
Special
Assessment
Debt Construction Capital Other Total Component
_General Fund Service Capital Projects Improvements Governmental City Unit
Nonspendable:
Inventory $66,152 $ - $ - $ - $ - $66,152 $ -
Mortgage loan receivable _ - - - - - - 1,055,575
Total nonspendable 66,152 0 0 0 0 66,152 1,055,575
Restricted for:
Donations 20,810 - - - 6,534 27,344 -
Unspent bond proceeds - - - - 827,273 827,273 -
Debt service - 2,058,929 - - - 2,058,929 -
Tax increment - - - - - - 2,042,018
Cable television equipment - - - - 72,640 72,640 -
Police forfeitures - - - - 127,926 127,926
Total restricted 20,810 2,058,929 0 0 1,034,373 3,114,112 2,042,018
Committed to:
Cable televitsion programming - - - - 1,229,626 1,229,626 -
Recycling programs - - - - 57,390 57,390 -
Nature Center activities - - - - 93,337 93,337 -
Public improvements - - 882,220 - - 882,220 -
Capital equipment - - - - 66,010 66,010 -
Housing loan program - - - - - - 2,853,960
Total committed 0 0 882,220 0 1,446,363 2,328,583 2,853,960
Assigned to: -
Capital improvements - 6,043,123 - 5,740,473 - 11,783,596
Total assigned 0 6,043,123 0 5,740,473 0 11,783,596 0
Unassigned 7,582,360 - - - (97,712) 7,484,648 4,846,126
Total $7,669,322 $8,102,052 $882,220 $5,740,473 $2,383,024 $24,777,091 $10,797,679
B. MINIMUM UNASSIGNED FUND BALANCE POLICY
The City Council has formally adopted a policy regarding the minimum unassigned fund balance
for the General Fund. The most significant revenue source of the General Fund is property
taxes. This revenue source is received in two installments during the year — June and
December. As such, it is the City's goal to begin each fiscal year with sufficient working capital to
fund operations between each semi-annual receipt of property taxes. The City's policy for
unassigned funds in the General Fund is equal to 35% - 50% of the following year General Fund
expenditures.
At December 31, 2012, the unassigned fund balance of the General Fund was $7,582,360,
compared to its targeted unassigned fund balance of between $5,146,000 and $7,351,000.
77
1
CITY OF FRIDLEY, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2012
11. Tax Increment Districts
The HRA is the administering authority for the following Tax Increment Districts:
Fiscal Retained
Year Tax Capacity Values Disparity By
Established District _ District Name Current Original Captured Adjustments Authority
1985 6 Lake Pointe $969,454 $326,940 $642,514 $ - $642,514
1986 7 Winfield 63,562 3,582 59,980 - 59,980
1989 9 Onan/Old Central Avenue 397,661 42,978 354,683 - 354,683
1992 11 University/Osborne 86,540 26,478 60,062 - 60,062
1992 12 McGlynn's 78,894 41,254 37,640 - 37,640
1995 13 Satellite Lane Apartments 38,460 2,334 36,126 - 36,126
1997 16 57th Avenue Replacement 30,186 7,301 22,885 - 22,885
2000 17 Gateway East 33,911 5,042 28,869 - 28,869
2007 18 Gateway West 13,107 4,258 8,849 - 8,849
2007 19 Main Street 179,468 45,628 133,840 133,840
1995 HR1/04 Housing Replacement 4,446 543 3,903 3,903
1995 HR1/05 Housing Replacement 1,965 270 1,695 - 1,695
1995 HR1/06 Housing Replacement 4,480 686 3,794 - 3,794
1995 HR1/Q2 Housing Replacement 1,858 318 1,540 - 1,540
1995 HR1/Q3 Housing Replacement 1,519 393 1,126 - 1,126 I
1995 HR1/Q4 Housing Replacement 4,766 781 3,985 - 3,985
1995 HR1/S3 Housing Replacement 1,967 516 1,451 - 1,451
1995 HR1/S4 Housing Replacement 2,418 563 1,855 - 1,855
1995 HR1/S5 Housing Replacement 1,475 375 1,100 - 1,100
1995 HR1/S6 Housing Replacement 1,582 443 1,139 - 1,139
1995 HR1/T7 Housing Replacement 2,098 640 1,458 - 1,458
1995 HR1/W1 Housing Replacement 1,663 595 1,068 - 1,068
Totals $1,921,480 $511,918 $1,409,562 $0 $1,409,562
12. Commitments and Contingencies
A. Risk Management
The City is exposed to various risks of loss related to torts; theft of, damage to, and destruction of
assets; errors and omissions; injuries to employees; and natural disasters. During 1987, the City
established the Self Insurance Fund (an Internal Service Fund) to account for and finance its
uninsured risks of loss.
Workers compensation coverage is provided through a pooled self-insurance program through
the League of Minnesota Cities Insurance Trust (LMCIT). The City pays an annual premium to
the LMCIT. The City is subject to supplemental assessments if deemed necessary by the
LMCIT. The LMCIT reinsures through Workers Compensation Reinsurance Association (WCRA)
as required by law. For workers compensation, the City is subject to a $2,500 deductible.
Property and casualty insurance coverage is provided through a pooled self-insurance program
through LMCIT. The City pays an annual premium to the LMCIT. The City is subject to
supplemental assessments if deemed necessary by the LMCIT. The LMCIT reinsures through
commercial companies for claims in excess of various amounts. For property (other than
vehicles for which the City is self-insured) and casualty coverage, the City has a $75,000
deductible per occurrence with a $150,000 annual maximum. This deductible gets paid out of the
Self-Insurance Fund as necessary.
78
CITY OF FRIDLEY, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2012
The City continues to carry commercial insurance for all other risks of loss, including employee
health and disability insurance.
There were no significant reductions in insurance from the previous year or settlements in excess
of insurance coverage for any of the past three fiscal years.
In 1990, the General Fund contributed $1,000,000 to the Self Insurance Fund in lieu of the Self
Insurance Fund charging losses back to each fund.
There is no recorded liability for unpaid claims because the amount of such claims, if any, is
considered to be immaterial.
As of December 31, 2012, the Self Insurance Fund has accumulated equity in the amount of
$1,455,659 to cover future claims and losses.
B. Litigation
The City attorney has indicated that existing and pending lawsuits, claims and other actions in
which the City is a defendant are either covered by insurance; of an immaterial amount; or, in the
judgment of the City attorney, remotely recoverable by plaintiffs.
C. Federal and State Funds
The City receives financial assistance from federal and state governmental agencies in the form
of grants. The disbursement of funds received under these programs generally requires
compliance with the terms and conditions specified in the grant agreements and are subject to
audit by the grantor agencies. Any disallowed claims resulting from such audits could become a
liability of the applicable fund. However, in the opinion of management, any such disallowed
claims will not have a material effect on any of the financial statements of the individual fund
types included herein or on the overall financial position of the City at December 31, 2012.
D. Tax Increment Districts
The City's tax increment districts are subject to review by the State of Minnesota Office of the
State Auditor (OSA). Any disallowed claims or misuse of tax increments could become a liability
of the applicable fund. Management has indicated that they are not aware of any instances of
noncompliance which would have a material effect on the financial statements.
79
it
CITY OF FRIDLEY, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2012
E. Contingent Liability
The HRA entered into various limited tax increment revenue notes with developers whereby the
HRA shall pay the developers the lesser of the scheduled payment or available tax increment.
Whether a payment will occur, and if so, the amount of the payment(s) are uncertain since all
payments are dependent on the HRA receiving tax increments from the developer's project. As
such, this liability has not been recorded in the financial statements.
The HRA has issued various Tax Increment Revenue Notes. These notes are not a general
obligation of the HRA and are payable solely from available tax increments. Accordingly, these
notes are not reflected in the financial statements of the HRA. A schedule of outstanding notes at
December 31, 2012 is as follows:
Original Interest Maturity Outstanding
Note Principal Rate Date Balance 12/31/12
Medtronic $10,000,000 6.75% August 1, 2025 $7,214,551
TIF#19 1,500,000 7.00% February 1, 2025 1,519,439
F. Construction Commitments
At December 31, 2012, the City had construction project contracts in progress. The commitments
related to the remaining contract balances amounted to$0.
13. Leases
A. Lease Expense
The City leases space for one of its liquor stores. Total costs for this lease was$109,697 for the
year ended December 31, 2012. The future minimum lease payments for this lease are as
follows:
Year Ending
December 31, Amount
2013 $112,780
2014 126,778
2015 126,778
2016 126,778
2017 126,778
2018 105,649
Total $725,541
80
CITY OF FRIDLEY, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2012
B. Lease Revenue
The City receives revenue from agreements for the lease of space above its water towers to
communication companies. The space is used for antennas and other equipment necessary to
provide radio communications. For accounting purposes, the leases are considered operating
leases. Lease revenue for the year ended December 31, 2012, totaled $286,096. Terms of each
lease are as follows:
Annual
Lease
Adjustment Expiration Renewal
Lessee Factor* Date Options
T-Mobile-Commons Greater of 2%or CPI up to 5% 07/01/15 4 Five Year Renewals
T-Mobile Highway 65 Greater of 3% or CPI 12/31/16 1 Five Year Renewals
T-Mobile- Marion Hills Greater of 2% or CPI up to 5% 09/01/17 4 Five Year Renewals
AT&T-Garage Greater of 5%or CPI 12/01/13 4 Five Year Renewals
AT&T- Marion Hills Greater of 5% or CPI 06/30/15 3 Five Year Renewals
Sprint- Highway 65 Greater of 5%or CPI 09/30/15 3 Five Year Renewals
Crown Castle-Well#13 Greater of 5% or CPI 09/30/13 2 Five Year Renewals
ClearWire Legacy-Marion Hills Greater of 4% or CPI 08/01/15 4 Five Year Renewals
ClearWire Legacy-Hwy65 Greater of 4% or CPI 08/01/15 4 Five Year Renewals
ClearWire Legacy-Commons Greater of 4% or CPI 06/01/15 4 Five Year Renewals
TTM Operating Corp-Commons Greater of 3% or CPI 04/01/15 4 Five Year Renewals
TTM Operating Corp-Hwy65 Greater of 3%or CPI 08/01/15 4 Five Year Renewals
Metropolitan Council N/A 12/31/13 4 One Year Renewals
*Amounts for future lease receipts are unavailable because they are based on the
Consumer Price Index.
14. Conduit Debt Obligation
From time to time, the City has issued Industrial Revenue Bonds to provide financial assistance to
private-sector entities for the acquisition and construction of industrial and commercial facilities deemed
to be in the public interest. The bonds are secured by the property financed and are payable solely from
payments received on the underlying mortgage loans. Upon repayment of the bonds, ownership of the
acquired facilities transfers to the private-sector entity served by the bond issuance. Neither the City, the
State, nor any political subdivision thereof is obligated in any manner for repayment of the bonds.
Accordingly, the bonds are not reported as liabilities in the accompanying financial statements.
As of December 31, 2012, there were 30 series of Industrial Revenue Bonds issued. The aggregate
principal amount payable for the eight series issued after July 1, 1995 is $13,164,877. The aggregate
principal amount payable for the twenty-two series issued prior to July 1, 1995, could not be determined;
however, their original issue amounts totaled $65.2 million.
81
CITY OF FRIDLEY, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2012
15. Deficit Fund Balances
At December 31, 2012, individual funds with a deficit fund balance are as follows:
Primary government:
Non major Special Revenue Fund:
Police Activity $97,712
Component unit:
Lake Pointe 445,435
Gateway East 673,559
Gateway West 1,228,090
57th Avenue Redevelopment 48,954
TIF#19 3,395
Gateway NorthEast 1,146,290
16. Contingent Receivable
In 1999, the HRA entered into an agreement with Medtronic for the sale of land from the HRA to
Medtronic. The original principal amount of the receivable was $5,000,000 and the outstanding
balance at December 31, 2012 is $4,157,535. Interest is added quarterly at a rate of 8.25%.
Payments on the note receivable are made in an amount equal to 11.11% of tax increment note
payments received by Medtronic through 2012, and 22.22% of tax increment note payments
receivable from 2012 through 2026.
ICI
82
CITY OF FRIDLEY, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2012
17. Recently Issued Accounting Standards
The Governmental Accounting Standards Boards (GASB) recently approved the following
statements which were not implemented for these financial statements:
City
Implementation
Upcoming GASB Statements Required By
Statement No. 61 The Financial Reporting Omnibus—An amendment of 2013
GASB No. 14 and 34.
Statement No.65 Items Previously Reported as Assets and Liabilities 2013
(follow-up to GASB 63)
Statement No. 66 Technical Corrections—2012—An amendment of GASB 2013
Statements No. 10 and No. 62
Statement No. 67 Financial Reporting for Pension Plans—An amendment 2014
of GASB Statement No. 25.
Statement No. 68 Financial Reporting for Pensions—An amendment of 2015
GASB Statement No. 27.
Statement No. 69 Government Combinations and Disposal of Government 2014
Operations.
Statement No. 70 Financial Reporting for Nonexchange Financial 2014
Guarantees.
Statement No. 65 will introduce new Balance Sheet categories for deferred inflows and deferred
outflows (certain items previously reported as assets and liabilities).
Statement No. 68 (2015)will require for the first time the City to record a liability for its
proportionate share of the net pension liability of cost-sharing multi-employer pension plans (i.e.,
PERA).
83
f
CITY OF
FRIDLEY
84
REQUIRED SUPPLEMENTARY INFORMATION
85
Exhibit B-1
Page 1 of 4
CITY OF FRIDLEY, MINNESOTA
REQUIRED SUPPLEMENTARY INFORMATION
BUDGETARY COMPARISON SCHEDULE-GENERAL FUND
For The Year Ended December 31,2012
With comparative actual amounts for the year ended December 31,2011 1
2012
Variance with
Final Budget- 2011
Budgeted Amounts Actual Positive Actual
Original Final Amounts (Negative) Amounts
Revenues:
Taxes and special assessments:
Current ad valorem taxes $9,602,809 $9,602,809 $9,585,780 ($17,029) $8,940,975
Delinquent ad valorem taxes 101,000 101,000 22,530 (78,470) 87,654
Penalties and interest 20,500 20,500 33,184 12,684 29,250
Special assessments 42,200 42,200 39,851 (2,349) 29,577
Total taxes and special assessments 9,766,509 9,766,509 9,681,345 (85,164) 9,087,456
Licenses and permits:
Licenses:
Rental 150,000 150,000 163,495 13,495 158,185
Business 76,000 76,000 84,689 8,689 87,325
All other 29,000 29,000 33,540 4,540 34,055
Permits 457,150 457,150 570,252 113,102 567,827
Total licenses and permits 712,150 712,150 851,976 139,826 847,392
Intergovernmental revenue:
Federal grants 64,800 90,045 111,940 21,895 112,159
State maintenance aid 335,000 335,000 347,539 12,539 335,293
State credits 12,500 32,671 1,802 (30,869) 16,627
Local grants - 1,925 3,500 1,575 762,495
Other state grants - 2,668 25,842 23,174 1,852
Police and fire pension 404,282 404,282 384,155 (20,127) 393,942
Total intergovernmental revenue 816,582 866,591 874,778 8,187 1,622,368
Charges for services:
General government 1,374,750 1,374,750 1,411,283 36,533 1,328,853
Public safety 276,480 276,480 314,727 38,247 265,785
Public works 37,000 37,000 7,886 (29,114) 16,460
Community development 11,500 11,500 7,833 (3,667) 18,274
Recreation 226,400 226,400 230,347 3,947 202,911
Total charges for services 1,926,130 1,926,130 1,972,076 45,946 1,832,283
Fines and forfeits 175,000 175,000 170,427 (4,573) 165,314
Investment income 53,000 53,000 81,239 28,239 85,703
Miscellaneous revenue:
Insurance and other reimbursements 58,500 59,531 149,408 89,877 97,469
Gambling tax 50,000 50,000 61,124 11,124 55,582
Donations - 21,428 48,390 26,962 29,975
Miscellaneous 37,000 37,000 12,466 (24,534) 20,968
Total miscellaneous revenue 145,500 167,959 271,388 103,429 203,994
Total revenues 13,594,871 13,667,339 13,903,229 235,890 13,844,510
86
Exhibit B-1
Page 2 of 4
CITY OF FRIDLEY, MINNESOTA
REQUIRED SUPPLEMENTARY INFORMATION
BUDGETARY COMPARISON SCHEDULE-GENERAL FUND
For The Year Ended December 31,2012
With comparative actual amounts for the year ended December 31,2011
2012
Variance with
Final Budget- 2011
Budgeted Amounts Actual Positive Actual
Original Final Amounts (Negative) Amounts
Expenditures:
General government:
City management:
Mayor and council:
Current:
Personal services $95,444 $95,444 $92,558 $2,886 $88,151
Supplies and other charges 30,165 30,165 28,315 1,850 27,378
Total mayor and council 125,609 125,609 120,873 4,736 115,529
City manager:
Current:
Personal services 227,629 227,629 223,782 3,847 224,691
Supplies and other charges 55,660 55,660 61,418 (5,758) 50,894
Total city manager 283,289 283,289 285,200 (1,911) 275,585
Human resources:
Current:
Personal services 189,365 189,365 189,110 255 184,405
Supplies and other charges 15,770 15,770 9,571 6,199 11,612
Total human resources 205,135 205,135 198,681 6,454 196,017
Legal:
Current:
Supplies and other charges 417,490 417,490 402,952 14,538 383,841
Total city management 1,031,523 1,031,523 1,007,706 23,817 970,972
Finance:
Elections:
Current:
Personal services 1,976 1,976 38,402 (36,426) -
Supplies and other charges 41,224 41,224 3,882 37,342 14
Total elections 43,200 43,200 42,284 916 14
Accounting:
Current:
Personal services 617,798 617,798 608,573 9,225 600,489
Supplies and other charges 70,310 70,310 64,539 5,771 64,085
Total accounting 688,108 688,108 673,112 14,996 664,574
Assessing:
Current:
Personal services 202,511 202,511 184,335 18,176 167,623
Supplies and other charges 6,320 6,320 13,201 (6,881) 27,028
Total assessing 208,831 208,831 197,536 11,295 194,651
MIS:
Current:
Personal services 210,275 210,275 210,856 (581) 206,453
Supplies and other charges 60,364 60,364 57,274 3,090 14,970
Total MIS 270,639 270,639 268,130 2,509 221,423
City clerk/records:
Personal services 137,802 137,802 138,552 (750) 130,390
Supplies and other charges 19,919 19,919 19,886 33 17,630
Total city clerk/records 157,721 157,721 158,438 (717) 148,020
Total finance 1,368,499 1,368,499 1,339,500 28,999 1,228,682
Nondepartmental:
Current:
Personal services 10,000 10,000 10,966 (966) 10,685
Supplies and other charges 25,100 25,100 15,569 9,531 18,039
Total nondepartmental 35,100 35,100 26,535 8,565 28,724
' 87
Exhibit B-1
Page 3 of 4
CITY OF FRIDLEY,MINNESOTA
REQUIRED SUPPLEMENTARY INFORMATION
BUDGETARY COMPARISON SCHEDULE-GENERAL FUND
For The Year Ended December 31,2012
With comparative actual amounts for the year ended December 31,2011
2012
Variance with
Final Budget- 2011
Budgeted Amounts Actual Positive Actual
Original Final Amounts (Negative) Amounts
Expenditures: (continued)
General government: (continued)
Municipal center:
Current:
Personal services $39,827 $39,827 $22,619 $17,208 $22,775
Supplies and other charges 232,467 232,467 208,724 23,743 212,767
Total municipal center 272,294 272,294 231,343 40,951 235,542
Total general government 2,707,416 2,707,416 2,605,084 102,332 2,463,920
Public safety:
Police:
Police protection:
Current:
Personal services 4,652,928 4,678,721 4,578,675 100,046 4,379,972
Supplies and other charges 528,994 546,638 493,565 53,073 483,355
Captital outlay - - 5,467 (5,467) 118,429
Total police protection 5,181,922 5,225,359 5,077,707 147,652 4,981,756
Civil defense:
Current:
Supplies and other charges 18,935 19,835 17,544 2,291 21,914
Total police 5,200,857 5,245,194 5,095,251 149,943 5,003,670
Fire:
Fire protection:
Current:
Personal services 1,016,509 1,022,119 1,004,487 17,632 986,685
Supplies and other charges 172,202 176,265 165,817 10,448 179,537
Capital outlay - - - - 50,244
Total fire protection 1,188,711 1,198,384 1,170,304 28,080 1,216,466
Rental inspections:
Current:
Personal services 145,133 145,133 130,283 14,850 126,130
Supplies and other charges 14,272 14,272 8,096 6,176 5,804
Total rental inspections 159,405 159,405 138,379 21,026 131,934
Total fire 1,348,116 1,357,789 1,308,683 49,106 1,348,400
Total public safety 6,548,973 6,602,983 6,403,934 199,049 6,352,070
Public works:
Engineering:
Current:
Personal services 481,070 481,070 458,742 22,328 469,511
Supplies and other charges 58,246 58,246 66,566 (8,320) 55,005
Total engineering 539,316 539,316 525,308 14,008 524,516
Public works and parks:
Current:
Personal services 1,685,414 1,685,414 1,613,545 71,869 1,598,163
Supplies and other charges 1,010,581 1,010,581 871,084 139,497 932,722
Capital outlay - - 5,866 (5,866) 113,647
Total public works and parks 2,695,995 2,695,995 2,490,495 205,500 2,644,532
Total public works 3,235,311 3,235,311 3,015,803 219,508 3,169,048
88
Exhibit B-1
Page 4 of 4
CITY OF FRIDLEY,MINNESOTA
REQUIRED SUPPLEMENTARY INFORMATION
BUDGETARY COMPARISON SCHEDULE-GENERAL FUND
For The Year Ended December 31,2012
With comparative actual amounts for the year ended December 31,2011
2012
Variance with
Final Budget- 2011
Budgeted Amounts Actual Positive Actual
Original Final Amounts (Negative) Amounts
Expenditures: (continued)
Community development:
Building inspection:
Current:
Personal services 252,294 252,294 251,063 1,231 246,280
Supplies and other charges 68,643 68,643 74,470 (5,827) 62,626
Total building inspection 320,937 320,937 325,533 (4,596) 308,906
Planning:
Current:
Personal services $399,552 $399,552 $365,991 $33,561 $389,662
Supplies and other charges 52,401 52,401 80,546 (28,145) 40,148
Total planning 451,953 451,953 446,537 5,416 429,810
Total community development 772,890 772,890 772,070 820 738,716
Parks and recreation:
Current:
Personal services 610,099 610,099 565,830 44,269 555,968
Supplies and other charges 263,714 271,672 231,911 39,761 215,015
Capital outlay - 10,500 12,830 (2,330) -
Total parks and recreation 873,813 892,271 810,571 81,700 770,983
Contingency:
Current:
Supplies and other charges 120,000 120,000 - 120,000 -
Total expenditures 14,258,403 14,330,871 13,607,462 723,409 13,494,737
Excess(deficiency)of revenues over
(under)expenditures (663,532) (663,532) 295,767 959,299 349,773
Other financing sources:
Proceeds from sale of capital assets - - - - 15,096
Transfers in 600,000 600,000 600,000 - 623,467
Total other financing sources 600,000 600,000 600,000 0 638,563
Net change in fund balance ($63,532) ($63,532) 895,767 $959,299 988,336
Fund balance-January 1 6,773,555 5,785,219
Fund balance-December 31 $7,669,322 $6,773,555
89
1
i 1
- . 1
. _
__
-kik
I
CITY OF
FRIDLEY
90
CITY OF FRIDLEY, MINNESOTA
REQUIRED SUPPLEMENTARY INFORMATION
BUDGETARY COMPARISON SCHEDULE
NOTE TO RSI
December 31, 2012
A. BUDGETS
The General Fund budget is legally adopted on a basis consistent with accounting principles
generally accepted in the United States of America. The legal level of budgetary control is at the
expenditure category level.
91
CITY OF FRIDLEY, MINNESOTA
REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF FUNDING PROGRESS -RETIREE HEALTH PLAN
For The Year Ended December 31, 2012
Unfunded
Actuarial Actuarial UAAL as a
Actuarial Actuarial Accrued Accrued Funded Covered Percentage of
Valuation Value of Assets Liability (AAL)* Liability (UAAL) Ratio Payroll Covered Payroll
Date (a) (b) (b-a) (a/b) (c) ( (b-a)/c)
January 1, 2011 $ - $616,348 $616,348 0.0% $8,186,031 7.5%
January 1, 2008 $ - $1,910,670 $1,910,670 0.0% $9,303,576 20.5%
*Using the projected unit credit actuarial cost method.
Note, the first OPEB actuarial valuation was conducted as of January 1, 2008. There is no data available prior
to the first valuation.
92
COMBINED, COMBINING AND INDIVIDUAL FUND STATEMENTS AND
SCHEDULES
93
•
.
CITY OF
FRIDLFJY
94
NONMAJOR GOVERNMENTAL FUNDS
95
Exhibit C-1
CITY OF FRIDLEY, MINNESOTA
COMBINED BALANCE SHEET
NONMAJOR GOVERNMENTAL FUNDS
December 31, 2012
Total Nonmajor Governmental
Special Revenue Capital Project Funds
2012 2011
Assets
Cash and investments $1,787,332 $900,596 $2,687,928 $1,494,434
Receivables:
Accounts 93,165 - 93,165 116,793
Taxes 9,146 - 9,146 9,835
Due from other governments 17,371 - 17,371 32,537
Total assets $1,907,014 $900,596 $2,807,610 $1,653,599
Liabilities and Fund Balance
Liabilities:
Accounts payable $34,496 $7,313 $41,809 $27,003
Contracts payable 131,666 - 131,666
Due to other governments 147 - 147 373
Due to other funds 97,712 - 97,712 121,854
Salaries payable 19,425 - 19,425 19,044
Deferred revenue 133,827 - 133,827 7,880 1
Total liabilities 417,273 7,313 424,586 176,154
Fund balance:
Restricted 207,100 827,273 1,034,373 307,616
Committed 1,380,353 66,010 1,446,363 1,267,993
Assigned - - - -
Unassigned (97,712) - (97,712) (98,164)
Total fund balance 1,489,741 893,283 2,383,024 1,477,445
Total liabilities and fund balance $1,907,014 $900,596 $2,807,610 $1,653,599
I
96
Exhibit C-2
CITY OF FRIDLEY, MINNESOTA
COMBINED STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES
NONMAJOR GOVERNMENTAL FUNDS
For The Year Ended December 31, 2012
With comparative amounts for the year ended December 31, 2011
Special Capital Total Nonmajor
Revenue Project Governmental Funds
2012 2011
Revenues:
Taxes $318,168 $ - $318,168 $314,261
Licenses and permits 252,528 - 252,528 237,708
Intergovernmental revenue 174,828 - 174,828 86,172
Charges for services 362,479 - 362,479 370,395
Fines and forfeits 85,195 - 85,195 93,058
Investment income 15,534 2,565 18,099 19,625
Miscellaneous 50,216 - 50,216 _ 118,290
Total revenues 1,258,948 2,565 1,261,513 1,239,509
Expenditures:
Current:
General government 647,690 - 647,690 636,621
Public safety 28,308 - 28,308 101,261
Parks and recreation 418,518 - 418,518 397,564
Debt service - 33,581 33,581 -
Capital outlay 188,955 419,146 608,101 27,256
Total expenditures 1,283,471 452,727 1,736,198 1,162,702
Excess (deficiency) of revenues over(under) expenditures (24,523) (450,162) (474,685) 76,807
Other financing sources (uses):
Bonds issued - 1,280,000 1,280,000 -
Proceeds from sale of capital assets - 63,445 63,445 -
Transfers in 36,819 - 36,819 16,705
Transfers out - - - (23,467)
Total other financing sources(uses) 36,819 1,343,445 1,380,264 (6,762)
Net change in fund balance 12,296 893,283 905,579 70,045
Fund balance-January 1 1,477,445 - 1,477,445 1,407,400
Fund balance- December 31 $1,489,741 $893,283 $2,383,024 $1,477,445
97
CITY OF
FRIDLEY
98
NONMAJOR SPECIAL REVENUE FUNDS
Special Revenue Funds are used to account for revenues derived from specific taxes or other
earmarked revenue sources. They are usually required by statute, charter provision or local
ordinance to finance particular governmental functions or activities.
Cable TV Fund -This fund receives revenues from the issuance of a franchise agreement with
the cable TV provider. These revenues are used for the operation and maintenance of a
government access channel.
Grant Management Fund — This fund administers grants received from a variety of
intergovernmental agencies, which the amounts are restricted. In most cases, grant funds are
provided on a reimbursement basis following proper documentation of expenditures, however, in
some cases the money is provided in advance to spend on specific activities outlined in the
grant.
Solid Waste Abatement Fund - This fund receives grants, recycling fees and yard waste fees.
These revenues finance the City's curbside recycling pickup and operation of the yard waste
transfer site.
HRA Reimbursement Fund -This fund receives revenues from the Housing and
Redevelopment Authority. These revenues are used to reimburse the City for professional
services provided by City staff for HRA related activities.
Drug and Gambling Forfeiture Fund - This fund receives forfeited property in connection with
illegal gambling or drug activity. Pursuant to Minnesota Statutes, the proceeds are disbursed
between the investigating agency and the prosecuting agency.
F.C.C. Donations Fund - This fund is used to account for donations received and used in
improving and furnishing the Fridley Community Center.
Police Activity Fund - This fund is used to track the revenue and expenditures of externally
funded police positions.
Sprinqbrook Nature Center Fund - This fund was established in 2005 after a $275,000
referendum supporting the Springbrook Nature Center was approved by the voters in
November of 2004. The revenues from the annual levy are used for the on-going operation of
the nature center and the capital improvement projects required in the park.
99
CITY OF FRIDLEY, MINNESOTA
COMBINING BALANCE SHEET
NONMAJOR SPECIAL REVENUE FUNDS
December 31, 2012
Grant Solid Waste
Assets Cable TV Management Abatement
Cash and investments $1,375,597 $123,220 $44,136
Receivables:
Accounts 65,167 - 27,998
Taxes - - -
Due from other governments - 8,397 8,974
Total assets $1,440,764 $131,617 $81,108
Liabilities and Fund Balance
Liabilities:
Accounts payable $3,873 $651 $21,709
Contracts payable 131,666 - -
Due to other governments - - -
Due to other funds - - -
Salaries payable 2,959 3,772 2,009
Deferred revenue - 127,194 -
Total liabilities 138,498 131,617 23,718
Fund balance:
Restricted 72,640 - -
Committed 1,229,626 - 57,390
Unassigned - - -
Total fund balance 1,302,266 0 57,390
Total liabilities and fund balance $1,440,764 $131,617 $81,108
100
Exhibit C-3
Drug and Gambling Springbrook Nature
Forfeiture Police Activity Center Totals Nonmajor Special Revenue Funds
2012 2011
$131,285 $ - $113,094 $1,787,332 $1,494,434
- - - 93,165 116,793
- - 9,146 9,146 9,835
- - 17,371 32,537
$131,285 $0 $122,240 $1,907,014 $1,653,599
$3,359 $ - $4,904 $34,496 $27,003
- - - 131,666 -
- - 147 147 373
- 97,712 - 97,712 121,854
- - 10,685 19,425 19,044
- - 6,633 133,827 7,880
3,359 97,712 22,369 417,273 176,154
127,926 - 6,534 207,100 307,616
- - 93,337 1,380,353 1,267,993
(97,712) - (97,712) (98,164)
127,926 (97,712) 99,871 1,489,741 1,477,445
$131,285 $0 $122,240 $1,907,014 $1,653,599
101
CITY OF FRIDLEY, MINNESOTA
COMBINING STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
NONMAJOR SPECIAL REVENUE FUNDS
For The Year Ended December 31, 2012
With comparative totals for the year ended December 31, 2011
Grant Solid Waste
Cable TV Management Abatement
Revenues:
Taxes $ - $ - $ -
Licenses and permits 252,528 - -
Intergovernmental revenue - 107,426 65,550
Charges for services 711 - 271,805
Fines and forfeits - - -
Investment income 15,022 - -
Miscellaneous - 465 18,522
Total revenues 268,261 107,891 355,877
Expenditures:
Current:
General government 168,989 107,891 370,810
Public safety - - -
Parks and recreation - - -
Capital outlay 162,761 - -
Total expenditures 331,750 107,891 370,810
Excess (deficiency) of revenues
over(under) expenditures (63,489) 0 (14,933)
Other financing sources (uses):
Transfers in - - 36,819
Transfers out - - -
Total other financing sources (uses) 0 0 36,819
Net change in fund balance (63,489) 0 21,886
Fund balance-January 1,365,755
y -
35,504 i
Fund balance- December 31 $1,302,266 $0 $57,390
102
Exhibit C-4
Drug and
Gambling Springbrook
Forfeiture Police Activity Nature Center Totals Nonmajor Special Revenue Funds
2012 2011
$ - $ - $318,168 $318,168 $314,261
- - - 252,528 237,708
- - 1,852 174,828 86,172
- - 89,963 362,479 370,395
84,743 452 - 85,195 93,058
- - 512 15,534 19,625
- - 31,229 50,216 118,290
84,743 452 441,724 1,258,948 1,239,509
- - - 647,690 636,621
28,308 - - 28,308 101,261
- - 418,518 418,518 397,564
_ - - 26,194 188,955 27,256
28,308 0 444,712 1,283,471 1,162,702
56,435 452 (2,988) (24,523) 76,807
- - - 36,819 16,705
- - - - (23,467)
0 0 0 36,819 (6,762)
56,435 452 (2,988) 12,296 70,045
71,491 (98,164) 102,859 1,477,445 1,407,400
$127,926 ($97,712) $99,871 $1,489,741 $1,477,445
103
Exhibit D-1
CITY OF FRIDLEY, MINNESOTA
SPECIAL REVENUE FUND-CABLE TV FUND
COMPARATIVE BALANCE SHEET
December 31, 2012 and 2011
Assets 2012 2011
Cash and investments $1,375,597 $1,309,126
Accounts receivable 65,167 59,717
Total assets $1,440,764 $1,368,843
Liabilities and Fund Balance
Liabilities:
Accounts payable $3,873 $116
Contracts payable 131,666 -
Salaries payable 2,959 2,972
Total liabilities 138,498 3,088
Fund balance:
Restricted 72,640 236,125
Committed 1,229,626 1,129,630
Total fund balance 1,302,266 1,365,755
Total liabilities and fund balance $1,440,764 $1,368,843
104
Exhibit D-2
CITY OF FRIDLEY, MINNESOTA
SPECIAL REVENUE FUND -CABLE TV FUND
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE- BUDGET AND ACTUAL
For The Year Ended December 31, 2012
With comparative actual amounts for the year ended December 31, 2011
2012 2011
Budgeted Amounts Actual Actual
Original Final Amounts Amounts
Revenues:
Licenses-franchise fee $245,000 $245,000 $252,528 $237,708
Charges for services 850 850 711 700
Investment income 12,000 12,000 15,022 18,899
Miscellaneous 200 200 - -
Total revenues 258,050 258,050 268,261 257,307
Expenditures:
Current:
General government:
Personal services 142,294 142,294 141,508 137,123
Supplies and other charges 29,851 29,851 27,481 10,209
Capital outlay 170,000 170,000 162,761 9,476
Total expenditures 342,145 342,145 331,750 156,808
Excess (deficiency) of revenues over(under) expenditures ($84,095) ($84,095) (63,489) 100,499
Fund balance-January 1 1,365,755 1,265,256
Fund balance- December 31 $1,302,266 $1,365,755
105
Exhibit D-3
CITY OF FRIDLEY, MINNESOTA
SPECIAL REVENUE FUND -GRANT MANAGEMENT FUND
COMPARATIVE BALANCE SHEET
December 31, 2012 and 2011
Assets 2012 2011
Cash and investments $123,220 $179,521
Due from other governments 8,397 3,995
Total assets $131,617 $183,516
Liabilities and Fund Balance
Liabilities:
Accounts payable $651 $60
Salaries payable 3,772 3,382
Deferred revenue 127,194 180,074
Total liabilities 131,617 183,516
Fund balance:
Unassigned - -
Total fund balance 0 0
Total liabilities and fund balance $131,617 $183,516
106
Exhibit D-4
CITY OF FRIDLEY, MINNESOTA
REQUIRED SUPPLEMENTARY INFORMATION
BUDGETARY COMPARISON SCHEDULE -GRANT MANAGEMENT FUND
For The Year Ended December 31, 2012
With comparative actual amounts for the year ended December 31, 2011
2012
Variance with
Final Budget- 2011
Budgeted Amounts Actual Positive Actual
Original Final Amounts _ (Negative) Amounts
Revenues:
Intergovernmental:
Federal grants $104,890 $104,890 $99,222 ($5,668) $104,599
State grants - 2,999 8,204 5,205 135,727
Miscellaneous - - 465 4.65 -
Total revenues 104,890 107,889 107,891 2 240,326
Expenditures:
Current:
Community development:
Personal services 90,836 93,835 99,720 (5,885) 123,412
Supplies and other charges 14,054 14,054 8,171 5,883 116,914
Total expenditures 104,890 107,889 107,891 (2) 240,326
Excess (deficiency) of revenues over
(under) expenditures $0 $0 - $0 -
Fund balance-January 1 - -
Fund balance- December 31 $0 $0
107
Exhibit D-5
CITY OF FRIDLEY, MINNESOTA
SPECIAL REVENUE FUND -SOLID WASTE ABATEMENT FUND
COMPARATIVE BALANCE SHEET
December 31, 2012 and 2011
Assets 2012 2011
Cash and investments $44,136 $ -
Accounts receivable 27,998 $57,076
Due from other governments 8,974 32,357
Total assets $81,108 $89,433
Liabilities and Fund Balance
Liabilities:
Accounts payable $21,709 $24,492 '
Due to other governments - 73
Salaries payable 2,009 2,752
Due to other funds - 26,612
Total liabilities 23,718 53,929
Fund balance:
Committed 57,390 35,504
Total liabilities and fund balance $81,108 $89,433
108
Exhibit D-6
CITY OF FRIDLEY, MINNESOTA
SPECIAL REVENUE FUND -SOLID WASTE ABATEMENT FUND
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE -BUDGET AND ACTUAL
For The Year Ended December 31, 2012
With comparative actual amounts for the year ended December 31, 2011
2012 2011
Budgeted Amounts Actual Actual
Original Final Amounts Amounts
Revenues:
Intergovernmental revenue:
State $60,000 $60,000 $65,550 $66,241
Charges for services 279,562 279,562 271,805 267,406
Miscellaneous 42,000 42,000 18,522 104,833
Total revenues 381,562 381,562 355,877 438,480
Expenditures:
Current:
General government:
Personal services 73,667 73,667 39,133 66,712
Supplies and other charges 344,714 344,714 331,677 370,012
Total expenditures 418,381 418,381 370,810 436,724
Excess (deficiency) of revenues
over(under) expenditures (36,819) (36,819) (14,933) 1,756
Other financing sources:
Transfers in 36,819 36,819 36,819 16,705
Net change in fund balance $0 $0 21,886 18,461
Fund balance -January 1 35,504 17,043
Fund balance -December 31 $57,390 $35,504
109
Exhibit D-7
CITY OF FRIDLEY, MINNESOTA
SPECIAL REVENUE FUND -DRUG AND GAMBLING FORFEITURE FUND
COMPARATIVE BALANCE SHEET
December 31, 2012 and 2011
Assets 2012 2011
Cash and investments $131,285 $71,627
Accounts receivable - -
Due from other governments - -
Total assets $131,285 $71,627
Liabilities and Fund Balance
Liabilities $3,359 $136
Fund balance:
Restricted 127,926 71,491
Total fund balance 127,926 71,491
Total liabilities and fund balance $131,285 $71,627
110
Exhibit D-8
CITY OF FRIDLEY, MINNESOTA
SPECIAL REVENUE FUND -DRUG AND GAMBLING FORFEITURE FUND
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE -BUDGET AND ACTUAL
For The Year Ended December 31, 2012
With comparative actual amounts for the year ended December 31, 2011
2012 2011
Budgeted Amounts Actual Actual
Original Final Amounts Amounts
Revenues:
Fines and forfeits $ - $28,308 $84,743 $71,497
Expenditures:
Current:
Public safety
Personal services - 1,142 1,142 -
Supplies and other charges - 27,166 27,166 25,579
Total expenditures - 28,308 28,308 25,579
Excess (deficiency) of revenues
over(under) expenditures $0 $0 56,435 45,918
Fund balance-January 1 71,491 25,573
Fund balance- December 31 $127,926 $71,491
111
Exhibit D-9
CITY OF FRIDLEY, MINNESOTA
SPECIAL REVENUE FUND- POLICE ACTIVITY FUND
COMPARATIVE BALANCE SHEET
December 31,2012 and 2011
Assets 2012 2011
Due from other governments $ - $180
Total assets $0 $180
Liabilities and Fund Balance
Liabilities:
Salaries payable $ - $3,102
Due to other funds 97,712 95,242
Total liabilities 97,712 98,344
Fund balance:
Unassigned (97,712) (98,164)
Total liabilities and fund balance $0 $180
112
Exhibit D-10
CITY OF FRIDLEY, MINNESOTA
SPECIAL REVENUE FUND - POLICE ACTIVITY FUND
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE -BUDGET AND ACTUAL
For The Year Ended December 31, 2012
With comparative actual amounts for the year ended December 31, 2011
2012 2011
Budgeted Amounts Actual Actual
Original Final Amounts Amounts
Revenues:
Intergovernmental $ - $ - $ - $12,760
Fines and forfeits - - 452 21,561
Investment income - - - -
Total revenues 0 0 452 34,321
Expenditures
Current:
Public safety:
Personal services - - - 75,682
Excess (deficiency) of revenues
over(under) expenditures $0 $0 452 (41,361)
Fund balance (deficit)-January 1 (98,164) (56,803)
Fund balance (deficit) - December 31 ($97,712) ($98,164)
113
Exhibit D-11
CITY OF FRIDLEY, MINNESOTA
SPECIAL REVENUE FUND -SPRINGBROOK NATURE CENTER FUND
COMPARATIVE BALANCE SHEET
December 31, 2012 and 2011
Assets 2012
2011
Cash and investments $113,094 $113,681
Receivables:
Taxes 9,146 9,835
Due from other governments - -
Total assets $122,240 $123,516
Liabilities and Fund Balance
I
Liabilities:
Accounts payable $4,904 $2,395
Due to other governments 147 164
Salaries payable 10,685 10,218
Deferred revenue 6,633 7,880
Total liabilities 22,369 20,657
Fund balance:
Restricted 3,546 -
Committed 96,325 102,859
Total fund balance 99,871 102,859
Total liabilities and fund balance $122,240 $123,516
114
Exhibit D-12
CITY OF FRIDLEY, MINNESOTA
SPECIAL REVENUE FUND -SPRINGBROOK NATURE CENTER FUND
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE -BUDGET AND ACTUAL
For The Year Ended December 31, 2012
With comparative actual amounts for the year ended December 31, 2011
2012 2011
Budgeted Amounts Actual Actual
Original Final Amounts Amounts
Revenues:
Taxes $320,200 $320,200 $318,168 $314,261
Intergovernmental revenue:
Local grant - 1,852 1,852 -
Charges for service 91,900 91,900 89,963 102,289
Investment income - - 512 623
Miscellaneous - 31,229 31,229 13,457
Total revenues 412,100 445,181 441,724 430,630
Expenditures:
Current:
Parks, recreation and naturalist
Personal services 329,543 333,010 343,376 328,435
Supplies and other charges 76,055 90,533 75,142 69,129
Capital outlay - 26,194 26,194 17,780
Total expenditures 405,598 449,737 444,712 415,344
Excess (deficiency) of revenues
over(under)expenditures $6,502 ($4,556) (2,988) 15,286
Fund balance-January 1 102,859 87,573
Fund balance- December 31 $99,871 $102,859
115
F
CITY OF
FRIDLEY
116
NONMAJOR CAPITAL PROJECT FUND
The Capital Equipment Fund - is used to account for the purchase and repair of
major capital equipment.
MAJOR CAPITAL PROJECT FUND
The Capital Improvement Fund - is established to provide special accounting for
bond proceeds, grants and contributions designated for the acquisition of capital
assets.
117
Exhibit E-1
CITY OF FRIDLEY, MINNESOTA
CAPITAL PROJECT FUND -CAPITAL EQUIPMENT
COMPARATIVE BALANCE SHEET
December 31, 2012 and 2011
Assets 2012 2011
Cash and investments $900,596 $ -
Total assets $900,596 $0
Liabilities and Fund Balance
Liabilities:
Accounts payable $7,313 $ -
Total liabilities 7,313 0
Fund balance:
Restricted 827,273
Committed 66,010
Assigned - -
Total fund balance 893,283
Total liabilities and fund balance $900,596 $0
118
Exhibit E-2
CITY OF FRIDLEY, MINNESOTA
CAPITAL PROJECT FUND-CAPITAL EQUIPMENT
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE -BUDGET AND ACTUAL
For The Year Ended December 31, 2012
With comparative actual amounts for the year ended December 31, 2011
2012 2011
Budgeted Amounts Actual Actual
Original Final Amounts Amounts
Revenues:
Investment income $ - $ - $2,565 $ -
Total revenues 0 0 2,565 0
Expenditures:
Debt service - - 33,581 -
Capital outlay 424,400 452,727 419,146 -
Total expenditures 424,400 452,727 452,727 0
Excess(deficiency) of revenues over(under) expenditures (424,400) (452,727) (450,162) 0
Other financing sources (uses):
Bonds issued 1,246,300 1,246,300 1,280,000
-
Proceeds from sale of capital assets - - 63,445 0
Total other financing sources (uses) 1,246,300 1,246,300 1,343,445 -
Net change in fund balance $821,900 $793,573 893,283 0
Fund balance-January 1 - -
Fund balance- December 31 $893,283 $ -
119
Exhibit E-3
CITY OF FRIDLEY, MINNESOTA
CAPITAL PROJECT FUND -CAPITAL IMPROVEMENT FUND
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE -BUDGET AND ACTUAL
For The Year Ended December 31, 2012
With comparative actual amounts for the year ended December 31, 2011
2012 2011
Budgeted Amounts Actual Actual
Original Final Amounts Amounts
Revenues:
Taxes $ - $ - $76 $190
Special assessments - - 51,888 135,848
Intergovernmental revenue:
State 1,439,414 1,439,414 1,599,601 476,071
Investment income 51,325 51,325 59,295 79,563
Miscellaneous 10,000 10,000 750 3,000
Total revenues 1,500,739 1,500,739 1,711,610 694,672
Expenditures:
Current:
General government:
Supplies and other charges - - 49,364 8,166
Parks and recreation:
Supplies and other charges 4,000 77,143 35,830 26,863
Capital outlay 555,000 380,000 280,261 71,710
Total expenditures 559,000 457,143 365,455 106,739
Excess of revenues over expenditures 941,739 1,043,596 1,346,155 587,933
Other financing sources (uses):
Transfers out (870,000) (870,000) (870,000) (610,000)
Transfers in - 30,000
Total other financing sources (uses) (870,000) (870,000) (870,000) (580,000)
Net change in fund balance $71,739 $173,596 476,155 7,933
Fund balance -January 1 5,264,318 5,256,385
Fund balance- December 31 $5,740,473 $5,264,318
II
120
INTERNAL SERVICE FUNDS
Internal Service Funds are used to account for goods and services that are
provided on a cost reimbursement or fee basis to departments or agencies within
the City. These funds are essential for segregating costs for determining the
total cost of providing a service and for assuring that the goods and services
provided are properly utilized. These funds are accounted for on a capital
maintenance measurement focus and use the accrual basis of accounting.
Employee Benefits Fund — This fund is used to account for the expenses
associated with providing fringe benefits for employees.
Self-Insurance Fund — This fund is used to account for all revenues and
expenses associated with the $50,000 deductible in the City's general liability
policy.
Information Systems Fund — This fund is used to account for all revenues and
expenses associated with maintaining and upgrading the City's computerized
information systems.
121
Exhibit F-1
CITY OF FRIDLEY, MINNESOTA
COMBINING STATEMENT OF NET POSITION
INTERNAL SERVICE FUNDS
December 31, 2012
With comparative totals for December 31, 2011
Employee Self Information
Benefits Insurance Systems Totals
Assets: 2012 2011
Current assets:
Cash and investments $1,244,114 $1,458,079 $376,841 $3,079,034 $3,261,173
Due from component unit 69 - - 69 92
Total current assets 1,244,183 1,458,079 376,841 3,079,103 3,261,265
Capital assets, at cost:
Machinery and equipment - - 1,462,918 1,462,918 1,706,407
Less: accumulated depreciation - - (1,111,685) (1,111,685) (1,415,636)
Net capital assets 0 0 351,233 351,233 290,771
Total assets 1,244,183 1,458,079 728,074 3,430,336 3,552,036
Liabilities:
Current liabilities:
Accounts payable - 2,420 771 3,191 4,941
Due to component unit - - - - 3,345
Payroll deductions payable 95,215 - - 95,215 100,894
Compensated absences payable-
current portion 763,779 - - 763,779 767,935
Total current liabilities 858,994 2,420 771 862,185 877,115
Noncurrent liabilities:
Compensated absences payable 203,972 - - 203,972 228,771
Total liabilities 1,062,966 2,420 771 1,066,157 1,105,886
Net position:
Net investment in capital assets - - 351,233 351,233 290,771
Unrestricted 181,217 1,455,659 376,070 2,012,946 2,155,379
Total net position $181,217 $1,455,659 $727,303 $2,364,179 $2,446,150
122
Exhibit F-2
CITY OF FRIDLEY, MINNESOTA
COMBINING STATEMENT OF REVENUES,EXPENSES AND
CHANGES IN NET POSITION
INTERNAL SERVICE FUNDS
For The Year Ended December 31, 2012
With comparative totals for the year ended December 31,2011
Employee Self Information Intra-Activity
Benefits Insurance Systems Eliminations Totals
2012 2011
Operating revenues:
Charges for services $21,410 $196,889 $73,560 $ - $291,859 $29,402
Operating expenses:
Personal services 22,869 26,541 - - 49,410 47,631
Supplies and other charges 1,700 217,687 12,489 - 231,876 83,928
Depreciation - - 136,123 - 136,123 131,900
Total operating expenses 24,569 244,228 148,612 0 417,409 263,459
Operating income(loss) (3,159) (47,339) (75,052) 0 (125,550) (234,057)
Nonoperating revenues:
Investment income 13,783 15,034 4,197 - 33,014 49,894
Intergovernmental - 10,365 - - 10,365 9,943
Insurance reimbursement - 200 - - 200 12,729
Gain(loss)on disposal of capital assets - - - - - (159)
Total nonoperating revenues 13,783 25,599 4,197 0 43,579 72,407
Income(loss) before transfers 10,624 (21,740) (70,855) 0 (81,971) (161,650)
Other financing sources(uses):
Transfers in - - 59,000 (59,000) - -
Transfers out (59,000) - - 59,000 - (30,000)
Total other financing sources(uses) (59,000) - 59,000 - - (30,000)
Change in net position (48,376) (21,740) (11,855) 0 (81,971) (191,650)
Net position-January 1 229,593 1,477,399 739,158 - 2,446,150 2,637,800
Net position-December 31 $181,217 $1,455,659 $727,303 $0 $2,364,179 $2,446,150
123
Exhibit F-3
CITY OF FRIDLEY, MINNESOTA
COMBINING STATEMENT OF CASH FLOWS
INTERNAL SERVICE FUNDS
For The Year Ended December 31, 2012
With comparative totals for the year ended December 31, 2011
Employee Self Information
Benefits Insurance Systems Totals
2012 2011
Cash flows from operating activities:
Receipts from interfund services provided $21,433 $196,889 $73,560 $291,882 $29,448
Payment to suppliers (1,700) (218,612) (16,659) (236,971) (77,144)
Payment to employees (57,503) (26,541) - (84,044) (19,079)
Net cash flows from operating activities (37,770) (48,264) 56,901 (29,133) (66,775)
Cash flows from noncapital financing activities:
Transfer in - 59,000 59,000
Transfer out (59,000) - - (59,000) (30,000)
Net cash flows from
noncapital financing activties (59,000) 0 59,000 0 (30,000)
Cash flows from capital and related
financing activities:
Acquisition of capital assets - - (196,585) (196,585) (144,266)
Intergovernmental revenue - 10,365 - 10,365 9,943
Insurance reimbursement - 200 - 200 12,729
Proceeds from sale of capital assets - - - - -
Net cash flows from capital and
and related financing activities 0 10,565 (196,585) (186,020) (121,594)
Cash flows from investing activities:
Investment income 13,783 15,034 4,197 33,014 49,894
Net increase (decrease) in cash and
cash equivalents (82,987) (22,665) (76,487) (182,139) (168,475)
Cash and cash equivalents-January 1 1,327,101 1,480,744 453,328 3,261,173 3,429,648
Cash and cash equivalents- December 31 $1,244,114 $1,458,079 $376,841 $3,079,034 $3,261,173
Reconciliation of operating income(loss)to net
cash provided (used) by operating activities:
Operating income (loss) ($3,159) ($47,339) ($75,052) ($125,550) ($234,057)
Adjustments to reconcile operating income
(loss)to net cash flows from operating
activities:
Depreciation - - 136,123 136,123 131,900
Changes in assets and liabilities:
Decrease (increase) in receivables 23 - - 23 46
Increase (decrease) in payables (34,634) (925) (4,170) (39,729) 35,336
Total adjustments (34,611) (925) 131,953 96,417 167,282
Net cash provided by operating activities ($37,770) ($48,264) $56,901 ($29,133) ($66,775)
124
Exhibit F-4
CITY OF FRIDLEY, MINNESOTA
INTERNAL SERVICE FUND - EMPLOYEE BENEFITS FUND
COMPARATIVE STATEMENT OF NET POSITION
December 31, 2012
With comparative totals for December 31, 2011
2012 2011
Assets:
Current assets:
Cash and investments $1,244,114 $1,327,101
Due from component unit 69 92
Total current assets 1,244,183 1,327,193
Liabilities:
Current liabilities:
Payroll deductions payable 95,215 100,894
Compensated absences payable -current portion 763,779 767,935
Total current liabilities 858,994 868,829
Noncurrent liabilities:
Compensated absences payable 203,972 228,771
Total liabilities 1,062,966 1,097,600
Net position:
Unrestricted 181,217 229,593
Total net position $181,217 $229,593
125
Exhibit F-5
CITY OF FRIDLEY, MINNESOTA
INTERNAL SERVICE FUND -EMPLOYEE BENEFITS FUND
COMPARATIVE STATEMENT OF REVENUES, EXPENSES AND
CHANGES IN NET POSITION
For The Year Ended December 31, 2012
With comparative amounts for the year ended December 31, 2011
2012 2011
Operating revenues $21,410 $24,483
Operating expenses:
Personal services 22,869 24,483
Supplies and other charges 1,700 3,644
Total operating expenses 24,569 28,127
Operating income(loss) (3,159) (3,644)
Nonoperating revenues:
Investment income 13,783 19,205
Income before transfers 10,624 15,561
Other financing uses:
Transfers out (59,000) -
Change in net position (48,376) 15,561
Net position -January 1 229,593 214,032
Net position - December 31 $181,217 $229,593
126
Exhibit F-6
CITY OF FRIDLEY, MINNESOTA
INTERNAL SERVICE FUND - EMPLOYEE BENEFITS FUND
COMPARATIVE STATEMENT OF CASH FLOWS
For The Year Ended December 31, 2012
With comparative amounts for the year ended December 31, 2011
2012 2011
Cash flows from operating activities:
Receipts from interfund services provided $21,433 $24,529
Payment to suppliers (1,700) (3,644)
Payment to employees (57,503) 4,069
Net cash flows from operating activities (37,770) 24,954
Cash flows from noncapital financing activities:
Transfer out (59,000) -
Cash flows from investing activities:
Investment income 13,783 19,205
Net increase in cash and cash equivalents (82,987) 44,159
Cash and cash equivalents-January 1 1,327,101 1,282,942
Cash and cash equivalents- December 31 $1,244,114 $1,327,101
Reconciliation of operating income (loss) to net cash
provided (used) by operating activities:
Operating income (loss) ($3,159) ($3,644)
Adjustments to reconcile operating income (loss)
to net cash flows from operating activities:
Changes in assets and liabilities:
(Increase) decrease in receivables 23 46
Increase (decrease) in payables (34,634) 28,552
Total adjustments (34,611) 28,598
Net cash provided by operating activities ($37,770) $24,954
127
Exhibit F-7
CITY OF FRIDLEY, MINNESOTA
INTERNAL SERVICE FUND -SELF INSURANCE FUND
COMPARATIVE STATEMENT OF NET POSITION
December 31, 2012
With comparative amounts for December 31, 2011
2012 2011
Assets:
Current assets:
Cash and investments $1,458,079 $1,480,744
Total assets 1,458,079 1,480,744
Liabilities:
Current liabilities:
Accounts payable 2,420 3,345
Net position:
Unrestricted 1,455,659 1,477,399
Total net position $1,455,659 $1,477,399
128
Exhibit F-8
CITY OF FRIDLEY, MINNESOTA
INTERNAL SERVICE FUND -SELF INSURANCE FUND
COMPARATIVE STATEMENT OF REVENUES, EXPENSES AND
CHANGES IN NET POSITION
For The Year Ended December 31, 2012
With comparative amounts for the year ended December 31, 2011
2012 2011
Operating revenues:
Charges for services $196,889 $ -
Operating expenses:
Supplies and other charges 217,687 43,095
Personal services 26,541 23,148
Total operating expenses 244,228 66,243
Operating income (loss) (47,339) (66,243)
Nonoperating revenues (expenses):
Intergovernmental 10,365 9,943
Investment income 15,034 22,764
Insurance reimbursement 200 12,729
Total nonoperating revenues (expenses) 25,599 45,436
Income before transfers (21,740) (20,807)
Other financing uses:
Transfers out - (30,000)
Change in net position (21,740) (50,807)
Net position -January 1 1,477,399 1,528,206
Net position - December 31 $1,455,659 $1,477,399
129
Exhibit F-9
CITY OF FRIDLEY, MINNESOTA
INTERNAL SERVICE FUND -SELF INSURANCE FUND
COMPARATIVE STATEMENT OF CASH FLOWS
For The Year Ended December 31, 2012
With comparative amounts for the year ended December 31, 2011
2012 2011
Cash flows from operating activities:
Receipts from interfund services provided $196,889 $ -
Payment to suppliers (218,612) (41,252)
Payment to employees (26,541) (23,148)
Net cash flows from operating activities (48,264) (64,400)
Cash flows from noncapital financing activities:
Transfer out - (30,000)
Cash flows from capital and related financing activities:
Intergovernmental revenue 10,365 9,943
Insurance reimbursement 200 12,729
Net cash flows provided from capital and related financing activities 10,565 22,672
Cash flows from investing activities:
Investment income 15,034 22,764
Net increase (decrease) in cash and cash equivalents (22,665) (48,964)
Cash and cash equivalents-January 1 1,480,744 1,529,708
Cash and cash equivalents - December 31 $1,458,079 $1,480,744
Reconciliation of operating income(loss)to net cash
provided (used) by operating activities:
Operating income (loss) ($47,339) ($66,243)
Adjustments to reconcile operating income (loss)
to net cash flows from operating activities:
Changes in assets and liabilities:
Increase (decrease) in payables (925) 1,843
Total adjustments (925) 1,843
Net cash provided (used) by operating activities ($48,264) ($64,400)
130
Exhibit F-10
CITY OF FRIDLEY, MINNESOTA
INTERNAL SERVICE FUND - INFORMATION SYSTEMS FUND
COMPARATIVE STATEMENT OF NET POSITION
December 31, 2012
With comparative amounts for December 31, 2011
2012 2011
Assets:
Current assets:
Cash and investments $376,841 $453,328
Capital assets, at cost:
Property and equipment 1,462,918 1,706,407
Less: accumulated depreciation (1,111,685) (1,415,636)
Net capital assets 351,233 290,771
Total assets 728,074 744,099
Liabilities:
Current liabilities:
Accounts payable 771 4,941
Net position:
Net investment in capital assets 351,233 290,771
Unrestricted 376,070 448,387
Total net position $727,303 $739,158
131
Exhibit F-11
CITY OF FRIDLEY, MINNESOTA
INTERNAL SERVICE FUND -INFORMATION SYSTEMS FUND
COMPARATIVE STATEMENT OF REVENUES, EXPENSES AND
CHANGES IN NET POSITION
For The Year Ended December 31, 2012
With comparative amounts for the year ended December 31, 2011
2012 2011
Operating revenues:
Charges for services $73,560 $4,919
Operating expenses:
Supplies and other charges 12,489 37,189
Depreciation 136,123 131,900
Total operating expenses 148,612 169,089
Operating income (loss) (75,052) (164,170)
Nonoperating revenues:
Investment income 4,197 7,925
Gain (loss) on disposal of fixed assets - (159)
Total nonoperating revenues 4,197 7,766
Income before transfers (70,855) (156,404)
Other financing uses:
Transfers in 59,000 -
Change in net position (11,855) (156,404)
Net position -January 1 739,158 895,562
Net position - December 31 $727,303 $739,158
132
Exhibit F-12
CITY OF FRIDLEY, MINNESOTA
INTERNAL SERVICE FUND -INFORMATION SYSTEMS FUND
COMPARATIVE STATEMENT OF CASH FLOWS
For The Year Ended December 31, 2012
With comparative amounts for the year ended December 31, 2011
2012 2011
Cash flows from operating activities:
Receipts from interfund services provided $73,560 $4,919
Payment to suppliers (16,659) (32,248)
Net cash flows from operating activities 56,901 (27,329)
Cash flows from noncapital financing activities:
Transfer in 59,000 -
Cash flows from capital and related
financing activities:
Acquisition of capital assets (196,585) (144,266)
Proceeds from sale of capital assets - -
Net cash flows from capital
and related financing activities (196,585) (144,266)
Cash flows from investing activities:
Investment income 4,197 7,925
Net increase in cash and cash equivalents (76,487) (163,670)
Cash and cash equivalents -January 1 453,328 616,998
Cash and cash equivalents - December 31 $376,841 $453,328
Reconciliation of operating income (loss)to net cash
provided (used) by operating activities:
Operating income (loss) ($75,052) ($164,170)
Adjustments to reconcile operating income (loss)
to net cash flows from operating activities:
Depreciation 136,123 131,900
Changes in assets and liabilities:
Increase (decrease) in payables (4,170) 4,941
Total adjustments 131,953 136,841
Net cash provided by operating activities $56,901 - ($27,329)
133
E
T
CITY OF
FRIDLEY
134
HOUSING AND REDEVELOPMENT AUTHORITY
COMPONENT UNIT
135
CITY OF FRIDLEY, MINNESOTA
BALANCE SHEET-GOVERNMENTAL FUNDS
HOUSING AND REDEVELOPMENT AUTHORITY
December 31, 2012
General Housing Loan Center City
Assets
Cash and investments $3,801,869 $2,853,960 $12,897
Receivables:
Accounts 72,020 - -
Delinquent taxes 10,293 - -
Mortgage:
Deferred - 1,109,620 -
Allowance for uncollectible accounts - (57,959) -
Interest 71,390 - -
Due from other funds 4,508,825 - -
Prepaid expenses - 3,914 -
Land held for resale 2,499,615 - -
Total assets $10,964,012 $3,909,535 $12,897
Liabilities and Fund Balance
Liabilities:
Accounts payable $ - $ - $ -
Due to primary government 62,255 - -
Due to other funds - - -
Deferred revenue 2,509,908 - -
Total liabilities 2,572,163 0 0
Fund balance (deficit):
Nonspendable - 1,055,575 -
Restricted - - 12,897
Committed - 2,853,960 -
Assigned - - -
Unassigned 8,391,849 - -
Total fund balance (deficit) 8,391,849 3,909,535 12,897
Total liabilities and fund balance $10,964,012 $3,909,535 $12,897
136
Exhibit G-1
Other
North Area/ Gateway Governmental
Univ. Ind. Park Lake Pointe Onan West Funds Totals Governmental Funds
2012 2011
$33,710 $333,991 $1,593,440 $42,019 $1,365,048 $10,036,934 $9,018,618
- - - - - 72,020 46,687
- 2,032 3,552 1,110 2,414 19,401 31,754
- - - - - 1,109,620 1,119,159
- - - - - (57,959) (57,959)
- - - - - 71,390 44,656
- - - - - 4,508,825 5,379,825
- - - - - 3,914 4,399
- 64,800 - 219,420 594,720 3,378,555 3,599,305
$33,710 $400,823 $1,596,992 $262,549 $1,962,182 $19,142,700 $19,186,444
$ - $324,123 $ - $ - $51,862 $375,985 $496,928
- - - - - 62,255 9,443
- 455,303 - 1,270,109 2,783,413 4,508,825 5,379,825
- 66,832 3,552 220,530 597,134 3,397,956 3,631,059
0 846,258 3,552 1,490,639 3,432,409 8,345,021 9,517,255
- - - - - 1,055,575 1,065,599
33,710 - 1,593,440 - 401,971 2,042,018 1,611,471
- - - - - 2,853,960 2,793,420
(445,435) - (1,228,090) (1,872,198) 4,846,126 4,198,699
33,710 (445,435) 1,593,440 (1,228,090) (1,470,227) 10,797,679 9,669,189
$33,710 $400,823 $1,596,992 $262,549 $1,962,182 $19,142,700 $19,186,444
Fund balance reported above $10,797,679 $9,669,189
Amounts reported for governmental activities in the statement of net
position are different because:
Capital assets used in governmental activities are not financial
resources, and therefore, are not reported in the funds 2,023,511 2,023,511
Other long-term assets are not available to pay for current-period
expenditures and, therefore, are deferred in the funds 3,397,956 3,631,059
Net position of governmental activities $16,219,146 $15,323,759
137
CITY OF FRIDLEY, MINNESOTA
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
GOVERNMENTAL FUNDS
HOUSING AND REDEVELOPMENT AUTHORITY
For The Year Ended December 31, 2012
With comparative totals for the year ended December 31, 2011
North Area/
Univ. Ind.
General Housing Loan Center City Park
Revenues:
Tax increment $ - $ - $ - $ -
Property taxes 428,756 - - -
Intergovernmental revenue - - - -
Investment income 21,946 18,138 - -
Mortgage interest earnings - 45,021 - -
Rental 9,600 - - -
Sale of real estate 144,324 - - -
Miscellaneous 182,171 18,544 - -
Total revenues 786,797 81,703 0 0
Expenditures:
Personal services 118,337 - - -
Supplies and other charges 329,124 31,187 - -
Capital outlay 16,695 - - -
Developer assistance - - - -
Total expenditures 464,156 31,187 0 0
Excess (deficiency) of revenues over
(under)expenditures 322,641 50,516 0 0
Other financing sources:
Transfer in - - - -
Transfer out - - - -
Total other financing sources (uses) 0 0 0 0
Net change in fund balance 322,641 50,516 - -
Fund balance (deficit) -January 1 8,069,208 3,859,019 12,897 33,710
Fund balance (deficit)- December 31 $8,391,849 $3,909,535 $12,897 $33,710
138
Exhibit G-2
Other
Governmental Intra-Activity
Lake Pointe Onan Gateway West Funds Elminations Totals Governmental Funds
2012 2011
$717,826 $348,740 $7,035 $414,933 $ - $1,488,534 $1,736,412
- - - - - 428,756 450,404
- - - - 34,603
3,234 9,184 799 7,567 - 60,868 87,672
- - - 45,021 47,074
- - - - - 9,600 9,600
- - 19,649 268,849 - 432,822 604,292
- - - - - 200,715 409,046
721,060 357,924 27,483 691,349 0 2,666,316 3,379,103
- - - - - 118,337 115,577
72,230 34,823 5,343 83,696 - 556,403 1,014,821
- - - 98,237 - 114,932 257,457
645,022 - - 103,132 - 748,154 939,845
717,252 34,823 5,343 285,065 0 1,537,826 2,327,700
3,808 323,101 22,140 406,284 0 1,128,490 1,051,403
- - 262,907 - (262,907) - -
- - - (262,907) 262,907 - -
0 0 262,907 (262,907) 0 0 0
3,808 323,101 285,047 143,377 - 1,128,490 1,051,403
(449,243) 1,270,339 (1,513,137) (1,613,604) - 9,669,189 8,617,786
($445,435) $1,593,440 ($1,228,090) ($1,470,227) $0 $10,797,679 $9,669,189
Amounts reported for governmental activities in the statement of activities
(Exhibit A-2)are different because:
Net changes in fund balances -total above $1,128,490 $1,051,403
Revenues in the statement of activities that do not provide current financial
resources are not reported as revenues in the funds. (233,103) (682,656)
Changes in net position of governmental activities (Exhibit A-2) $895,387 $368,747
139
CITY OF FRIDLEY, MINNESOTA
SUBCOMBINING BALANCE SHEET
NONMAJOR CAPITAL PROJECT FUNDS
HOUSING AND REDEVELOPMENT AUTHORITY
December 31, 2012
With comparative totals for December 31, 2011
University/ McGlynn
Gateway East Osborne Bakeries
Assets
Cash and investments $6,094 $146,611 $45,694
Delinquent taxes receivable - 179 -
Land held for resale - - -
Total assets $6,094 $146,790 $45,694
Liabilities and Fund Balance
Liabilities:
Accounts payable $ - $ - $ -
Due to other funds 679,653 - -
Deferred revenue - 179 -
Total liabilities 679,653 179 0
Fund balance (deficit):
Restricted - 146,611 45,694
Unassigned (673,559) -Total fund balance (deficit) (673,559) 146,611 45,694
Total liabilities and fund balance $6,094 $146,790 $45,694
140
Exhibit G-3
Housing
Satellite Lane 57th Avenue Replacement Gateway Total Nonmajor Capital Project
Apts. Redevelopment TIF#19 #1 NorthEast Funds
2012 2011
$37,409 $4,806 $48,142 $772,257 $304,035 $1,365,048 $1,514,599
810 104 465 856 - 2,414 1,022
- - - 334,800 259,920 594,720 789,100
$38,219 $4,910 $48,607 $1,107,913 $563,955 $1,962,182 $2,304,721
$ - $ - $51,537 $ - $325 $51,862 $53,790
- 53,760 - 600,000 1,450,000 2,783,413 3,074,413
810 104 465 335,656 259,920 597,134 790,122
810 53,864 52,002 935,656 1,710,245 3,432,409 3,918,325
37,409 - - 172,257 - 401,971 294,525
- (48,954) (3,395) - (1,146,290) (1,872,198) (1,908,129)
37,409 (48,954) (3,395) 172,257 (1,146,290) (1,470,227) (1,613,604)
$38,219 $4,910 $48,607 $1,107,913 $563,955 $1,962,182 $2,304,721
141
CITY OF FRIDLEY, MINNESOTA
SUBCOMBINING STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCE
NONMAJOR CAPITAL PROJECT FUNDS
HOUSING AND REDEVELOPMENT AUTHORITY
For The Year Ended December 31, 2012
With comparative totals for the year ended December 31, 2011
University/ McGlynn
Winfield Gateway East Osborne Bakeries
Revenues:
Tax increment $77,223 $28,090 $60,501 $39,671
Intergovernmental revenue - - - -
Investment income - 182 763 255
Sale of real estate - - - -
Total revenues 77,223 28,272 61,264 39,926
Expenditures:
Supplies and other charges 7,713 2,870 6,046 3,967
Developer assistance - - - -
Capital outlay - - - -
Total expenditures 7,713 2,870 6,046 3,967
Excess (deficiency) of
revenues over(under) expenditures 69,510 25,402 55,218 35,959
1
1
Other financing sources:
Transfers out (262,907) - - -
i
Net change in fund balance (193,397) 25,402 55,218 35,959
Fund balance (deficit) -January 1 193,397 (698,961) 91,393 9,735
Fund balance (deficit) - December 31 $0 ($673,559) $146,611 $45,694
142
Exhibit G-4
Housing
Satellite Lane 57th Avenue Replacement Gateway Totals Nonmajor Capital Project
Apts. Redevelopment TIF#19 #1 NorthEast Funds
2012 2011
$41,562 $26,804 $114,687 $26,395 $ - $414,933 $433,760
- - - - - - 12,145
318 177 521 4,372 979 7,567 13,757
- - - 268,849 - 268,849 167,895
41,880 26,981 115,208 299,616 979 691,349 627,557
4,156 2,678 11,459 19,561 25,246 83,696 378,151
- - 103,132 - - 103,132 107,238
- - - 98,237 - 98,237 221,484
4,156 2,678 114,591 117,798 25,246 285,065 706,873
37,724 24,303 617 181,818 (24,267) 406,284 (79,316)
- - - - - (262,907) -
37,724 24,303 617 181,818 (24,267) 143,377 (79,316)
(315) (73,257) (4,012) (9,561) (1,122,023) (1,613,604) (1,534,288)
$37,409 ($48,954) ($3,395) $172,257 ($1,146,290) ($1,470,227) ($1,613,604)
143
I
1
___ __
__, _ _
, , ,
1
I
, „, _ _
CITY OF
FRIDLEY
144
AGENCY FUNDS
Agency Funds account for assets held by a governmental unit in a trustee
capacity or as an agent for individuals, private organizations, other governmental
units, and/or other funds.
145
Exhibit H-1
CITY OF FRIDLEY, MINNESOTA
COMBINING STATEMENT OF ASSETS AND LIABILITIES
AGENCY FUNDS
For The Year Ended December 31, 2012
Totals Agency Funds
Six Cities
Hotel/Motel Tax Watershed 2012 2011
Assets:
Cash and investments $2,442 $22,189 $24,631 $21,934
Receivables:
Accounts 2,766 - 2,766 2,572
Taxes:
Unremitted - - - 46
Delinquent - 61 61 208
Total assets $5,208 $22,250 $27,458 $24,760
Liabilities:
Due to other governments $5,208 $22,250 $27,458 $24,760
146
Exhibit H-2
CITY OF FRIDLEY, MINNESOTA
STATEMENT OF CHANGES IN ASSETS AND LIABILITIES
AGENCY FUNDS
For The Year Ended December 31, 2012
Balance Balance
January 1, December 31,
2012 Additions Deletions 2012
Six Cities Watershed
Assets:
Cash and investments $22,063 $22,189 $22,063 $22,189
Receivables:
Taxes:
Unremitted 46 - 46 -
Delinquent 208 269 416 61
Total assets $22,317 $22,458 $22,525 $22,250
Liabilities:
Due to other governments $22,317 $22,250 $22,317 $22,250
Hotel/Motel Tax
Assets:
Cash and investments ($129) $36,873 $34,302 $2,442
Receivables:
Accounts 2,572 32,520 32,326 2,766
Total assets $2,443 $69,393 $66,628 $5,208
Liabilities:
Due to other governments $2,443 $41,630 $38,865 $5,208
Totals
Assets:
Cash and investments $21,934 $59,062 $56,365 $24,631
Receivables:
Accounts 2,572 32,520 32,326 2,766
Taxes:
U n remitted 46 - 46 -
Delinquent 208 269 416 61
Total assets $24,760 $91,851 $89,153 $27,458
Liabilities:
Due to other governments $24,760 $63,880 $61,182 $27,458
147
4.
CITY OF
FRIDLEY
148
Statistical Section (Unaudited)
This part of the City of Fridley's statistical's comprehensive annual financial report
presents detailed information as a context for understanding what the information in the
financial statements, note disclosures, and required supplementary information says
about the City's overall financial health.
Contents Page
Financial Trends 150
These schedules contain trend information to help the reader understand how the
City's financial performance and well-being have changed over time.
Revenue Capacity 160
These schedules contain information to help the reader assess the factors
affecting the City's ability to generate its property tax.
Debt Capacity 166
These schedules present information to help the reader assess the affordability
of the City's current levels of outstanding debt and the City's ability to issue
additional debt in the future.
Demographic and Economic Information 172
These schedules offer demographic and economic indicators to help the reader
understand the environment within which the City's financial activities take
place and to help make comparisons over time and with other governments.
Operating Information 176
These schedules contain information about the City's operations and resources
to help the reader understand how the City's financial information relates to the
services the City provides and the activities it performs.
Sources: Unless otherwise noted, the information in these schedules is derived
from the comprehensive annual financial reports for the relevant year. The City
implemented Statement 34 in 2003; the City has chosen to provide information for that
year forward. Ultimately, these schedules will contain information for the last ten years.
149
CITY OF FRIDLEY,MINNESOTA
NET POSITION BY COMPONENT
Last ten fiscal years
(Accrual Basis of Accounting)
2003 2004 2005
Governmental activities:
Net investment in capital assets $18,930,543 $18,305,647 $18,458,113
Restricted 2,395,446 1,664,772 1,540,531
Unrestricted 10,326,790 11,735,908 13,331,115
Total governmental activities net position $31,652,779 $31,706,327 $33,329,759
Business-type activities:
Net investment in capital assets $17,003,867 $14,528,247 $16,454,772
Restricted - - -
Unrestricted 9,663,807 11,814,649 9,258,984
Total business-type activities net position $26,667,674 $26,342,896 $25,713,756
Primary government:
Net investment in capital assets $35,934,410 $32,833,894 $34,912,885
Restricted 2,395,446 1,664,772 1,540,531
Unrestricted 19,990,597 23,550,557 22,590,099
Total primary government net position $58,320,453 $58,049,223 $59,043,515
150
Table 1
2006 2007 2008 2009 2010 2011 _ 2012
$18,635,605 $18,245,265 $17,490,936 $16,141,958 $15,546,219 $14,554,639 $14,139,656
1,591,936 1,711,255 2,193,410 2,790,220 3,401,776 3,392,382 3,294,952
15,140,831 17,244,490 18,845,006 20,276,252 21,293,470 23,020,467 $24,238,798
$35,368,372 $37,201,010 $38,529,352 $39,208,430 $40,241,465 $40,967,488 $41,673,406
$17,354,621 $16,951,085 $16,381,443 $15,036,932 $15,105,503 $14,342,934 $13,560,980
7,955,426 7,722,458 7,869,185 8,308,078 7,647,848 7,387,634 8,235,948
$25,310,047 $24,673,543 $24,250,628 $23,345,010 $22,753,351 $21,730,568 $21,796,928
$35,990,226 $35,196,350 $33,872,379 $31,178,890 $30,651,722 $28,897,573 $27,700,636
1,591,936 1,711,255 2,193,410 2,790,220 3,401,776 3,392,382 3,294,952
23,096,257 24,966,948 26,714,191 28,584,330 28,941,318 30,408,101 32,474,746
$60,678,419 $61,874,553 $62,779,980 $62,553,440 $62,994,816 $62,698,056 $63,470,334
151
CITY OF FRIDLEY,MINNESOTA
CHANGES IN NET POSITION
Last ten fiscal years
(Accrual basis of accounting)
2003 2004 2005
Expenses
Governmental activities:
General government $3,944,682 $3,513,065 $4,448,175
Public safety 5,166,975 5,468,014 5,514,330
Public works 3,749,412 3,612,318 4,105,860
Community Development 939,918 602,335 793,836
Parks and recreation 1,105,240 993,570 767,599
Interest on long-term debt 605,639 544,478 443,533
Total governmental activities expenses 15,511,866 14,733,780 16,073,333
Business-type activities:
Liquor 5,010,636 5,005,198 4,919,458
Water 2,030,654 2,086,513 2,070,032
Sanitary sewer 3,419,100 3,256,371 3,570,113
Storm water 359,189 334,906 320,596
Total business-type activities expenses 10,819,579 10,682,988 10,880,199
Total primary government expenses $26,331,445 $25,416,768 $26,953,532
Program revenues
Governmental activities:
Charges for services:
General government $1,301,146 $1,032,130 $1,263,265
Public safety $542,725 $539,334 $569,993
Public works $77,166 $286,165 $189,766
Community Development $411,300 $441,649 $599,870
Parks and recreation $293,142 $369,736 $331,298
Operating grants and contributions 1,481,723 1,009,861 1,121,726
Capital grants and contributions 1,012,151 882,292 1,657,106
Total governmental activities program revenues 5,119,353 4,561,167 5,733,024
Business-type activities:
Charges for services:
Liquor 5,364,588 5,376,428 5,283,229
Water 1,806,358 1,763,623 1,771,846
Sanitary sewer 3,183,260 3,248,952 3,299,957
Storm water 366,667 381,360 384,860
Operating grants and contributions 37,976 208 600
Capital grants and contributions - - -
Total business-type activities program revenues 10,758,849 10,770,571 10,740,492
Total primary government program revenues $15,878,202 $15,331,738 $16,473,516
152
Table 2
Page 1 of 2
2006 2007 2008 2009 2010 2011 2012
$4,177,829 $4,074,480 $3,646,436 $3,324,698 $3,272,470 $3,321,402 $3,155,983
6,023,335 6,260,806 6,774,610 6,847,571 6,756,698 6,720,641 6,999,554
3,868,517 4,208,765 4,771,748 5,065,178 5,916,776 5,023,080 5,420,271
1,118,661 863,850 1,479,455 1,036,549 966,909 973,198 880,414
1,147,966 1,312,502 1,303,063 1,605,306 1,521,106 1,387,133 1,355,571
397,036 416,850 377,884 342,555 268,892 263,075 232,318
16,733,344 17,137,253 18,353,196 18,221,857 18,702,851 17,688,529 18,044,111
4,793,419 4,920,511 4,937,776 4,654,811 4,542,180 4,568,282 4,354,909
2,138,371 2,279,034 2,378,101 2,423,129 2,438,399 2,688,846 2,647,176
3,629,361 3,798,053 4,065,899 4,350,576 4,617,991 4,750,467 4,653,434
331,039 381,944 373,989 399,349 421,630 785,861 602,923
10,892,190 11,379,542 11,755,765 11,827,865 12,020,200 12,793,456 12,258,442
$27,625,534 $28,516,795 $30,108,961 $30,049,722 $30,723,051 $30,481,985 $30,302,553
1,443,361 $1,468,699 $1,600,769 $1,733,160 $1,755,123 $1,886,783 $1,979,737
609,721 709,209 759,892 690,115 717,003 796,308 862,584
197,968 49,399 64,042 23,034 66,938 378,142 28,144
470,733 656,674 510,908 523,508 501,897 570,685 554,129
346,382 381,432 376,621 347,044 364,093 325,682 369,899
1,304,510 930,593 818,805 930,765 939,123 1,148,315 1,030,887
1,919,108 834,748 2,078,572 1,476,989 1,952,934 1,374,651 1,564,146
6,291,783 5,030,754 6,209,609 5,724,615 6,297,111 6,480,566 6,389,526
5,136,029 5,252,910 5,275,467 4,973,000 4,855,880 4,893,436 4,705,523
1,929,573 1,990,047 2,110,621 2,419,400 2,390,836 2,418,226 2,773,101
3,345,017 3,461,615 3,873,806 3,784,000 4,052,800 4,245,654 4,549,254
391,032 392,016 404,562 457,862 421,815 457,083 571,707
514 - - - - - -
10,802,165 11,096,588 11,664,456 11,634,262 11,721,331 12,014,399 12,599,585
$17,093,948 $16,127,342 $17,874,065 $17,358,877 $18,018,442 $18,494,965 $18,989,111
153
CITY OF FRIDLEY, MINNESOTA
CHANGES IN NET POSITION
Last ten fiscal years
(Accrual basis of accounting)
2003 2004 2005
Net(expense)revenue:
Governmental activities ($10,392,513) ($10,172,613) ($10,340,309)
Business-type activities (60,730) 87,583 (139,707)
Total primary government net(expense) revenue ($10,453,243) ($10,085,030) ($10,480,016)
General revenues and other changes in net position
Governmental activities:
General property taxes $5,273,363 $5,816,656 $7,428,226
Grants not restricted to programs 3,751,560 3,436,473 3,365,739
Investment earnings 423,215 413,743 511,464
Gain on sale of property 10,468 680 434
Other - - -
Transfers - - -
Total governmental activities 9,458,606 9,667,552 11,305,863
Business-type activities:
Investment earnings 118,029 146,248 168,445
Gain on Sale of Property 6,530 - -
Other 6,502 - -
Transfers - - -
Total business-type activities 131,061 146,248 168,445
Total primary government $9,589,667 $9,813,800 $11,474,308
Change in net position:
Governmental activities ($933,907) ($505,061) $965,554
Business-type activities 70,331 233,831 28,738
Total primary government ($863,576) ($271,230) $994,292
154
Table 2
Page 2 of 2
2006 2007 2008 2009 2010 2011 2012
($10,441,561) ($12,106,499) ($12,143,587) ($12,497,242) ($12,405,740) ($11,207,963) ($11,654,585)
(90,025) (282,954) (91,309) (193,603) (298,869) (779,057) 341,143
($10,531,586) ($12,389,453) ($12,234,896 ($12,690,845) ($12,704,609) ($11,987,020) ($11,313,442)
$8,253,653 $8,986,924 $9,068,718 $9,175,888 $10,141,119 $10,126,395 $10,654,542
2,623,407 3,152,421 3,240,081 3,390,633 2,718,979 1,095,470 1,030,123
998,154 1,111,116 687,665 96,817 208,565 347,184 269,240
3,357 59,438 (24,802) 12,982 20,112 14,937 56,598
1,603 29,238 267 - - -
600,000 600,000 500,000 500,000 350,000 350,000 350,000
12,480,174 13,939,137 13,471,929 13,176,320 13,438,775 11,933,986 12,360,503
281,316 245,172 168,394 25,908 57,098 106,274 65,537
5,000 1,278 - (237,923) 112 - 9,680
(600,000) (600,000) (500,000) (500,000) (350,000) (350,000) (350,000)
(313,684) (353,550) (331,606) (712,015) (292,790) (243,726) (274,783)
$12,166,490 $13,585,587 $13,140,323 $12,464,305 $13,145,985 $11,690,260 $12,085,720
$2,038,613 $1,832,638 $1,328,342 $679,078 $1,033,035 $726,023 $705,918
(403,709) (636,504) (422,915) (905,618) (591,659) (1,022,783) 66,360
$1,634,904 $1,196,134 $905,427 ($226,540) $441,376 ($296,760) $772,278
155
Table 3
Page 1 of 2
CITY OF FRIDLEY, MINNESOTA
FUND BALANCES -GOVERNMENTAL FUNDS
Last ten fiscal years')
(Modified accrual basis of accounting)
2003 2004 2005 2006
General Fund:
Reserved $43,502 $83,822 $81,662 $77,476
Unreserved:
General fund 4,338,463 4,080,012 4,020,285 3,863,023
Designated for employee benefits - - - -
Designated for contingencies - - - -
Undesignated - - - -
Nonspendable - - - -
Restricted - - - -
Unassigned - - - -
Total general fund $4,381,965 $4,163,834 $4,101,947 $3,940,499
All other governmental funds:
Reserved for:
Long-term receivables $645,330 $541,244 $480,123 $415,908
Public safety - 1,155,225 688,214 203,131
Debt service 609,992 509,547 389,197 721,866
Unreserved, reported in:
Special revenue funds 2,172,012 541,748 1,098,995 1,106,623
Capital projects funds 6,490,428 7,001,390 6,881,523 6,963,524
Debt service 5,505,808 5,522,647 5,976,888 5,991,102
Restricted - - - -
Committed - - - -
Assigned - - - -
Unassigned - - - -
Total all other governmental funds $15,423,570 $15,271,801 $15,514,940 $15,402,154
('The City implemented GASB Statement No. 31 for the fiscal year ended December 31, 2003.
Therefore, information for years prior to 2003 is not available.
In 2011, the City adopted the provisions of Gorenmental Accounting Standards Board Statement
No. 54, Fund Balance Reporting and Governmental Fund Type Definitions.
156
Table 3
Page 2 of 2
2007 2008 2009 2010 2011 2012
$65,528 $48,561 $58,928 $59,755 $ - $ -
5,206,778 4,538,224 4,600,988 5,725,464 - -
- - - - 65,271 66,152
- - - - - 20,810
- - - - 6,708,284 7,582,360
$5,272,306 $4,586,785 $4,659,916 $5,785,219 $6,773,555 $7,669,322
$348,441 $277,560 $ - $ - $ - $ -
20,726 25,590 - - - -
1,214,519 1,564,217 1,734,624 2,066,732 - -
1,189,140 1,258,926 1,329,647 1,407,400 - -
5,223,563 5,944,556 5,056,148 5,796,931 - -
6,201,350 5,976,511 5,801,686 5,983,425 - -
- - - - 2,529,873 3,093,302
- - - - 2,209,067 2,328,583
- - - - 11,108,003 11,783,596
- - - (98,164) (97,712)
$14,197,739 $15,047,360 $13,922,105 $15,254,488 $15,748,779 $17,107,769
157
CITY OF FRIDLEY, MINNESOTA
CHANGES IN FUND BALANCES -GOVERNMENTAL FUNDS
Last ten fiscal years
2003 2004 2005
Revenues:
General property taxes $5,305,289 $5,809,631 $7,397,381
Special assessments 470,648 300,389 550,909
Licenses and permits 722,541 785,582 865,848
Intergovernmental 4,075,023 3,207,482 2,767,724
Charges for services 1,500,429 1,533,253 1,736,181
Fines and forfeits 216,368 176,878 164,104
Earnings on investments 330,133 325,307 411,333
Interest on loan 32,056 29,253 26,308
Other 2,023,544 2,085,069 2,625,899
Total revenues 14,676,031 14,252,844 16,545,687
Expenditures:
Current:
General government 3,569,952 3,155,617 4,244,496
Public safety 4,925,525 5,156,529 5,204,551
Public works 2,712,421 2,608,316 2,940,869
Community development 934,151 593,393 671,173
Parks and recreation 1,068,875 960,723 737,094
Debt service:
Principal 1,180,000 5,155,000 6,095,000
Interest 627,899 561,045 422,366
Bond issuance costs 2,201 32,968 35,997
Capital outlay 1,705,270 869,770 3,112,700
Contingency - - 907
Total expenditures 16,726,294 19,093,361 23,465,153
Revenues over(under) expenditures (2,050,263) (4,840,517) (6,919,466)
Other financing sources (uses):
Refunding bond issues - 3,920,000 -
Bonds issued - - 6,450,000
Premium/(discount) on bonds issue - (10,992) (7,160)
Proceeds from sale of capital assets - - -
Transfers in 579,109 558,609 657,878
Transfers out - -
Total other financing sources (uses) 579,109 4,467,617 7,100,718
Net change in fund balance ($1,471,154) ($372,900) $181,252
Debt service as a percentage of
noncapital expenditures 12.1% 31.5% 32.2%
Debt service as percentage of total expenditures 10.8% 30.1% 27.9%
158
Table 4
2006 _ 2007 2008 2009 2010 2011 2012
$8,220,943 $8,927,963 $9,052,719 $9,072,267 $10,178,369 $10,113,120 $10,732,129
691,764 635,817 589,790 665,038 622,100 672,929 763,920
876,903 1,080,787 946,285 965,363 973,985 1,085,100 1,104,504
2,663,909 1,872,643 2,742,981 3,140,553 3,310,631 2,853,171 2,649,207
1,855,177 1,830,416 2,015,796 2,021,708 2,080,349 2,206,764 2,353,888
261,535 298,359 316,646 255,014 240,880 258,372 255,622
828,877 920,850 560,629 74,840 176,257 297,290 236,226
23,213 19,962 16,547 6,939 - - -
2,154,656 _ 2,288,309 2,220,276 2,043,252 1,992,971 325,284 322,354
17,576,977 17,875,106 18,461,669 18,244,974 19,575,542 17,812,030 18,417,850
3,567,503 3,893,952 3,338,228 3,086,441 3,010,835 3,165,111 3,503,326
5,821,523 5,999,557 6,323,910 6,446,714 6,329,354 6,284,658 6,422,646
2,944,911 3,025,157 3,406,468 3,376,641 3,111,918 3,061,100 3,047,300
1,113,543 861,872 1,189,033 895,057 967,487 979,042 772,070
1,118,392 1,194,290 1,366,154 1,301,140 1,292,783 1,195,410 1,252,089
1,555,000 1,825,000 2,075,000 2,215,000 2,445,000 800,000 940,000
330,431 359,010 379,340 366,500 287,961 271,969 232,318
31,742 42,986 9,139 1,801 45,094 2,799 47,016
4,452,500 3,114,203 2,684,938 2,144,649 1,812,087 964,410 1,639,773
20,935,545 20,316,027 20,772,210 19,833,943 19,302,519 16,724,499 17,856,538
(3,358,568) (2,440,921) (2,310,541) (1,588,969) 273,023 1,087,531 561,312
2,505,000 1,910,000 1,915,000 - 1,765,000 - 1,280,000
(30,720) - - - 53,163 - -
10,054 58,313 13,101 36,845 16,500 15,096 63,445
4,966,400 600,000 3,926,563 2,500,421 1,235,467 380,000 350,000
(4,366,400) - (3,380,023) (2,000,421) (885,467) - -
3,084,334 2,568,313 2,474,641 536,845 2,184,663 395,096 1,693,445
($274,234) $127,392 $164,100 ($1,052,124) $2,457,686 $1,482,627 $2,254,757
11.6% 12.9% 13.6% 14.6% 15.9% 6.6% 6.9%
9.2% 11.0% 11.9% 13.0% 14.4% 6.4% 6.8%
159
CITY OF FRIDLEY, MINNESOTA
TAX CAPACITY VALUE AND ESTIMATED MARKET VALUE OF TAXABLE PROPERTY
Last ten fiscal years
Commercial/
Fiscal Residential Industrial Public All
Year Property Property Utility Other
2003 Information Nof Avjle
2004 $11,163,343 $12,740,016 $44,539 $3,388,828
2005 12,619,948 12,517,532 46,563 3,762,125
2006 14,320,786 13,166,657 46,861 3,833,436
2007 15,074,008 14,500,008 46,953 4,236,896
2008 15,334,126 15,809,594 42,738 4,370,011
2009 14,716,967 16,788,860 38,680 4,455,969
2010 13,494,279 16,457,275 37,308 4,523,767
2011 12,175,452 15,182,227 41,236 4,396,579
2012 1 10,246,614 14,710,926 40,330 4,271,859
Source: Continuing Disclosure Document
After 2011 the State implemented the Homestead Market Value Exclusion program for residential properties. Beginning
in 2012 the HMVE program excludes a portion of the market value prior to the tax calculation.
160
Table 5
Less:
Total Fiscal Adjusted Total Estimated Tax Capacity
Tax Disparity Tax Capacity Direct Tax Market as a Percent
Capacity Contribution Value Rate Value of EMV
$25,007,789 $3,579,128 $21,428,661 28.616% $1,958,021,100 116.70%
27,336,726 4,292,061 23,044,665 30.248% 2,149,055,100 118.62%
28,946,168 4,624,091 24,322,077 33.565% 2,278,619,300 119.01%
31,367,740 4,115,595 27,252,145 31.941% 2,469,670,100 115.10%
33,857,865 4,587,794 28,341,514 31.349% 2,616,727,300 119.46%
35,556,469 5,221,355 30,303,832 30.324% 2,701,388,800 117.33%
36,000,476 5,757,073 31,758,133 28.640% 2,698,943,700 113.36%
34,512,629 6,128,318 30,862,682 32.258% 2,561,173,300 111.83%
31,795,494 6,212,406 28,088,605 36.986% 2,352,567,900 113.20%
29,269,729 5,629,374 26,491,814 39.615% 2,278,659,000 110.49%
161
it
CITY OF FRIDLEY, MINNESOTA
DIRECT AND OVERLAPPING PROPERTY TAX CAPACITY RATES
Last ten fiscal years
School School School
Fiscal District District District
Year City No. 11 No. 13 No. 14
2003 28.616% 26.941% 20.303% 29.966%
2004 30.248% 21.050% 22.833% 22.683%
2005 33.565% 21.492% 19.993% 21.606%
2006 31.941% 20.046% 19.571% 20.830%
2007 31.349% 19.353% 17.183% 24.175%
2008 30.324% 16.983% 15.942% 26.033%
2009 28.640% 18.263% 23.411% 31.172%
2010 32.258% 19.939% 24.398% 38.795%
2011 36.486% 24.023% 18.596% 40.631%
2012 39.615% 23.325% 24.024% 43.862%
Source: Continuing Disclosure Document
Notes:
11 Vocational/Technical District#916 is included in District No. 16.
(2)Six Cities Watershed District is included with School District No. 11.
(3)Rice Creek Watershed District is included with School District No. 13, 14 and 16.
(4)Stonybrook Creek Subwatershed is included with School District No. 11 and 14.
162
Table 6
i
School Total School School School School
District Special District District District District
No. 16(1) County Districts No. 11(2'41 No. 13(3) No. 14(3'4) No. 16(1'3)
22.054% 37.714% 7.666% 102.483% 96.360% 105.925% 98.111%
21.421% 35.221% 7.623% 95.446% 97.758% 97.525% 96.346%
16.118% 33.080% 8.085% 96.945% 96.329% 97.942% 92.454%
17.437% 32.096% 7.411% 92.136% 92.813% 94.072% 90.679%
25.779% 30.696% 6.829% 88.666% 87.770% 94.762% 96.366%
26.213% 31.078% 7.803% 86.608% 87.135% 97.226% 97.406%
27.155% 32.078% 8.783% 86.183% 92.840% 100.601% 96.584%
31.654% 35.189% 9.089% 94.964% 100.897% 115.294% 108.153%
33.959% 39.884% 10.533% 113.226% 109.392% 131.427% 124.755%
39.443% 41.146% 10.176% 111.953% 114.961% 134.799% 130.380%
163
Table 7
CITY OF FRIDLEY, MINNESOTA
PRINCIPAL PROPERTY TAXPAYERS
Current year and nine years ago
2012 2003
Percentage Percentage
Taxable of Total City Taxable of Total City
Capacity Capacity Capacity Capacity
Taxpayer Value Rank Value Value Rank Value
Medtronic, Inc. $1,849,758 1 6.32% $1,650,690 1 6.60%
Target Corporation 601,452 2 2.05% 661,506 2 2.65%
Shamrock Investments 585,764 3 2.00% 615,110 3 2.46%
Cummins Power(Onan) 377,712 4 1.29% 338,488 4 1.35%
Retail Trust IV(Wal-Mart/Sam's) 363,322 5 1.24% 251,604 6 1.01%
BAE 299,936 6 1.02% N/A 10 0.00%
Maurice Fillister(Georgetown) 246,498 7 0.84% 229,681 8 0.92%
University Avenue Associates 240,338 8 0.82% 280,500 5 1.12%
Riverpointe Apartments 188,981 9 0.65% 186,670 9 0.75%
Lifetime Fitness 201,156 10 0.69% 234,170 7 0.94%
Total $4,954,917 16.23% $4,448,419 17.80%
Total All Property $29,269,729 $25,007,789
Source: City Assessor
I
164
Table 8
CITY OF FRIDLEY, MINNESOTA
PROPERTY TAX LEVIES AND COLLECTIONS
Last ten fiscal years
Fiscal Taxes Collected Within The Collections
Year Levied Fiscal Year of the Levy in Total Collections to Date
Ended For The Percentage Subsequent Percentage
Dec. 31 Fiscal Year Amount of Levy Years Amount of Levy
2003 $5,320,517 $5,257,381 98.81% $62,665 $5,320,046 99.99%
2004 5,958,417 5,784,438 97.08% 154,019 5,938,457 99.67%
2005 7,543,382 7,394,304 98.02% 130,596 7,524,900 99.75%
2006 8,278,255 8,130,767 98.22% 120,328 8,251,095 99.67%
2007 8,772,149 8,614,537 98.20% 137,630 8,752,167 99.77%
2008 9,188,592 8,958,986 97.50% 119,946 9,078,932 98.81%
2009 9,110,847 8,856,384 97.21% 111,601 8,967,985 98.43%
2010 9,707,075 9,503,509 97.90% 82,896 9,586,405 98.76%
2011 10,014,071 9,897,610 98.84% 48,893 9,946,503 99.33%
2012 10,703,739 10,699,025 99.96% N/A 10,699,025 99.96%
Source: City Finance Department
165
CITY OF FRIDLEY, MINNESOTA
RATIOS OF OUTSTANDING DEBT BY TYPE
Last ten fiscal years
Governmental Activities
Percentage
of Estimated Estimated
Fiscal Improvement Tax Increment Equipment Market Value Market Value
Year Bonds Bonds Certificates Total of Property of Property
2003 $315,000 $10,705,000 $ - $11,020,000 0.56% $1,958,021,100
2004 190,000 9,595,000 - 9,785,000 0.46% 2,149,055,100
2005 1,805,000 8,335,000 - 10,140,000 0.45% 2,278,619,300
2006 4,310,000 6,780,000 - 11,090,000 0.45% 2,469,670,100
2007 6,065,000 5,110,000 - 11,175,000 0.43% 2,616,727,300
2008 7,615,000 3,400,000 - 11,015,000 0.41% 2,701,388,800
2009 7,080,000 1,720,000 - 8,800,000 0.33% 2,698,943,700
2010 7,570,000 - 550,000 8,120,000 0.32% 2,561,173,300
2011 6,770,000 - 550,000 7,320,000 0.31% 2,352,567,900
2012 5,880,000 - 1,780,000 7,660,000 0.34% 2,278,659,000
166
Table 9
Business Type Activities
Total
Sewer/Water Total Per Primary Per
Population Bonds Business Type Customer Government Capita
27,460 $2,800,000 $2,800,000 $338 $13,820,000 $401
27,480 5,405,000 5,405,000 657 15,190,000 356
27,088 3,815,000 3,815,000 458 13,955,000 374
26,679 3,420,000 3,420,000 415 14,510,000 416
26,603 3,015,000 3,015,000 366 14,190,000 420
26,459 6,440,000 6,440,000 781 17,455,000 416
26,422 5,865,000 5,865,000 712 14,665,000 333
27,208 8,160,000 8,160,000 992 16,280,000 298
27,388 7,625,000 7,625,000 927 14,945,000 267
27,790 7,070,000 7,070,000 859 14,730,000 275
167
Table 10
CITY OF FRIDLEY, MINNESOTA
DIRECT AND OVERLAPPING GOVERNMENTAL ACTIVITIES DEBT
December 31, 2012
Estimated
Estimated Share of
Debt Percentage Overlapping
Governmental Unit Outstanding Applicable' Debt
Debt repaid with property taxes:
Independent School District No. 11 $102,510,573 1.60% $1,640,169
Independent School District No. 13 21,955,000 31.46% 6,907,043
Independent School District No. 14 51,290,000 100.00% 51,290,000
Independent School District No. 16 124,525,000 36.80% 45,825,200
Metro Council 1,724,998,995 1.19% 20,527,488
Anoka County 151,019,654 18.04% 27,243,946
Vocational/Technical District No. 916 5,145,000 2.21% 113,705
Subtotal -overlapping debt 153,547,551
City of Fridley- Direct debt 14,730,000 100.00% 14,730,000
Total direct and overlapping debt $168,277,551
Sources: Continuing Disclosure Document
'Overlapping governments are those that coincide, at least in part, with the geographic boundaries of the City. This
schedule estimates the portion of the outstanding debt of those overlapping governments that is borne by the residents
and businesses of the City. This process recognizes that, when considering the City's ability to issue and repay long-term
debt, the entire debt burden borne by the residents and businesses should be taken into account. However, this does not
imply that every taxpayer is a resident, and therefore responsible for repaying the debt, of each overlapping government.
168
Table 11
CITY OF FRIDLEY, MINNESOTA
LEGAL DEBT MARGIN INFORMATION
Last ten fiscal years
Market Value $2,278,659,000
Debt Limit 3% of Market Value $68,359,770
Amount of Debt Applicable to Debt Limit:
Total Debt 14,730,000
Deductions:
Improvement Bonds $5,880,000
Revenue Bonds 7,070,000 12,950,000
Total Amount of Debt Applicable to Debt Limit 1,780,000
Legal Debt Margin $66,579,770
Legal Debt Margin Calculation for the last 10 Fiscal Years
Net Debt Legal Amount of Debt
Fiscal Debt Applicable to Debt Applicable to
Year Limit Limit Margin Debt Limit
2003 $38,755,912 $ - $33,380,154 0.00%
2004 42,589,016 - 38,755,912 0.00%
2005 45,168,942 - 42,589,016 0.00%
2006 49,393,402 - 45,168,942 0.00%
2007 52,334,546 - 49,393,402 0.00%
2008 54,027,776 - 52,334,546 0.00%
2009 80,968,311 - 54,027,776 0.00%
2010 76,835,199 550,000 76,285,199 0.72%
2011 70,577,037 550,000 70,027,037 0.78%
2012 68,359,770 1,780,000 66,579,770 2.60%
Note: State statutes limit the amount of general obligation debt a Minnesota City may issue to 3% of total
estimated market value; prior to 2008, the State Statute debt limit was 2%.
169
CITY OF FRIDLEY,MINNESOTA
PLEDGED-REVENUE COVERAGE
Last ten fiscal years
Improvement Bonds Equipment Certificates
Special Property
Fiscal Assessment Debt Service Tax Debt Service
Year Collections Principal Interest Coverage Collections Principal Interest Coverage
2003 $449,867 $150,000 $21,608 2.62 $ - $ - $ - -
2004 273,813 90,000 10,358 2.73 - - - -
2005 542,548 190,000 5,340 2.78 - - - -
2006 671,204 - 67,466 9.95 - - - -
2007 602,988 155,000 160,423 1.91 - - - -
2008 561,221 365,000 230,325 0.94 - - - -
2009 658,406 535,000 270,005 0.82 - - - -
2010 555,997 725,000 252,899 0.57 - - - -
2011 504,053 800,000 258,135 0.48 69,881 - 13,834 5.05
2012 - 890,000 229,503 0.00 70,668 50,000 13,450 1.11
170
Table 12
Utility Revenue Bonds Tax Increment Bonds
Utility Less Net Tax
Service Operating Avaliable Debt Service Increment Debt Service
Revenues Expenses Revenue Principal Interest Coverage Collections Principal Interest Coverage
$5,330,603 $5,664,739 ($334,136) $370,000 $141,002 -0.65 $3,624,968 $1,030,000 $606,291 2.22
5,371,662 5,430,082 (58,420) 390,000 334,960 -0.08 3,078,426 5,065,000 546,910 0.55
5,435,361 5,821,541 (386,180) 1,590,000 139,200 -0.22 3,224,204 5,905,000 417,026 0.51
5,648,720 5,977,607 (328,887) 395,000 121,164 -0.64 2,649,020 1,555,000 262,965 1.46
5,832,904 6,350,572 (517,668) 305,000 108,351 -1.25 3,586,097 1,670,000 199,488 1.92
6,379,984 6,631,304 (251,320) 300,000 149,481 -0.56 3,329,289 1,710,000 149,015 1.79
6,611,611 6,951,906 (340,295) 575,000 221,449 -0.43 2,016,580 1,680,000 96,495 1.14
6,855,441 7,236,513 (381,072) 515,000 241,508 -0.50 1,742,816 1,720,000 35,063 0.99
7,118,154 7,952,911 (834,757) 535,000 272,264 -1.03 69,881 - 13,834 5.05
7,864,406 7,648,478 215,928 555,000 255,054 0.27 - - - -
171
Table 13
CITY OF FRIDLEY, MINNESOTA
DEMOGRAPHIC AND ECONOMIC STATISTICS
Last ten fiscal years
Total Per Capita
Fiscal Unemployment Personal Personal
Year Population Rate Income Income
2003 27,460 4.3% $622,985,020 $22,687
2004 27,480 4.8% 691,644,120 25,169
2005 27,088 4.2% 695,674,016 25,682
2006 26,679 4.2% 703,978,773 26,387
2007 26,603 4.8% 712,747,576 26,792
2008 26,459 5.7% 708,889,528 26,792
2009 26,422 7.9% 688,160,990 26,045
2010 27,208 7.3% 744,138,800 27,350
2011 27,388 5.5% 742,077,860 27,095
2012 27,790 5.6% 755,109,880 27,172
I
Sources: Metropolitan Council (population), Continuing Disclosure Document(unemployment rate) 1
172
Table 14
CITY OF FRIDLEY, MINNESOTA
PRINCIPAL EMPLOYERS
Current year and nine years ado
2.012 2003
Percentage Percentage
of Total City of Total City
Employer Employees Rank Employment Employees Rank Employment
Medtronic, Inc. 2,758 1 12.34% 2,763 1 10.52%
Cummins Power(Onan) 1,700 2 7.61% 1,440 2 5.48%
Unity Medical Center 1,037 3 4.64% 465 6 1.77%
Target 842 4 3.77% 387 8 1.47%
Minco Products 517 5 2.31% 640 5 2.44%
ISD#14 (Fridley Schools) 475 6 2.13% - 0.00%
BAE Systems 350 7 1.57% 1,401 3 5.34%
Wal-Mart 294 8 1.32% - 0.00%
Kurt Manufacturing 230 9 1.03% 350 9 1.33%
Lofthouse Bakery 215 10 0.96% 318 10 1.21%
Parsons Electric - 0.00% 400 7 1.52%
Park Construction - 0.00% - 0.00%
Burlington - 0.00% 650 4 2.48%
Total 8,418 37.67% 8,814 33.57%
Total City Employment 22,345 26,257
Source: Continuing Disclosure Documents, Minnesota Department of Employment and Economic
Development and the Met Council.
173
CITY OF FRIDLEY, MINNESOTA
FULL-TIME EQUIVALENT CITY GOVERNMENT EMPLOYEES BY FUNCTION/PROGRAM
Last ten fiscal years
Full-Time Equivalent Employees as of December 31,
Function/Program 2003 2004 2005 2006
General government:
City administration 4 3 3 3
Finance 24 23 23 - 23
Human resource 2 2 2 2
Community development 10 8 8 10
Public safety:
Police department 50 46 46 47
Fire department 9 8 8 9
Public works:
Administration 5 4 4 4
Engineering 3 2 2 2
Mechanic 3 3 3 3
Streets 9 9 9 9
Water 6 5 5 5
Sewer 5 5 5 5
Parks 7 7 7 7
Parks and recreation:
Parks and recreation 9 5 8 11
Total 146 130 133 140
Source: City Finance Department
174
Table 15
Full-Time Equivalent Employees as of December 31,
2007 2008 2009 2010 2011 2012
3 3 3 3 3 3
22 22 19 19 19 20
2 2 2 2 2 2
7 9 7 7 7 7
44 44 45 42 43 44
9 8 8 8 8 8
2 2 2 2 2 2
4 4 4 4 3 3
3 3 3 3 3 3
9 9 9 9 9 9
5 5 5 5 7 7
5 5 5 5 5 5
7 7 7 7 5 5
8 8 8 8 8 8
130 131 127 124 124 126
175
CITY OF FRIDLEY, MINNESOTA
OPERATING INDICATORS BY FUNCTION/PROGRAM
Last ten fiscal years
Fiscal Year
Function/Program 2003 2004 2005 2006
Police:
Physical arrests 1,333 956 1,205 1,292
Parking violations 532 644 884 572
Traffic violations 2,429 2,129 1,789 5,152
Fire:
Emergency responses 2,549 2,406 2,719 2,568
Fires occurred 124 137 107 127
Commercial inspections 1,126 1,180 1,171 784
Rental inspections 299 471 296 231
Refuse collection:
Recyclables collected (tons per day) 6.70 6.70 6.69 6.95
Building inspection:
Permits issued:
Residential 642 624 750 768
Commercial 65 99 86 115
Total permit valuation $16,078,198 $22,029,469 $25,057,537 $21,750,596
Other public works:
Street resurfacing (miles) 1.2 1.2 4.1 4.8
1
Recreation
Springbrook Nature Ctr program participants 18,550 16,353 19,852 19,596
Water:
Connections 8,279 8,288 8,232 8,235
Storage capacity (gallons) 6,500,000 6,500,000 6,500,000 6,500,000 I
Average daily demand (gallons) 550,000 646,000 550,000 550,000
Peak daily demand (gallons) 9,000,000 13,190,000 10,000,000 10,990,000
Sewer:
Connections 8,288 8,297 8,250 8,244
Sources: Various City departments.
No operating indicators were available for the Parks, recreation and naturalist function.
176
Table 16
Fiscal Year
2007 2008 2009 2010 2011 2012
1,290 1,357 1,305 1,318 1,145 1,133
792 419 382 778 665 283
4,035 4,994 2,934 2,929 2,860 2,590
2,804 2,827 2,864 2,772 2,923 2,906
109 116 141 116 114 121
4,517 1,239 1,021 868 890 1,016
1,176 755 888 597 783 1,117
6.96 6.12 6.47 5.89 5.70 5.81
1,206 1,444 1,599 1,905 2,232 1,606
366 418 386 434 446 386
$47,871,624 $39,105,158 $45,564,657 $30,441,199 $39,902,641 $35,763,059
3.7 4.1 4.9 4.9 2.2 3.1
20,245 20,894 20,937 23,987 24,231 24,266
8,230 8,233 8,231 8,226 8,222 8,227
6,500,000 6,500,000 6,500,000 6,500,000 6,500,000 6,500,000
4,270,000 4,270,000 3,458,482 3,014,425 3,730,000 3,993,285
10,990,000 10,800,000 19,350,892 8,119,207 6,622,000 8,661,000
8,238 8,242 8,238 8,237 8,232 8,236
177
CITY OF FRIDLEY, MINNESOTA
CAPITAL ASSET STATISTICS BY FUNCTION/PROGRAM
Last ten fiscal years
Fiscal Year
Function/Program 2003 2004 2005 2006
Police:
Stations 1 1 1 1
Squad cars 12 12 12 12
Fire stations 3 3 3 3
Other public works:
Streets(miles) 125.3 125.3 125.3 125.3
Highways (miles) 10.3 10.3 10.3 10.3
Streetlights 1,054 1,054 1,055 1,055
Traffic signals 35 35 35 36
Parks and recreation:
Acreage 682 682 682 682
Playgrounds 29 29 29 29
Baseball/softball diamonds 22 22 22 22
Soccer/football fields 2 2 2 2
Community centers 1 1 1 1
Water:
Water mains (miles) 112.9 112.9 112.9 113.0
Fire hydrants 998 998 1,012 1,013
Storage capacity (gallons) 6.5 million 6.5 million 6.5 million 6.5 million
Wastewater:
Sanitary sewers (miles) 103.0 103.0 103.0 103.0
Storm sewers (miles) 49.3 49.3 50.0 52.0
Sources: Various City departments.
178
Table 17
Fiscal Year
2007 2008 2009 2010 2011 2012
1 1 1 1 1 1
12 12 12 12 12 12
3 3 3 3 3 3
125.3 125.3 125.3 125.3 125.3 125.3
10.3 10.3 10.3 10.3 10.3 10.3
1,059 1,059 1,059 1,059 1,059 1,059
36 36 36 36 36 36
682 682 682 682 682 682
29 29 29 29 29 29
22 22 22 22 22 22
2 2 2 2 2 2
1 1 1 1 1 1
113.0 113.0 113.0 113.0 113.0 113.0
1,013 1,013 1,013 1,013 1,013 1,013
6.5 million 6.5 million 6.5 million 6.5 million 6.5 million 6.5 million
103.0 103.0 103.0 103.0 103.0 103.0
52.0 52.0 52.0 52.0 52.0 52.0
179
F /
1c
„.
CITY OF
FRIDLEY
180