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2007 CAFR CITY OF FRIDLEY, MINNESOTA Comprehensive Annual Financial Report For the Fiscal Year Ended December 31, 2007 Prepared by: Finance Department Richard D. Pribyl Finance Director CITY OF FRIDLEY CITY OF FRIDLEY, MINNESOTA COMPREHENSIVE ANNUAL FINANCIAL REPORT YEAR ENDED DECEMBER 31, 2007 TABLE OF CONTENTS EXHIBITPAGE I. INTRODUCTORY SECTION Letter of Transmittal3 Certificate of Achievement for Excellence in Financial Reporting11 Elected and Appointed Officials13 City Administrative Organizational Structure 200714 II. FINANCIAL SECTION Independent Auditor's Report19 Management's Discussion and Analysis23 Basic Financial Statements: Government-Wide Financial Statements: Statement of Net AssetsA-135 Statement of ActivitiesA-236 Fund Financial Statements: Balance Sheet - Governmental FundsA-338 Statement of Revenues, Expenditures and Changes in Fund Balances - Governmental FundsA-440 Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds A-543 Statement of Net Assets - Proprietary FundsA-644 Statement of Revenues, Expenses and Changes in Fund Net Assets - Proprietary FundsA-746 Statement of Cash Flows - Proprietary FundsA-848 Statement of Fiduciary Net AssetsA-950 Notes to Financial Statements51 Required Supplementary Information: Budgetary Comparison Schedule - General FundB-182 Budgetary Comparison Schedule - Grant Management FundB-286 Budgetary Comparison Schedule - Note to RSI87 Combining and Individual Fund Statements and Schedules: Combining Balance Sheet - Nonmajor Governmental FundsC-194 Combining Statement of Revenues, Expenditures and Changes in Fund Balances - Nonmajor Governmental FundsC-295 CITY OF FRIDLEY, MINNESOTA COMPREHENSIVE ANNUAL FINANCIAL REPORT YEAR ENDED DECEMBER 31, 2007 TABLE OF CONTENTS EXHIBITPAGE Subcombining Balance Sheet - Nonmajor Special Revenue FundsC-398 Subcombining Statement of Revenues, Expenditures and Changes in Fund Balances - Nonmajor Special Revenue FundsC-4100 Special Revenue Funds: Cable TV Fund: Comparative Balance SheetD-1102 Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and ActualD-2103 Solid Waste Abatement Fund: Comparative Balance SheetD-3104 Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and ActualD-4105 HRA Reimbursement Fund: Comparative Balance SheetD-5106 Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and ActualD-6107 Drug and Gambling Forfeiture Fund: Comparative Balance SheetD-7108 Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and ActualD-8109 F. C. C. Donations Fund: Comparative Balance SheetD-9110 Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and ActualD-10111 Police Activity Fund: Comparative Balance SheetD-11112 Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and ActualD-12113 Springbrook Nature Center Fund: Balance SheetD-13114 Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and ActualD-14115 Capital Project Fund: Capital Improvement Fund: Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and ActualE-1116 CITY OF FRIDLEY, MINNESOTA COMPREHENSIVE ANNUAL FINANCIAL REPORT YEAR ENDED DECEMBER 31, 2007 TABLE OF CONTENTS EXHIBITPAGE Internal Service Funds: Combining Statement of Net AssetsF-1118 Combining Statement of Revenues, Expenses and Changes in Net AssetsF-2119 Combining Statement of Cash FlowsF-3120 Employee Benefits Fund: Comparative Statement of Net AssetsF-4121 Comparative Statement of Revenues, Expenses and Changes in Net AssetsF-5122 Comparative Statement of Cash FlowsF-6123 Self Insurance Fund: Comparative Statement of Net AssetsF-7124 Comparative Statement of Revenues, Expenses and Changes in Net AssetsF-8125 Comparative Statement of Cash FlowsF-9126 Information Systems Fund: Comparative Statement of Net AssetsF-10127 Comparative Statement of Revenues, Expenses and Changes in Net AssetsF-11128 Comparative Statement of Cash FlowsF-12129 Housing and Redevelopment Authority (Component Unit): Balance Sheet - Governmental FundsG-1132 Statement of Revenues, Expenditures and Changes in Fund Balances - Governmental FundsG-2134 Subcombining Balance Sheet - Nonmajor Capital Project FundsG-3136 Subcombining Statement of Revenues, Expenditures and Changes in Fund Balances - Nonmajor Capital Project FundsG-4138 Agency Funds: Statement of Changes in Assets and LiabilitiesH-1142 CITY OF FRIDLEY, MINNESOTA COMPREHENSIVE ANNUAL FINANCIAL REPORT YEAR ENDED DECEMBER 31, 2007 TABLE OF CONTENTS EXHIBITPAGE III. STATISTICAL SECTION (Unaudited) Financial Trends: Net Assets by ComponentTable 1145 Changes in Net AssetsTable 2146 Fund Balances - Governmental FundsTable 3148 Changes in Fund Balances - Governmental FundsTable 4149 Revenue Capacity: Tax Capacity Value and Estimated Market Value of Taxable PropertyTable 5150 Direct and Overlapping Property Tax Capacity RatesTable 6152 Principal Property TaxpayersTable 7154 Debt Capacity: Property Tax Levies and CollectionsTable 8155 Ratios of Outstanding Debt by TypeTable 9156 Direct and Overlapping Govermental Activities DebtTable 10158 Demographic and Economic: Legal Debt Margin InformationTable 11159 Pledged Revenue CoverageTable 12160 Operating Information: Demographic and Economic StatisticsTable 13162 Principal EmployersTable 14163 Full-time-Equivalent City Government Employees by Function/ProgramTable 15164 Operating Indicators by Function/ProgramTable 16166 Capital Asset Statistics by Funciton/ProgramTable 17168 I. INTRODUCTORY SECTION 11 111111 1 CITY OF FRIDLEY 22 222222 2 CITY OF FRIDLEY 44 444444 4 CITY OF FRIDLEY, MINNESOTA 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. ECONOMIC CONDITION AND OUTLOOK BACKGROUND AND LOCATION The City of Fridley is a first ring suburban community with an estimated 2007 population of 26,603. 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 year. However the unemployment rate for the City is now above that of the state and national average. The value of new construction for 2007 increased significantly from 2006 levels. In 2007 however there were only six new projects having a value greater than $500,000, compared to eight in 2006. Continued long-term growth is anticipated as Fridley continues to aggressively pursue redevelopment opportunities. Property values have continued to increase with an overall increase of 3.3% in estimated market value for all properties in Fridley, and a 1.2% increase in estimated market value for homesteaded residential property. MAJOR INITIATIVES For the Year The City has many accomplishments to report for 2007. The following list is a summary of the major initiatives completed throughout the year. 1.The City reconstructed 3.7 miles of streets throughout the City. This project work included new concrete curb and gutter, new base and asphalt, and water and sewer repairs as necessary. The final cost of this project was approximately $2.5 million. 2.Wells #5 and #10 were repaired as part of the City’s preventive maintenance program. This program helps to ensure a constant water supply for the City. 55555 5 CITY OF FRIDLEY, MINNESOTA ECONOMIC CONDITION AND OUTLOOK (CONTINUED) 3.Two new fire rescue trucks were put into service. 4.A new generator to keep power during emergencies for City Hall was installed and tested. 5.There were upgrades made to the security system at City Hall, including increased audio and video surveillance. 6.Phase 2 of irrigation improvements at the Community Park ball fields was completed. For the Future The future for the City of Fridley will be filled with change and restructuring depending on future legislative actions that may change the state’s tax structure, municipal redevelopment methods, and revenue streams. Traditional level of service is a concern as the City looks at potential reductions in revenue from traditional redevelopment practices and local government aid actions at the State Capitol. The City will continue to investigate alternatives that will allow creative solutions to the delivery of services. The City of Fridley is continuing to develop the complimentary anchor to the Gateway East development with a project called Gateway West. Of the 16 single-family units planned, seven have been built. The importance of this small development is the balance and positive image it will provide as people enter the community on University Avenue from the south. Also, along the east side of University Avenue, just north of Gateway East, properties are being purchased by the HRA as they become available. A series of citizen forums took place in 2007 to discuss ideas and get input on what people would like to see for redevelopment in this area. During 2007 Congress passed the Full Funding Grant Agreement for the Northstar Corridor Commuter Rail line which will run through Fridley. The line is expected to be up and running sometime in 2009. At this time there is no source of funding for a Fridley station, but there is an agreement in place calling for the Anoka County Regional Rail Authority to fund the approximately $1.6 million needed to construct a tunnel beneath the tracks where a Fridley station could be built. Improvements to our water and sewer utilities infrastructure can proceed as planned due to the approval by voters during 2007 to amend the City Charter taking away the restriction whereby utility rates could only be raised by the rate of inflation or 5% whichever is less. Significant projects budgeted for 2008 in the five year capital improvement plan include: replacement of fuel pumps at the Municipal Garage; the final year of an accelerated program to reconstruct city streets; Phase 3 of irrigation upgrades at Community Park; replacement of 66666 6 CITY OF FRIDLEY, MINNESOTA ECONOMIC CONDITION AND OUTLOOK (CONTINUED) scoreboards at Community Park; repairing and painting of two water towers and the annual well, reservoir, and pump house maintenance programs. 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. 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. CASH MANAGEMENT All temporary cash surpluses during the year are invested in various securities that State statutes permit. The City’s policy is to invest all available monies at competitive interest rates in accordance with the City’s over-all fiscal plan coordinated with operating needs and programs projected over the ensuing 12-month period. Investment yields on investments held during the year ranged from 3.35% to 5.15%. 77777 7 CITY OF FRIDLEY, MINNESOTA FINANCIAL INFORMATION (CONTINUED) RISK MANAGEMENT The Self-Insurance Fund was set up to account for all revenues and expenditures associated with the $50,000 deductible on the general liability policy. Self-insuring a larger deductible has reduced the annual premiums that allow us to directly benefit from our good experience rating. In the future an analysis will be made of the feasibility of self-insuring all or a portion of other policies. In 1990, $1,000,000 was transferred from the General Fund to the Self- Insurance Fund. OTHER INFORMATION PENSIONS City of Fridley employees are covered by one of three pension plans: 1. Fridley Fire Relief Association for Volunteer Firemen. 2. Public Employees Retirement Police and Fire Plan, covering the City’s full-time Firemen and Police Officers. 3. Coordinated Public Employees Retirement Plan, which covers other City civilian employees. The employees covered by the Coordinated Public Employees Retirement Plan are also covered by Social Security. The City is currently making all pension contributions required by law. For additional background information on the pension plans covering City employees, see Notes to the Financial Statements. 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. CERTIFICATE OF ACHIEVEMENT 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, Minnesota, for its comprehensive annual financial report for the fiscal year ended 88888 8 CITY OF FRIDLEY, MINNESOTA OTHER INFORMATION (CONTINUED) December 31, 2006. 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 our current Comprehensive Annual Financial Report continues to meet the Certificate of Achievement Program’s requirements and we 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 Craig Ellestad, Mike Jeziorski, Carol Meyer, and Marcy Everette 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. 99999 9 CITY OF FRIDLEY 1100 111111000000 10 11 111111111111 11 CITY OF FRIDLEY 1102 111111222222 12 CITY OF FRIDLEY, MINNESOTA ELECTED AND APPOINTED OFFICIALS DECEMBER 31, 2007 ELECTED OFFICIALS Term of Office Expires December Effective January 2008 MayorScott J.Lund2008 Councilmember At LargeRobert L. Barnette2008 Councilmember, Ward IJames T. Saefke2010 Councilmember, Ward IIDolores M. Varichak2010 Councilmember, Ward IIIAnn R. Bolkcom 2010 APPOINTED OFFICIALS City ManagerWilliam W. Burns City AttorneyFrederic W. Knaak Prosecuting AttorneyCarl J. Newquist City ClerkDebra A. Skogen Department Heads: Finance Director/TreasurerRichard D. Pribyl Director of Public Safety and Civil DefenseDonovan W. Abbott Fire ChiefJohn D. Berg Director of Public WorksJames P. Kosluchar Director of Recreation and Natural ResourcesJack G. Kirk Director of Community DevelopmentScott J. Hickok Director of Human ResourcesDeborah K. Dahl 1133 13 CITY ADMINISTRATIVE ORGANIZATIONAL STRUCTURE 2007 City of Fridley Authorized Full-Time "40 Hours A Week" General Fund Positions - 110 CITY MANAGEMENT (3) City Manage r Admnin Assistant to the City Manager Non-General Fund CABLE TV FUND Cable Administrator FINANCE (23)POLICE (45)HUMAN RESOURCES (2) Finance Director - TreasurerPublic Safety DirectoHuman Resources Director r Administrative AssistantAdministrative AssistantAdministrative Assistant (2) Accountants OPERATIONS (29) ACCOUNTING (5)Captain Assistant Finance Director (6) Sergeants Payroll Coordinator(22) Patrol Officers Accounting Specialist TECHNICAL SUPPORT (14) (2) Acctg-Data Processing Clerks Captain ASSESSING (2) (1) Sergeant City Assesso r(7) Detectives Appraiser Projects Coordinator Crime Prevention Specialist MIS (2) Office Supervisor MIS Coordinato r(2) Police Technicians PC Technician (Also 3 at 32 hrs/week) CITY CLERK - RECORDS (2)FIRE (9) City Cler k Fire Chie Licensing & Records Technicianf Administrative Assistant Assistant Chief Fire Marshal Non-General Fund(3) Full-time Firefighters LIQUOR (6) Liquor Operations ManageRENTAL INSPECTIONS (2) r Assistant Manager Rental Inspection Asst. (4) Lead Liquor Store Clerks Full-time Firefighter WATER ADMIN (2) Utility Billing Clerk Acctg-Data Processing Clerk 1111144444 14 PUBLIC WORKS (35)PARKS &COMMUNITY RECREATION (8)DEVELOPMENT (10) Public Works Directo r Parks & Recreation DirectorCommunity Developmen Administrative Assistantt Director Recreation Office Coordinator (2) Program SupervisorsAdministrative Assistant ENGINEERING (2) (1) Sr Citizens Program Supervisor Assistant Public Works DirectorBUILDING INSPECTION (3) Chief Building Official (2) Engineering Technician Non-General FundBuilding Inspector PW MAINTENANCE (20)SPRINGBROOK NATURE Permit Technician CENTER (3) Administrative Assistant Nature Center DirectorPLANNING (2) Fleet Services Coord.Planning Coordinato Program Supervisorr (2) Mechanic Administrative AssistantPlanner Street Superviso rNon-General Fund SOLID WASTE (1) (8) Public Service Worker Environmental Planner Parks Superviso r SECTION 8 HOUSING (1) (6) Public Service Worker Coordinator (.75 FTE) Non-General Fund WATER (5)HRA (1) Water Superviso r Assistant Executive Director (4) Public Service Worker SEWER (5) Sewer Supervisor (4) Public Service Worker 1111155555 15 CITY OF FRIDLEY 1146 111111666666 16 II. FINANCIAL SECTION 1157 111111777777 17 CITY OF FRIDLEY 1168 111111888888 18 CITY OF FRIDLEY 1280 222222000000 20 CITY OF FRIDLEY 2202 222222222222 22 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, 2007. 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 9 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 $61,874,553 (Net assets). Of this amount, $24,966,948 (unrestricted net assets) 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 2007, the City’s total net assets increased by $1,196,134. As of the close of the current fiscal year, the City of Fridley’s governmental funds reported combined ending fund balances of $19,470,045. Of this total amount, $13,154,092, or 68% is designated or reserved through legal restrictions and City Council authorization. At the end of the current fiscal year the general fund balance of $5,272,306, included $65,528 reserved and $5,206,778 designated. The City’s total debt decreased by $280,456 during the current fiscal year, it went from $15,310,507 to $15,030,051. Overview of the Financial Statements This discussion and analysis is 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 assets presents information on all of the City of Fridley’s assets and liabilities, with the difference between the two reported as net assets. Over time, increases or decreases in net assets may serve as a useful indicator of whether the financial position of the City of Fridley is improving or deteriorating. 23 Managements Discussion and Analysis ’ The statement of activities presents information showing how the City’s net assets changed during the most recent fiscal year. All changes in net assets 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 parks, 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 35 through 37 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. 24 Managements Discussion and Analysis ’ The City of Fridley maintains six 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, grant management fund, special assessment debt service fund, tax increment 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 nonmajor 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 38 through 43 of 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 44 through 49 of 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. 25 Managements Discussion and Analysis ’ The basic fiduciary fund financial statement can be found on page 50 of this report. 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 51 through 80 of this report. Other information. The combining statements referred to earlier in connection with the nonmajor 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 94 through 144 of this report. Government-wide Financial Analysis As noted earlier, net assets 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 $61,874,553at the close of the most recent fiscal year. The largest portion of the City of Fridley's net assets ($35,196,350 or 57 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 ASSETS Governmental ActivitiesBusiness-TypeTotals 200620072006200720062007 Current and other assets$25,355,341$26,342,042$8,721,040$8,223,336$34,076,381$34,565,378 Capital assets22,945,60524,310,26520,770,16719,962,14043,715,77244,272,405 Total assets$48,300,946$50,652,307$29,491,207$28,185,476$77,792,153$78,837,783 Long-term liabilities outstanding$9,406,815$9,215,138$3,010,546$2,711,055$12,417,361$11,926,193 Other liabilities3,525,7594,236,1591,170,614800,8784,696,3735,037,037 Total liabilities$12,932,574$13,451,297$4,181,160$3,511,933$17,113,734$16,963,230 Net assets: Invested in capital assets, net of related debt$18,635,605$18,245,265$17,354,621$16,951,085$35,990,226$35,196,350 Restricted1,591,9361,711,255 - - 1,591,9361,711,255 Unrestricted15,140,83117,244,4907,955,4267,722,45823,096,25724,966,948 Total net assets$35,368,372$37,201,010$25,310,047$24,673,543$60,678,419$61,874,553 26 Managements Discussion and Analysis ’ A portion of the of the City of Fridley's net assets represents resources that are subject to external restrictions on how they may be used. The remaining balance of unrestricted net assets ($24,966,948) 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 assets, 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 assets by $1,832,638. Property taxes increased by $733,271 due to decertified tax increment financing districts and for the debt service levy related to the 2006 General Obligation Improvement Bonds. Investment earnings grew by $112,962 because of higher interest rates, and community development expenses decreased by $254,811 because of decreased grant activity. City of Fridley's Changes in Net Assets CITY OF FRIDLEY'S CHANGES IN NET ASSETS Governmental ActivitiesBusiness-Type ActivitiesTotals 200620072006200720062007 Revenues: Program revenues: Charges for services$3,068,165$3,265,413$10,801,651$11,096,588$13,869,816$14,362,001 Operating grants and contributions1,304,510930,593514 - 1,305,024930,593 Capital grants and contributions1,919,108834,748 - - 1,919,108834,748 General revenues: - - Property taxes8,253,6538,986,924 - - 8,253,6538,986,924 Grants and contributions not restricted to specific programs2,623,4073,152,421 - - 2,623,4073,152,421 Unrestricted investment earnings998,1541,111,116281,316245,1721,279,4701,356,288 Gain on sale of property3,35759,4385,0001,2788,35760,716 Other1,60329,238 - - 1,60329,238 Total revenues18,171,95718,369,89111,088,48111,343,03829,260,43829,712,929 Expenses: General government4,177,8294,074,480 - - 4,177,8294,074,480 Public safety6,023,3356,260,806 - - 6,023,3356,260,806 Public works3,868,5174,208,765 - - 3,868,5174,208,765 Community development1,118,661863,850 - - 1,118,661863,850 Recreation and naturalist1,147,9661,312,502 - - 1,147,9661,312,502 Interest on long-term deb397,036416,850 - - 397,036416,850 t Liquor - - 4,793,4194,920,5114,793,4194,920,511 Water - - 2,138,3712,279,0342,138,3712,279,034 Sewer - - 3,629,3613,798,0533,629,3613,798,053 Storm water - - 331,039381,944331,039381,944 Total expenses 16,733,34417,137,25310,892,19011,379,54227,625,53428,516,795 Increase (decrease) in net assets before transfers1,438,6131,232,638196,291(36,504)1,634,9041,196,134 Transfers600,000600,000(600,000)(600,000) - - Increase in net assets2,038,6131,832,638(403,709)(636,504)1,634,9041,196,134 Net assets - January 133,329,75935,368,37225,713,75625,310,04759,043,51560,678,419 Net assets - December 31$35,368,372$37,201,010$25,310,047$24,673,543$60,678,419$61,874,553 27 Managements Discussion and Analysis ’ Below are specific graphs which provide comparisons of the governmental activities revenues and expenses: Governmental Activities - Revenues Unrestricted investment Charges for services earnings 6% Grants and contributions Operating 18% not restricted to specific grants and programs 17% contributions 5% Gain on sale of property 0% Capital grants and contributions 5% Property taxes Governmental Activities - Expenses Interest on Recreation long-term debt 2% and naturalist 8% Community General Development government 24% 5% Public works 25% Public safety 36% 28 Managements Discussion and Analysis ’ Business-Type Activities Business-type activities decreased net assets by $636,504. Charges for utility services ($5,843,678) did not keep up with expenses for the utilities ($6,459,031). This is because the City Charter restricted the increase in utility rates to the rate of inflation or 5% whichever is lower, even though expenses for the utilities are increasing by a rate greater than inflation. Below are graphs showing the business-type activities revenue and expense comparisons: Business-Type Activities - Revenues Unrestricted investment earnings 2% Charges for services 98% Business-Type Activities - Expenses Storm water 3% Liquor 44% Water 20% ` Sewer 33% 29 Managements 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, unreserved 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 $19,470,045. Approximately 92 percent of this amount ($17,820,831) constitutes unreserved fund balance. The remainder of the fund balance ($1,649,214) is reserved because it has already been committed 1) to provide for inventory ($56,346), 2) to pay debt service ($1,214,519), 3) for loans receivable ($357,623) and 4) for police purposes ($20,726). The General Fund’s fund balance increased by $1,331,807 in 2007. This was a significant departure from the decrease originally budgeted for. The key reason for this was because of a one-time transfer from the Special Assessment Construction Capital Projects Fund. The Special Assessment Debt Service Fund’s fund balance increased by $635,434 due to prepaid special assessments collected on the 2007 Street Reconstruction Project. The Special Assessment Construction Capital Projects Fund’s fund balance decreased by $1,374,731 in 2007. This was mainly due to a one-time transfer to the General Fund. 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. The unrestricted net assets in the respective proprietary funds are liquor $823,054, water $2,386,128, sewer $3,795,955 and storm water $717,321. The liquor, water, sewer and storm water funds had decreases in net assets of $158,381, $206,638, $212,034 and $59,451, respectively. Budgetary Highlights General Fund The original budget was amended to move $423,109 in state aid credits from taxes to intergovernmental revenue. The budget for election expenditures was increased by $11,659 due to a special election that was held during the year. The original budget for contingency was decreased by $100,000 during the year. This was due to its budget being allocated to budgets in other departments. Expenditures in total were less than the final budgetary estimates by $349,052. Significant variances include the City Manager department which expended $13,473 less than 30 Managements Discussion and Analysis ’ anticipated, the Accounting department which expended $37,996 less than anticipated, the Police department which expended $105,148 less than anticipated and the MIS department which expended $32,170 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, 2007, amounts to $44,272,405 (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 ActivitiesBusiness-Type ActivitiesTotals 200620072006200720062007 Land$2,841,516$2,841,516$306,477$306,477$3,147,993$3,147,993 Buildings and structures3,165,046 2,865,675 1,991,488 1,904,854 5,156,534 4,770,529 Improvements other than buildings1,040,474 1,092,338 6,098,339 5,735,313 7,138,813 6,827,651 Machinery and equipment2,413,806 2,378,654 735,566 674,069 3,149,372 3,052,723 Infrastructure13,275,586 15,028,116 11,638,297 11,341,427 24,913,883 26,369,543 Construction in progress209,177 103,966 - - 209,177 103,966 Total Capital Assets$22,945,605$24,310,265$20,770,167$19,962,140$43,715,772$44,272,405 Additional information on the City of Fridley’s capital assets can be found in Note 4. Long-term debt . At the end of the current fiscal year, the City of Fridley had total bonded debt outstanding of $14,190,000, a decrease of $320,000 from 2006. $6,065,000 of this is for general obligation improvement debt which is supported by special assessments and a property tax levy, an additional $5,110,000 is for general obligation tax increment debt which financed the City’s housing and redevelopment program, and $3,015,000 is general obligation utility revenue bonds which financed utility improvements. In 2007, the City issued $1,910,000 in general obligation improvement bonds. In addition, there is long-term debt in the amount of $843,996 for compensated absences. Additional information on the City of Fridley’s long-term debt can be found in Note 5. 31 Managements Discussion and Analysis ’ City of Fridley’s Outstanding Debt General Obligation Improvement Bonds, General Obligation Tax Increment Bonds, General Obligation Revenue Bonds, and Compensated Absences (excluding bond discounts) are as follows: Governmental ActivitiesBusiness-Type ActivitiesTotals 200620072006200720062007 General Obligation Improvement Bonds$4,310,000$6,065,000$ - $ - $4,310,000$6,065,000 General Obligation Tax Increment Bonds6,780,0005,110,000 - - 6,780,0005,110,000 General Obligation Revenue Bonds - - 3,420,0003,015,0003,420,0003,015,000 Compensated Absences804,961843,996 - - 804,961843,996 Total$11,894,961$12,018,996$3,420,000$3,015,000$15,314,961$15,033,996 The City of Fridley has an Aa2 rating from Moody's Investors Service. State statutes limit the amount of general obligation debt a Minnesota city may issue to 2% of total Estimated Market Value. The current debt limitation for the City of Fridley is $52,334,546. None of the City's outstanding debt is counted within the statutory limitation. Requests for information. This financial report is designed to provide a general overview of the City of Fridley’s finances for all those with an interest in the government’s finances. Questions concerning any of the information provided in this report or requests for additional financial information should be addressed to the Finance Director, 6431 University Avenue NE, Fridley, Minnesota 55432. 32 BASIC FINANCIAL STATEMENTS 3335 333333333333 33 CITY OF FRIDLEY 3346 333333444444 34 Exhibit A-1 CITY OF FRIDLEY, MINNESOTA STATEMENT OF NET ASSETS December 31, 2007 Component Unit Primary GovernmentHousing & Redevelopment GovernmentalBusiness-TypeTotalsAuthority ActivitiesActivities2007200620072006 Assets: Cash and investments$23,565,412$5,496,636$29,062,048$28,120,594$16,340,746$17,073,927 Receivables: Accounts145,1121,819,6171,964,7291,811,18533,47436,495 Taxes259,29681259,377195,575227,435146,883 Special assessments1,772,86517,4461,790,3111,661,188 - - Mortgage - - - - 1,023,0821,203,577 Interest55,533 - 55,533155,1335,8225,737 Loan from component unit348,441 - 348,441415,908 - - Notes9,182 - 9,18218,364 - - Due from component unit54,418 - 54,418146,811 - - Due from other governments75,4373,95279,389517,311 - - Due from primary government - - - - 18,480 Prepaid items - 249,750249,750226,3075,499 - Inventories - at cost56,346635,854692,200808,005 - - Land held for resale - - - - 2,608,7381,123,665 Capital assets (net of accumulated depreciation): Land2,841,516306,4773,147,9933,147,993 - - Buildings and structures2,865,6751,904,8544,770,5295,156,534 - - Improvements other than buildings1,092,3385,735,3136,827,6517,138,813 - - Machinery and equipment2,378,654674,0693,052,7233,149,372 - - Infrastructure15,028,11611,341,42726,369,54324,913,883 - - Construction in progress103,966 - 103,966209,177 - - Total assets50,652,30728,185,47678,837,78377,792,15320,263,27619,590,284 Liabilities: Due to primary government - - - - 54,418146,811 Accounts payable322,667355,229677,896629,306381,513419,658 Deposits payable 53,711 - 53,71153,000 - - Contracts payable289,350 - 289,350100,973 - - Due to other governments70,59867,136137,734341,815 - - Due to component unit18,480 - 18,480 - Salaries payable381,53433,983415,517353,387 - - Accrued interest payable176,17644,530220,706211,248 - - Compensated absences payable: Due within one year728,858 - 728,858663,146 - - Due in more than one year115,138 - 115,138141,815 - - Unearned revenue119,785 - 119,785113,498 - - Loan payable to primary government: Due within one year - - - - 70,88267,467 Due in more than one year - - - - 277,559348,441 Bonds payable: Due within one year2,075,000300,0002,375,0002,230,000 - - Due in more than one year9,100,0002,711,05511,811,05512,275,546 - - Total liabilities13,451,2973,511,93316,963,23017,113,734784,372982,377 Net assets: Invested in capital assets, net of related debt18,245,26516,951,08535,196,35035,990,226 - - Restricted for: Debt service1,690,977 - 1,690,9771,388,805 - - Public safety20,278 - 20,278203,131 - - Tax increment purposes - - - - 2,233,6531,191,527 Unrestricted17,244,4907,722,45824,966,94823,096,25717,245,25117,416,380 Total net assets$37,201,010$24,673,543$61,874,553$60,678,419$19,478,904$18,607,907 The accompanying notes are an integral part of these financial statements. 3333355555 35 CITY OF FRIDLEY, MINNESOTA STATEMENT OF ACTIVITIES For The Year Ended December 31, 2007 Program Revenues Operating Charges ForGrants and ExpensesServicesContributions Functions/Programs Primary government: Governmental activities: General government$4,074,480$1,468,699$ - Public safety6,260,806709,209559,337 Public works4,208,76549,399223,584 Community development863,850656,674123,918 Parks, recreation and naturalist1,312,502381,43223,754 Interest on long-term debt416,850 - - Total governmental activities17,137,2533,265,413930,593 Business-type activities: Liquor4,920,5115,252,910 - Water2,279,0341,990,047 - Sewer3,798,0533,461,615 - Storm water381,944392,016 - Total business-type activities11,379,54211,096,5880 Total primary government$28,516,795$14,362,001$930,593 Component units: Housing and Redevelopment Authority$4,052,567$9,600$ - Total component units$4,052,567$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 assets Net assets - January 1 Net assets - December 31 The accompanying notes are an integral part of these financial statements. 3333366666 36 Exhibit A-2 Net (Expense) Revenue and Changes in Net AssetsComponent Unit Primary GovernmentHousing & Redevelopment Capital TotalsAuthority Grants andGovernmentalBusiness-Type ContributionsActivitiesActivities2007200620072006 $ - ($2,605,781)$ - ($2,605,781)($2,734,468)$ - $ - - (4,992,260) - (4,992,260)(4,626,669) - - 834,748(3,101,034) - (3,101,034)(1,686,535) - - - (83,258) - (83,258)(217,022) - - - (907,316) - (907,316)(779,831) - - - (416,850) - (416,850)(397,036) - - 834,748(12,106,499)0(12,106,499)(10,441,561)00 - - 332,399332,399342,610 - - - - (288,987)(288,987)(208,798) - - - - (336,438)(336,438)(284,344) - - - - 10,07210,07260,507 - - 00(282,954)(282,954)(90,025)00 $834,748(12,106,499)(282,954)(12,389,453)(10,531,586)$0$0 $ -($4,042,967)($4,126,299) $0(4,042,967)(4,126,299) 8,986,924 - 8,986,9248,253,653373,572393,974 - - - - 3,586,0973,091,460 3,152,421 - 3,152,4212,623,40758,36162,089 1,111,116245,1721,356,2881,279,470709,192742,335 59,4381,27860,7168,357154,616327,093 29,238 - 29,2381,60332,126225,425 600,000(600,000) - - - - 13,939,137(353,550)13,585,58712,166,4904,913,9644,842,376 1,832,638(636,504)1,196,1341,634,904870,997716,077 35,368,37225,310,04760,678,41959,043,51518,607,90717,891,830 $37,201,010$24,673,543$61,874,553$60,678,419$19,478,904$18,607,907 The accompanying notes are an integral part of these financial statements. 3333377777 37 CITY OF FRIDLEY, MINNESOTA BALANCE SHEET GOVERNMENTAL FUNDS December 31, 2007 Special GrantAssessment General FundManagementDebt Service Assets Cash and investments$5,554,464$118,310$7,412,164 Receivables: Accounts68,158 - - Taxes238,491 - 8,823 Special assessments51,249 - 1,621,645 Interest55,533 - - Loan receivable from component unit - - 348,441 Developer note9,182 - - Due from other funds50,841 - - Due from component unit45,208 - - Due from other governments33,8903,701 - Inventories, at cost56,346 - - Total assets$6,163,362$122,011$9,391,073 Liabilities and Fund Balances Liabilities: Accounts payable$258,594$355$ - Deposits payable53,711 - - Contracts payable - - - Due to other governments34,670 - - Due to component unit18,480 - - Due to other funds - - - Salaries payable283,3621,872 - Deferred revenue242,239119,7841,626,763 Total liabilities891,056122,0111,626,763 Fund balances: Reserved for: Inventory56,346 - - Long-term receivables9,182 - 348,441 Public safety - - - Debt service - - 1,214,519 Unreserved: Designated reported in: General Fund5,206,778 - - Special Revenue Funds - - - Capital Project Funds - - - Undesignated reported in: Special Revenue Funds - - - Debt Service Funds - - 6,201,350 Capital Project Funds - - - Total fund balances5,272,30607,764,310 Total liabilities and fund balances$6,163,362$122,011$9,391,073 The accompanying notes are an integral part of these financial statements. 3333388888 38 Exhibit A-3 Special AssessmentOther Tax Increment ConstructionCapitalGovernmentalIntra-Activity Debt ServiceCapital ProjectsImprovementsFundsEliminations Totals Governmental Funds 20072006 $ - $410,750$5,169,064$1,171,210$ - $19,835,962$18,539,019 - - - 76,954 - 145,112216,148 - - 2,8929,090 - 259,296195,417 - 99,971 - - - 1,772,8651,638,174 - - - - - 55,533155,133 - - - - - 348,441415,908 - - - - - 9,18218,364 - - - - (50,841) - - - - - 8,941 - 54,149146,379 - - - 37,846 - 75,437517,311 - - - - - 56,34659,112 $0$510,721$5,171,956$1,304,041($50,841)$22,612,323$21,900,965 $ - $ - $31,778$27,003$ - $317,730$241,443 - - - - - 53,71153,000 - 289,350 - - - 289,35098,752 - 3,04132,612275 - 70,59818,895 - - - - - 18,480 - - - - 50,841(50,841) - - - - - 8,344 - 293,578246,212 - 99,9712,3627,712 - 2,098,8311,900,010 0392,36266,75294,175(50,841)3,142,2782,558,312 - - - - - 56,34659,112 - - - - - 357,623434,272 - - - 20,726 - 20,726203,131 - - - - - 1,214,519721,866 - - - - - 5,206,7783,863,023 - - - 1,192,896 - 1,192,8961,106,623 - - 5,105,204 - - 5,105,2045,470,434 - - - (3,756) - (3,756) - - - - - - 6,201,3505,991,102 - 118,359 - - - 118,3591,493,090 0118,3595,105,2041,209,866019,470,04519,342,653 $0$510,721$5,171,956$1,304,041($50,841)$22,612,323$21,900,965 Fund balance reported above$19,470,045$19,342,653 Amounts reported for governmental activities in the statement of net assets are different because: Capital assets used in governmental activities are not financial resources, and therefore, are not reported in the funds.24,055,56422,619,696 Other long-term assets are not available to pay for current-period expenditures and, therefore, are deferred in the funds.1,979,0461,786,512 Long-term liabilities, including bonds payable, are not due and payable in the current period and therefore are not reported in the funds.(11,351,176)(11,251,322) 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 assets.3,047,5312,870,833 Net assets of governmental activities$37,201,010$35,368,372 The accompanying notes are an integral part of these financial statements. 3333399999 39 CITY OF FRIDLEY, MINNESOTA STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES GOVERNMENTAL FUNDS For The Year Ended December 31, 2007 Special GrantAssessment Debt ManagementService General Fund Revenues: Taxes$8,197,852$ - $344,221 Special assessments26,644 - 602,988 Licenses and permits878,423 - - Intergovernmental revenue1,606,946107,42918,450 Charges for services1,490,232 - - Fines and forfeits275,431 - - Investment income204,260 - 327,059 Interest on loan - - 19,962 Miscellaneous240,431357 - Total revenues12,920,219107,7861,312,680 Expenditures: Current: General government2,591,289 - - Public safety5,978,066 - - Public works3,025,157 - - Community development754,086107,786 - Parks, recreation and naturalist832,954 - - Debt service - - 315,423 Capital outlay386,300 - - Total expenditures13,567,852107,786315,423 Excess (deficiency) of revenues over (under) expenditures(647,633)0997,257 Other financing sources (uses): Bonds issued - - - Premium/(discount) on bonds issued - - - Proceeds from sale of capital assets58,313 - - Transfers in1,921,127 - - Transfers out - - (361,823) Total other financing sources (uses)1,979,4400(361,823) Net change in fund balance1,331,8070635,434 Fund balance - January 13,940,499 - 7,128,876 Fund balance - December 31$5,272,306$0$7,764,310 The accompanying notes are an integral part of these financial statements. 444444000000 40 Exhibit A-4 Special AssessmentOther Tax Increment ConstructionCapitalGovernmentalIntra-Activity Debt ServiceCapital ProjectsImprovementsFundsEliminationsTotals Governmental Funds 20072006 $ - $ - $97,388$288,502$ - $8,927,963$8,220,943 - 6,185 - - - 635,817691,764 - - - 202,364 - 1,080,787876,903 - - 70,52669,292 - 1,872,6432,663,909 - 6,770 - 333,414 - 1,830,4161,855,177 - - - 22,928 - 298,359261,535 - 5,114328,38656,031 - 920,850828,877 - - - - - 19,96223,213 1,869,938 - 43,378134,205 - 2,288,3092,154,656 1,869,93818,069539,6781,106,736017,875,10617,576,977 - 468,101200,765633,797 - 3,893,9523,567,503 - - - 21,491 - 5,999,5575,821,523 - - - - - 3,025,1572,944,911 - - - - - 861,8721,113,541 - - - 361,336 - 1,194,2901,118,394 1,869,938 - 41,635 - - 2,226,9961,917,173 - 2,638,31189,592 - - 3,114,2034,452,500 1,869,9383,106,412331,9921,016,624020,316,02720,935,545 0(3,088,343)207,68690,1120(2,440,921)(3,358,568) - - 1,910,000 - - 1,910,0002,505,000 - - - - - - (30,720) - - - - - 58,31310,054 - 2,694,739 - - (4,015,866)600,000600,000 - (981,127)(2,482,916)(190,000)4,015,866 - - 01,713,612(572,916)(190,000)02,568,3133,084,334 0(1,374,731)(365,230)(99,888)0127,392(274,234) - 1,493,0905,470,4341,309,754 - 19,342,65319,616,887 $0$118,359$5,105,204$1,209,866$0$19,470,045$19,342,653 The accompanying notes are an integral part of these financial statements. 444444111111 41 CITY OF FRIDLEY 4424 444444222222 42 Exhibit A-5 CITY OF FRIDLEY, MINNESOTA RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS For The Year Ended December 31, 2007 20072006 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)$127,392($274,234) 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.1,435,8682,778,274 Revenues in the statement of activities that do not provide current financial resources are not reported as revenues in the funds.192,534445,559 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 assets. This amount is the net effect of these differences in the treatment of long-term debt and related items.(85,000)(950,000) 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.176,69843,157 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.(14,854)(4,143) Change in net assets of governmental activities (Exhibit A-2)$1,832,638$2,038,613 The accompanying notes are an integral part of these financial statements. 444444333333 43 CITY OF FRIDLEY, MINNESOTA STATEMENT OF NET ASSETS PROPRIETARY FUNDS December 31, 2007 Business-Type Activities - Enterprise Funds LiquorWater Assets: Current assets: Cash and cash equivalents$529,659$1,752,520 Accounts receivable320737,943 Taxes receivable: Delinquent - - Special assessments receivable - 4,750 Due from component units - - Due from other governments - - Inventories, at cost622,45313,401 Prepaid items - - Total current assets1,152,432 2,508,614 Noncurrent assets: Capital assets: Land151,946154,531 Buildings and structures130,2113,107,420 Improvements other than buildings650,2456,442,438 Machinery and equipment208,9301,644,886 Infrastructure - 8,640,260 Total capital assets1,141,332 19,989,535 Less: Allowance for depreciation(616,129)(9,774,671) Net capital assets525,20310,214,864 Total noncurrent assets525,20310,214,864 Total assets1,677,63512,723,478 Liabilities: Current liabilities: Accounts payable269,46145,991 Accrued interest payable - 44,530 Contracts payable - - Due to other governments47,76419,372 Salaries payable12,15312,593 Payroll deductions payable - - Compensated absences payable - - Bonds payable - current - 300,000 Total current liabilities329,378 422,486 Noncurrent liabilities: Compensated absences - noncurrent - - Bonds payable - noncurrent - 2,711,055 Total noncurrent liabilities0 2,711,055 Total liabilities329,3783,133,541 Net assets: Invested in capital assets, net of related debt525,2037,203,809 Unrestricted823,0542,386,128 Total net assets$1,348,257$9,589,937 The accompanying notes are an integral part of these financial statements. 44 Exhibit A-6 Governmental Activities - Business-Type Activities - Enterprise Funds Internal Service Funds Totals SewerStorm Water 20072006 $2,593,674$620,783$5,496,636$6,127,631$3,729,450 977,198104,1561,819,6171,595,037 - - 8181158 - - 12,69617,44623,014 - - - - - 269 3,952 - 3,952 - - - - 635,854748,893 - 249,750 - 249,750226,307 - 3,824,574 737,716 8,223,336 8,721,040 3,729,719 - - 306,477306,477 - 8,770 - 3,246,4013,246,401 - 2,152,7901,872,81811,118,29111,067,152 - 914,97429,1252,797,9152,692,5111,349,969 6,639,5826,982,93522,262,77722,058,791 - 9,716,116 8,884,878 39,731,861 39,371,332 1,349,969 (5,287,505)(4,091,416)(19,769,721)(18,601,165)(1,095,268) 4,428,6114,793,46219,962,14020,770,167254,701 4,428,6114,793,46219,962,14020,770,167254,701 8,253,1855,531,17828,185,47629,491,2073,984,420 19,38220,395355,229364,2504,937 - - 44,53049,926 - - - - 2,221 - - - 67,136322,920 - 9,237 - 33,98326,297 - - - - - 87,956 - - - - 728,858 - - 300,000405,000 - 28,619 20,395 800,878 1,170,614 821,751 - - - - 115,138 - - 2,711,0553,010,546 - 0 0 2,711,055 3,010,546 115,138 28,61920,3953,511,9334,181,160936,889 4,428,6114,793,46216,951,08517,354,621254,701 3,795,955717,3217,722,4587,955,4262,792,830 $8,224,566$5,510,783$24,673,543$25,310,047$3,047,531 The accompanying notes are an integral part of these financial statements. 45 CITY OF FRIDLEY, MINNESOT A STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND NET ASSETS PROPRIETARY FUNDS For The Year Ended December 31, 2007 Business-Type Activities - Enterprise Funds LiquorWater Sales$5,252,910$ - Cost of sales(4,000,159) - Gross profit1,252,7510 Operating revenues: Customer billings - 1,980,497 Charges for services - 7,578 Other revenues - 1,972 Total operating revenues0 1,990,047 Total gross profit and operating revenues1,252,751 1,990,047 Operating expenses: Personal services510,107691,011 Supplies and other charges: Disposal charges - - Other359,971858,058 Depreciation50,274621,614 Total operating expenses920,352 2,170,683 Operating income (loss)332,399 (180,636) Nonoperating revenues (expenses): Intergovernmental revenue - - Investment income9,22081,071 Insurance reimbursement - - Interest expense - (108,351) Special assessments - - Gain (loss) on disposal of capital assets - 1,278 Total nonoperating revenues (expenses)9,220 (26,002) Income (loss) before transfers341,619 (206,638) Transfers: Transfers out(500,000) - Change in net assets(158,381)(206,638) Net assets - January 1 1,506,6389,796,575 Net assets - December 31$1,348,257$9,589,937 The accompanying notes are an integral part of these financial statements. 4444466666 46 Exhibit A-7 Governmental Activities - Business-Type Activities - Enterprise Funds Internal Service Funds SewerStorm WaterTotals 20072006 $ - $ - $5,252,910$5,136,029$ - - - (4,000,159)(3,926,720) - 001,252,7511,209,3090 3,461,615390,7925,832,9045,648,720 - - - 7,5787,578216,001 - - 1,9729,324 - 3,461,615 390,792 5,842,454 5,665,622 216,001 3,461,615 390,792 7,095,205 6,874,931 216,001 597,978106,4001,905,4961,794,05371,197 2,732,511 - 2,732,5112,615,93663,725 159,53164,2661,441,8261,295,172 - 308,033211,1701,191,0911,139,145148,319 3,798,053 381,836 7,270,924 6,844,306 283,241 (336,438)8,956 (175,719)30,625 (67,240) - - - 514 - 124,40430,477245,172281,316170,332 - - - - 72,481 - (108)(108,459)(121,164) - - 1,2241,224 - - - - 1,2785,0001,125 124,404 31,593 139,215 165,666 243,938 (212,034)40,549 (36,504)196,291 176,698 - (100,000)(600,000)(600,000) - (212,034)(59,451)(636,504)(403,709)176,698 8,436,6005,570,23425,310,04725,713,7562,870,833 $8,224,566$5,510,783$24,673,543$25,310,047$3,047,531 The accompanying notes are an integral part of these financial statements. 4444477777 47 CITY OF FRIDLEY, MINNESOTA STATEMENT OF CASH FLOWS PROPRIETARY FUNDS For The Year Ended December 31, 2007 Business-Type Activities - Enterprise Funds LiquorWater Cash flows from operating activities: Receipts from customers and users$5,252,910$1,912,605 Receipts from interfund services provided - - Payment to suppliers(4,290,967)(865,263) Payment to employees(508,040)(687,426) Net cash flows from operating activities453,903359,916 Cash flows from noncapital financing activities: Intergovernmental revenue - - Transfers out(500,000) - Special assessment collections - (1,864) Net cash flows from noncapital financing activities(500,000)(1,864) Cash flows from capital and related financing activities: Acquisition of capital assets - (180,282) Insurance reimbursement - - Principal paid on revenue bonds - (305,000) Interest and paying agent fees on revenue bonds - (112,346) Proceeds from sale of capital assets - 1,278 Net cash flows from capital and related financing activities0(596,350) Cash flows from investing activities: Investment income9,22081,071 Net increase (decrease) in cash and cash equivalents(36,877)(157,227) Cash and cash equivalents - January 1566,5361,909,747 Cash and cash equivalents - December 31$529,659 $1,752,520 Reconciliation of operating income (loss) to net cash provided (used) by operating activities: Operating income (loss) $332,399($180,636) Adjustments to reconcile operating income (loss) to net cash flows from operating activities: Depreciation50,274621,614 Changes in assets and liabilities: Decrease (increase) in receivables - (77,442) Decrease (increase) in prepaid items - - Decrease (increase) in inventories109,8643,175 Increase (decrease) in payables(38,634)(6,795) Total adjustments121,504 540,552 Net cash provided by operating activities$453,903$359,916 The accompanying notes are an integral part of these financial statements. 48 Exhibit A-8 Governmental Activities - Business-Type Activities - Enterprise Funds Internal Service Funds SewerStorm Water Totals 20072006 $3,312,053$393,293$10,870,861$10,738,642$ - (3,952) - (3,952) - 216,164 (3,151,717)(43,979)(8,351,926)(7,980,724)(82,401) (595,944)(106,400)(1,897,810)(1,792,978)(25,084) (439,560)242,914617,173964,940108,679 - - - 514 - - (100,000)(600,000)(600,000) - - 8,6566,792 - - 0(91,344)(593,208)(599,486)0 (104,773)(98,009)(383,064)(1,644,301)(77,111) - - - - 72,481 - (100,000)(405,000)(395,000) - - (1,000)(113,346)(126,024) - - - 1,2785,0001,125 (104,773)(199,009)(900,132)(2,160,325)(3,505) 124,40430,477245,172281,316170,332 (419,929)(16,962)(630,995)(1,513,555)275,506 3,013,603637,7456,127,6317,641,1863,453,944 $2,593,674$620,783$5,496,636 $6,127,631 $3,729,450 ($336,438)$8,956($175,719)$30,625($67,240) 308,033211,1701,191,0911,139,145148,319 (153,514)2,501(228,455)(63,009)163 (23,443) - (23,443)(9,479) - - - 113,039(151,467) - (234,198)20,287(259,340)19,12527,437 (103,122)233,958792,892 934,315 175,919 ($439,560)$242,914$617,173$964,940$108,679 The accompanying notes are an integral part of these financial statements. 49 Exhibit A-9 CITY OF FRIDLEY, MINNESOTA STATEMENT OF FIDUCIARY NET ASSETS December 31, 2007 20072006 Assets: Cash and investments$31,607$30,203 Receivables: Accounts2,0982,429 Taxes: Unremitted3435 Delinquent163119 Total assets$33,902$32,786 Liabilities: Due to other governments$33,902$32,786 The accompanying notes are an integral part of these financial statements. 5502 555555000000 50 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2007 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 assets and the statement of changes in net assets) 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. Separate financial statements are provided for governmental funds, proprietary funds, and fiduciary funds, even though the latter are excluded from the government-wide financial 5555511111 51 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2007 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. Thegrant management special revenue fund administers grants received from a variety of intergovernmental agencies. 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. Thespecial assessment 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. Thetax increment debt service fund services the debt of the tax increment bonds. Tax increment money is used to service the debt on redevelopment related bonds. Thespecial assessment construction capital projects fund is used to account for the construction of public improvements, such as residential streets, sidewalks, and storm 5555522222 52 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2007 sewers or for the provision of services that are to be paid primarily by the benefited property owner. Thecapital 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: Theliquor fund accounts for operations of the municipal liquor stores. Thewater fund accounts for the water service charges which are used to finance the water system operating expenses. Thesewer fund accounts for the sewer service charges which are used to finance the sanitary sewer system operating expenses. Thestorm 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. Private-sector standards of accounting and financial reporting issued prior to December 1, 1989, generally are followed in both the government-wide and proprietary-fund financial statements to the extent that those standards do not conflict with or contradict guidance of the Governmental Accounting Standards Board. Governments also have the option of following subsequent private-sector guidance for their business-type activities and enterprise funds, subject to this same limitation. The government has elected not to follow subsequent private-sector guidance. 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. 5555533333 53 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2007 Proprietary funds distinguish operatingrevenues 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. 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. 5555544444 54 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2007 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. 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. Cash and investments held by escrow agent include balances held in segregated accounts that are established for specific purposes. 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, 2007 are planned to be eliminated in 2008. Any residual balances outstanding between the governmental activities and business-type activities are reported in the government-wide financial statements as “internal balances.” 5555555555 55 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2007 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. 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. I. Market Value Homestead Credit Property taxes on residential agricultural homestead property (as defined by State Statutes) are partially reduced by market value homestead credit (MVHC). This credit is paid to the City by the State in lieu of taxes levied against homestead property. The State remits this credit through installments each year. The credit is recognized as revenue by the City at the time of collection. J. 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. 5555566666 56 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2007 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. K. 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). L. 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. M. Capital Assets Capital assets, which include property, plant, equipment and infrastructure assets (e.g., roads, bridges, sidewalks, and similar items), 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 5555577777 57 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2007 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, 2007, 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 N. 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. O. 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. 5555588888 58 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2007 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. P. Fund Equity In the fund financial statements, governmental funds report reservations of fund balance for amounts not appropriable for expenditure or legally segregated for a specific future use. Designated fund balances represent tentative plans for future use of financial resources. Q. 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. R. 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. S. 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 assets The governmental fund balance sheet includes reconciliation between fund balance – total governmental funds and net assets – governmental activities as reported in the government- wide statement of net assets. 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 $11,351,176 difference are as follows: Bonds payable$11,175,000 Accrued interest payable176,176 Net adjustment to increase net changes in fund balances - total governmental funds to arrive at changes in net assets of governmental activities$11,351,176 5555599999 59 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2007 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 assets 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 $1,435,868 difference are as follows: Loss on disposal of capital assets($3,682) Capital outlay3,123,524 Depreciation expense(1,683,974) Net adjustment to increase net changes in fund balances - total governmental funds to arrive at changes in net assets of governmental activities$1,435,868 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 $192,534 difference are as follows: General property taxes deferred revenue: At December 31, 2006($150,698) At December 31, 2007209,659 Special assessments deferred revenue: At December 31, 2006(1,635,814) At December 31, 20071,769,387 Net adjustments to increase net changes in fund balances - total governmental funds to arrive at changes in net assets of governmental activities$192,534 6666600000 60 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2007 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 assets. The details of this ($85,000) difference are as follows: Debt issued: Improvement bonds($1,910,000) Principal repayments: G.O. Improvement bonds155,000 Tax increment bonds1,670,000 Net adjustment to decrease net changes in fund balances - total governmental funds to arrive at changes in net assets of governmental activities($85,000) T. Reclassifications Certain amounts presented in the prior year data have been reclassified in order to be consistent with the current year’s presentation. 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. 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; 6666611111 61 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2007 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, 2007, the bank balance of he City’s deposits was covered by federal depository insurance or covered by 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. 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. 6666622222 62 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2007 As of December 31, 2007 the City had the following investments and maturities: Investment Maturities (in Years) FairLessOver Investment TypeRatingValueThan 11-56-1010 Years Federal Home Loan Mortgage Co.AAA$993,110$ - $993,110$ - $ - Federal Home Loan BankAAA6,004,0754,009,6951,994,380 - - Farmer Mac MTNAAA1,000,510 - 1,000,510 - - Money marketN/A20,774,80720,774,807 - - - Total$28,772,502$24,784,502$3,988,000$0$0 Total investments$28,772,502 Deposits316,603 Petty cash4,550 Total cash and investments$29,093,655 As of December 31, 2007 the HRA had the following investments and maturities: Investment Maturities (in Years) FairLessOver Investment TypeRatingValueThan 11-56-1010 Years United States Treasury BondAAA$131,327$ - $ - $ - $131,327 Federal Home Loan Mortgage CoAAA1,990,4731,990,473 - - - Money marketN/A14,207,22914,207,229 - - - Total$16,329,029$16,197,702$0$0$131,327 Total investments$16,329,029 Deposits11,717 Total cash and investments$16,340,746 C. Investment Risks The City’s investment policy is to follow Minnesota State Statutes as described above which reduces the City’s exposure to credit, custodial credit, and interest rate risks. Specific risk information for the City is as follows: – For investments, custodial credit risk is the risk that in the Custodial credit risk - investments vent of a failure of the counterparty, the City will not be able to recover the value of its investments that are in the possession of an outside party. As of December 31, 2007, all investments of the City were insured, registered and held by the City or its agent in the City’s name. – The City’s investment policy requires the City to diversify its investment Interest rate risk 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. – State law limits investments in commercial paper to the top rating issued by at least Credit risk two of the nationally recognized statistical rating organizations. State law also limits investments in money market funds to those that meet the conditions of SEC rule 2a-7 and rated in one of the 6666633333 63 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2007 two highest rating categories by at least one NRSRO. The City invests in a Credit-Suisse money market fund which is managed pursuant to the requirements of Rule 2a-7 and seeks to maintain a one dollar share price. As of December 31, 2007, the City’s investments in the FHLMC and FHLB notes were all rated AAA by Standard and Poor’s. Concentration of credit risk – The City places no limit on the amount the City may invest in any one issuer. More than 5% of the City’s investments are in various holdings as follows: Federal Home Loan Bank 21% Money market 72% Concentration of credit risk – The HRA places no limit on the amount the HRA may invest in any one issuer. More than 5% of the HRA’s investments are in various holdings as follows: Federal Home Loan Mortgage 12% Money market 87% 3. Receivables Significant receivables balances not expected to be collected within one year of December 31, 2007 are as follows: Primary Government Major Funds Special AssessmentCapital Nonmajor GeneralDebt ServiceImprovementsFundsTotal Special assessments receivable$35,590$1,166,805$ - $72,014$1,274,409 Loans receivable - 277,560 - - 277,560 Delinquent property taxes75,852 - 9265,92282,700 $111,442$1,444,365$926$77,936$1,634,669 HRA Component Unit Major Funds RevolvingNorth LoanAreaTotal Mortgage receivable$1,072,144$43,255$1,115,399 Allowance for uncollectible accounts(44,900) - (44,900) $1,027,244$43,255$1,070,499 6666644444 64 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2007 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: UnavailableUnearnedTotal Delinquent property taxes receivable (General Fund)$192,832$ - $192,832 Delinquent property taxes receivable (Capital Improvements Fund)2,362 - 2,362 Delinquent property taxes receivable (Special Assessment Debt Service Fund)6,754 - 6,754 Delinquent property taxes receivable (Nonmajor Funds)7,712 - 7,712 Special assessments not yet due (General Fund)49,407 - 49,407 Special assessments not yet due (Special Assessment Construction Fund)99,971 - 99,971 Special assessments not yet due (Special Assessment Debt Service Fund)1,620,009 - 1,620,009 Unearned grant funds (Grant Management Fund) - 119,784119,784 Total deferred/unearned revenue for governmental funds$1,979,047$119,784$2,098,831 4. Capital Assets Capital asset activity for the year ended December 31, 2007 was as follows: BeginningEnding Primary Government BalanceIncreasesDecreasesBalance Governmental activities: Capital assets, not being depreciated: Land$2,841,516$ - $ - $2,841,516 Construction in progress209,17726,607(131,818)103,966 Total capital assets, not being depreciated3,050,69326,607(131,818)2,945,482 Capital assets, being depreciated: Buildings and structures7,924,991 - - 7,924,991 Machinery and equipment8,297,037553,822(615,722)8,235,137 Improvements4,137,090233,750(23,275)4,347,565 Infrastructure29,358,3142,518,391(347,717)31,528,988 Total capital assets, being depreciated49,717,4323,305,963(986,714)52,036,681 Less accumulated depreciation for: Buildings and structures4,759,945299,371 - 5,059,316 Machinery and equipment5,883,231588,857(615,605)5,856,483 Improvements3,096,616181,886(23,275)3,255,227 Infrastructure16,082,728762,179(344,035)16,500,872 Total accumulated depreciation29,822,5201,832,293(982,915)30,671,898 Total capital assets being depreciated - net19,894,9121,473,670(3,799)21,364,783 Governmental activities capital assets - net$22,945,605$1,500,277($135,617)$24,310,265 6666655555 65 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2007 BeginningEnding Primary Government BalanceIncreasesDecreasesBalance Business-type activities: Capital assets, not being depreciated: Land$306,477$ - $ - $306,477 Total capital assets, not being depreciated306,47700306,477 Capital assets, being depreciated: Buildings and structures3,246,401 - - 3,246,401 Improvements other than buildings11,067,15273,674(22,535)11,118,291 Machinery and equipment2,692,511105,404 - 2,797,915 Infrastructure22,058,791203,986 - 22,262,777 Total capital assets, being depreciated39,064,855383,064(22,535)39,425,384 Less accumulated depreciation for: Buildings and structures1,254,91386,634 - 1,341,547 Improvements other than buildings4,968,813436,700(22,535)5,382,978 Machinery and equipment1,956,945166,901 - 2,123,846 Infrastructure10,420,494500,856 - 10,921,350 Total accumulated depreciation18,601,1651,191,091(22,535)19,769,721 Total capital assets being depreciated - net20,463,690(808,027)019,655,663 Business-type activities capital assets - net$20,770,167($808,027)$0$19,962,140 Depreciation expense was charged to functions/programs of the primary government as follows: Governmental activities: General government$167,976 Public safety233,286 Public works, including depreciation of general infrastructure assets1,169,865 Community development1,228 Recreation and naturalist111,619 Capital assets held by the government's internal service funds are charged to the various functions based on their usage of the assets148,319 Total depreciation expense - governmental activities$1,832,293 Business-type activities: Liquor$50,274 Water621,614 Sewer308,033 Storm water211,170 Total increases in accumulated depreciation$1,191,091 6666666666 66 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2007 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, 2007, the governmental long-term bonded debt and loans of the financial reporting entity consisted of the following: Governmental Activities: $1,910,000 General Obligation Improvement Bonds, Series 2007A due in varying annual installments of $155,000 - $230,000 through August 1, 2018 interest at 3.5% - 3.85%.$1,910,000 $3,920,000 General Obligation Tax Increment Refunding Bonds of 2004 due in varying annual installments of $230,000 - $605,000 through February 1, 2012; interest at 2.00% - 4.35% February 1, 2012; interest at 5.10% - 5.65%.2,740,000 $1,805,000 General Obligation Improvement Bonds of 2005 due in varying annual installments of $155,000 - $210,000 through February 1, 2016; interest at 2.80% - 3.750%.1,650,000 $4,645,000 General Obligation Tax Increment Refunding Bonds of 2005 due in varying annual installments of $1,090,000 - $1,160,000 through February 1, 2009; interest at 8.00%.2,370,000 $2,505,000 General Obligation Improvement Bonds of 2006 due in varying annual installments of $205,000 - $305,000 through February 1, 2017; interest at 4.00%.2,505,000 Subtotal governmental activities11,175,000 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.$490,000 $1,790,000 General Obligation Water Revenue Bonds of 2004 due in varying annual installments of $50,000 - $230,000 through February 1, 2019; interest at 2.5% - 4.00%.1,790,000 $1,205,000 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 2.0% - 3.25%.735,000 Unamortized discount(3,945) Subtotal business-type activities3,011,055 Total primary government$14,186,055 Component Units: $1,500,000 loan payable to primary government. Due in annual installments of $87,429, through February 1, 2012; interest at 5%.$348,441 6666677777 67 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2007 Annual debt service requirements to maturity for general obligation bonds and loans are as follows: Primary GovernmentComponent Unit Governmental ActivitiesBusiness-Type ActivitiesHRA Year EndingG.O. ImprovementTax IncrementRevenue BondsLoan Payable December 31,PrincipalInterestPrincipalInterestPrincipalInterestPrincipalInterest 2008$365,000$230,325$1,710,000$149,015$300,000$101,943$70,882$16,547 2009535,000203,5051,680,00096,495315,00091,72674,47012,959 2010560,000183,911545,00059,906320,00080,75678,2409,188 2011575,000163,301570,00038,003330,00068,95582,2015,227 2012605,000141,659605,00013,159345,00057,22942,6481,066 2013630,000118,813 - - 175,00048,779 - - 2014655,00094,785 - - 185,00042,836 - - 2015675,00069,615 - - 190,00036,413 - - 2016710,00043,090 - - 200,00029,388 - - 2017525,00019,135 - - 205,00021,844 - - 2018230,0004,428 - - 220,00013,600 - - 2019 - - - - 230,0004,600 - - Total$6,065,000$1,272,567$5,110,000$356,578$3,015,000$598,067$348,441$44,987 Long-term liability activity for the year ended December 31, 2007, was as follows: BeginningEndingDue Within BalanceAdditionsReductionsBalanceOne Year Governmental activities: Bonds payable: G.O. improvement bonds$4,310,000$1,910,000($155,000)$6,065,000$365,000 Tax increment bonds6,780,000 - (1,670,000)5,110,0001,710,000 Total bonds payable11,090,0001,910,000(1,825,000)11,175,0002,075,000 Compensated absences804,961720,905(681,870)843,996728,858 Total government activity long-term debt$11,894,961$2,630,905($2,506,870)$12,018,996$2,803,858 Business-type activities: Bonds payable: G.O. revenue bonds$3,420,000$ - ($405,000)$3,015,000$300,000 Component units: Loan payable$415,908$ - ($67,467)$348,441$70,882 Compensated absences are generally liquidated by the General Fund. The loan payable is liquidated by the HRA Revolving Loan Fund. All long-term bonded indebtedness outstanding at December 31, 2007 is backed by the full faith and credit of the City, including improvement and revenue bond issues. Delinquent assessments receivable at December 31, 2007 totaled $12,115. 6666688888 68 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2007 Revenues Pledged Revenue PledgedCurrent Year Percent ofDebt serviceRemainingPrincipalPledged Use oftotalas a % ofTerm ofPrincipaland InterestRevenue Bond IssueProceedsTypedebt servicenet revenuesPledgeand Interestpaidreceived 2007AStreet ImprovementsProperty Taxes and100%2007-$2,372,002$81,062$246,328 Special Assessments2018 2006AStreet ImprovementsProperty Taxes and100%2007-3,143,770301,100276,415 Special Assessments2017 2005BStreet ImprovementsProperty Taxes and100%2006-2,203,783213,163254,941 Special Assessments2016 Refunded bonds of 1997A 2005Ainitial project was for Tax Increment100%2006-2,440,3501,273,8751,273,875 redevelopment2009 Refunded bonds of 1998B 2004initial project was for Tax Increment100%2005-3,026,228595,613595,613 land acquisition2012 2004 Water Revenue BondsInfrastructure improvementsWater Customer100%3.17%2004-2,284,12863,1351,990,047 Net Revenue2019 2004 Water & Storm RevenueInfrastructure improvementsWater and Storm 100%10.85%2004-791,516258,2192,380,839 BondsCustomer Net Revenue2012 1998A Water Revenue BondsInfrastructure improvementsWater Customer100%7.06%1998-537,424140,4261,990,047 Net Revenue2011 6. Defined Benefit Pension Plans-Statewide A. Plan Description All full-time and certain part-time employees of the City of Fridley are covered by defined benefit plans administered by the Public Employees Retirement Association of Minnesota (PERA). PERA administers the Public Employees Retirement Fund (PERF) 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 Statute, Chapters 353 and 356. PERF 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. PERA issues a publicly available financial report that includes financial statements and required supplementary information for PERF and PEPFF. That report may be obtained on the web at 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. 6699 69 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2007 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. PERF Basic Plan members and Coordinated Plan members were required to contribute 9.10% and 5.75%, respectively, of their annual covered salary. Contribution rates in the Coordinated Plan will increase in 2008 to 6%. PEPFF members were required to contribute 7.8% of their annual covered salary in 2007. That rate will increase to 8.6% in 2008. The City of Fridley, Minnesota is required to contribute the following percentages of annual covered payroll: 11.78% for Basic Plan PERF members, 6.25% for Coordinated Plan PERF members, and 11.7% for PEPFF members. Employer contribution rates for the Coordinated Plan and PEPFF will increase to 6.5% and 12.9% respectively, effective January 1, 2008. The City’s contributions for the years ending December 31, 2007, 2006 and 2005 equal to the contractually required contributions for each year as set by state statute for PERF and PEPFF as follows: PERFPEPFF 2005$257,111$271,444 2006283,926321,681 2007315,035371,932 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. Plan benefits depend solely on amounts contributed to the plan plus investment income, less administrative expenses. Minnesota Statutes, Chapter 353D.03, specifies 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 four-tenths of one percent of the assets in each member's account. 7777700000 70 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2007 Total contributions made by the City during fiscal year 2007 were: Percentage of AmountCovered PayrollRequired EmployeesEmployerEmployeesEmployerRates PEDCP$2,045$2,0455.00%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 $144,649 and $169,765 in State Aid to the Association for 2007 and 2006, respectively. During 2007 and as of December 31, 2007, the Association held no securities issued by the City or other related parties. 7777711111 71 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2007 8. 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 HRA component unit at December 31, 2007 are as follows: InterfundInterfund ReceivablesPayables Due From/Due To: General Fund$3,313,825$ - Capital Projects Funds: Lake Pointe - 785,303 Gateway East - 894,653 Gateway West - 1,469,109 57th Avenue Redevelopment - 124,760 Tax Increment District #19 - 40,000 $3,313,825$3,313,825 The above balances are not expected to be eliminated within one year of December 31, 2007. Interfund Transfers: Transfer InTransfer Out Governmental Funds: Major Funds: General Fund$1,921,127$ - Special Assessment Debt Service - 361,823 Capital Improvements - 2,482,916 Special Assessment Construction Capital Projects2,694,739981,127 Nonmajor Funds - 190,000 Total governmental funds4,615,8664,015,866 Proprietary Funds: Enterprise: Liquor - 500,000 Storm Water - 100,000 Total proprietary funds0600,000 Total$4,615,866$4,615,866 Interfund transfers allow the City to allocate financial resources to the funds that receive benefit from services provided by another fund. Most of the City’s interfund transfers fall under that category. 7777722222 72 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2007 9. Reserved Fund Balances The following reservations have been made of various fund balances of the primary government at December 31, 2007: General Fund: Reserved for: Inventory$56,346 Long-term receivables9,182 Total General Fund65,528 Special Revenue Funds: Reserved for police activity20,726 Debt Service Funds: Reserved for long-term receivable348,441 Reserved for debt service1,214,519 Total Debt Service Funds1,562,960 Total Governmental Funds$1,649,214 The HRA component unit had reserved fund balances at December 31, 2007: Reserved for: Debt service$3,000,000 Mortgage receivable1,115,399 $4,115,399 7777733333 73 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2007 10. Designated Fund Balance The following designations have been made of various fund balances at December 31, 2007: General Fund: Working capital$5,206,778 Special Revenue Funds: Cable TV Fund: Cable TV operations1,007,603 Drug and Gambling Forfeiture Fund: Drug and gambling enforcement33,817 Spring Brook Nature Fund: Nature Center67,895 F.C.C. Donations: Fridley community center83,581 Total Special Revenue Funds1,192,896 Capital Projects Funds: Capital Improvements Fund: Future improvements5,105,204 Total of designated fund balances$11,504,878 7777744444 74 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2007 11. Tax Increment Districts The HRA is the administering authority for the following Tax Increment Districts: FiscalRetained YearTax Capacity ValuesDisparityBy EstablishedDistrictDistrict NameCurrentOriginalCapturedAdjustmentsAuthority 19791Center City$740,181$119,311$620,870$ - $620,870 19812Moore Lake629,50533,690595,815 - 595,815 19823North Area1,774,57090,3461,684,224 - 1,684,224 19856Lake Pointe871,52283,780787,742 - 787,742 19867Winfield71,3683,58267,786 - 67,786 19899Onan/Old Central Avenue414,21542,646371,569 - 371,569 199211University/Osborne72,95626,47846,478 - 46,478 199212McGlynn's79,47641,25438,222 - 38,222 199513Satellite Lane Apartments57,5422,33455,208 - 55,208 19971657th Avenue Replacement32,7627,77624,986 - 24,986 200017Gateway East53,8435,04248,801 - 48,801 200718Gateway West - - - - - 1995HR1/04Housing Replacement6,2965435,753 - 5,753 1995HR1/05Housing Replacement2,5452702,275 - 2,275 1995HR1/06Housing Replacement6,3596865,673 - 5,673 1995HR1/Q2Housing Replacement2,4483182,130 - 2,130 1995HR1/Q3Housing Replacement2,1243931,731 - 1,731 1995HR1/Q4Housing Replacement6,8657816,084 - 6,084 1995HR1/S3Housing Replacement2,5795162,063 - 2,063 1995HR1/S4Housing Replacement2,6995632,136 - 2,136 1995HR1/S5Housing Replacement2,3073751,932 - 1,932 1995HR1/S6Housing Replacement2,0644431,621 - 1,621 1995HR1/T7Housing Replacement2,1356401,4951,495 Totals$4,836,361$461,767$4,374,594$0$4,374,594 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. The Self Insurance Fund provides coverage for up to a maximum of $50,000 for each liability and property claim with an annual aggregate of $100,000 for all claims. The City purchases insurance through the League of Minnesota Cities Insurance Trust for claims in excess of coverage provided by the fund and for all other 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 $500 deductible. The City’s workers compensation coverage is retrospectively rated. With this type of coverage, final premiums are determined after loss experience is known. The amount of premium adjustment, if any, is considered immaterial and not recorded until received or paid. 7777755555 75 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2007 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, 2007, the Self Insurance Fund has accumulated equity in the amount of $1,741,390 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, 2007. 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. 7777766666 76 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2007 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, 2007 is as follows: Original 12/31/07InterestMaturity NotePrincipalBalanceRateDate Medtronic$10,000,000$8,955,8066.75%August 1, 2025 Linn175,000139,8118.50%February 1, 2012 F. Construction Commitments At December 31, 2007, the City had construction project contracts in progress. The commitments related to the remaining contract balances are summarized as follows: Remaining ProjectCommitment 85th Avenue Trail Project$72,680 G. Commitments - HRA The HRA has pledged future tax increments to the City of Fridley, Minnesota for the City’s general obligation tax increment debt. 7777777777 77 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2007 13. Leases A. Lease Expense The City leases space for one of its liquor stores. Total costs for this lease was $104,759 for the year ended December 31, 2007. The future minimum lease payments for this lease are as follows: Year Ending December 31,Amount 2008$95,850 200998,200 2010109,981 2011109,981 2012109,981 2013109,981 201491,650 Total$725,624 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 (of the lessees) necessary to provide radio communications. For accounting purposes, the leases are considered operating leases. Lease revenue for the year ended December 31, 2007, totaled $103,031. Terms of each lease are as follows: Annual Lease AdjustmentExpirationRenewal LesseeFactor*DateOptions T-MobileGreater of 3% or CPI12/31/111 Five Year Renewal T-Mobile Highway 65Greater of 3% or CPI12/31/122 Five Year Renewals T-Mobile - Marion HillsGreater of 2% or CPI up to 5%10/30/124 Five Year Renewals Cingular - GarageGreater of 5% or CPI08/25/084 Five Year Renewals Cingular - Marion HillsGreater of 5% or CPI06/30/103 Five Year Renewals Sprint - Highway 65Greater of 5% or CPI09/30/103 Five Year Renewals Sprint - Well #13Greater of 5% or CPI09/30/083 Five Year Renewals *Amounts for future lease receipts are unavailable because they are based on the Consumer Price Index. 7777788888 78 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2007 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, 2007, there were 28 series of Industrial Revenue Bonds issued. The aggregate principal amount payable for the six series issued after July 1, 1995 is $18,952,976. 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. 15. Deficit Fund Balances At December 31, 2007, individual funds with a deficit fund balance are as follows: Primary government: Solid Waste Abatement$3,756 Component unit: Lake Pointe$747,480 Gateway East866,624 Gateway West1,466,196 57th Avenue Redevelopment128,004 Tax Increment District #1933,058 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. 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. 7777799999 79 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2007 17. Recently Issued Accounting Standards The Governmental Accounting Standards Boards (GASB) recently approved the following statements which were not implemented for these financial statements: Statement No. 45 Accounting and Financial Reporting by Employers for Post Employment Benefits Other Than Pension Plans.Implementation is required in three phases based on a government’s total annual revenues in the first fiscal year ending after June 15, 1999. This Statement is effective for periods beginning after December 15, 2006, for phase 1 governments (those with total annual revenues of $100 million or more); after December 15, 2007, for phase 2 governments (those with total annual revenues of $10 million or more but less than $100 million); and after December 15, 2008, for phase 3 governments (those with total annual revenues of less than $10 million). Early implementation is encouraged. Statement No. 49 Accounting and Financial Reporting for Pollution Remediation Obligation. The provisions of this Statement are effective for financial statements for periods beginning after December 15, 2007. Statement No. 50 Pension Disclosures – an amendment of GASB Statements No. 25 and No. 27. The provisions of this Statement are effective for financial statements for periods beginning after June 15, 2007. Statement No. 51 Accounting and Financial Reporting for Intangible Assets.The provisions of this Statement are effective for financial statements for periods beginning after June 15, 2009. The effect these standards may have on future financial statements is not determinable at this time. 8888800000 80 REQUIRED SUPPLEMENTARY INFORMATION 8813 888888111111 81 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, 2007 With comparative actual amounts for the year ended December 31, 2006 2007 Variance with Final Budget - 2006 Budgeted AmountsActualPositiveActual OriginalFinalAmounts(Negative)Amounts Revenues: Taxes and special assessments: Current ad valorem taxes$8,432,907$8,009,798$8,119,621109,823$7,552,898 Delinquent ad valorem taxes30,00030,00070,33540,33591,653 Penalties and interest8,0008,0007,896(104)7,516 Special assessments4,0004,00026,64422,64414,435 Total taxes and special assessments8,474,9078,051,7988,224,496172,6987,666,502 Licenses and permits: Licenses: Rental75,00075,00081,0086,00887,307 Business85,50085,500104,65919,15981,137 All other29,00029,00029,34534530,975 Permits476,900476,900663,411186,511483,808 Total licenses and permits666,400666,400878,423212,023683,227 Intergovernmental revenue: Federal grants8,50035,47739,4954,01845,624 State maintenance aid190,000190,000199,4209,420208,434 State credits - 423,109423,109 - 473,142 Local government aid382,341382,341382,341 - - Other state grants - 1,19834,00632,80879,627 Police and fire pension417,972456,000465,0349,034483,758 Other58,00058,00063,5415,54161,690 Total intergovernmental revenue1,056,8131,546,1251,606,94660,8211,352,275 Charges for services: General government943,490943,490951,9248,434934,373 Public safety159,500216,204212,279(3,925)162,068 Public works10,00010,40026,97016,57019,008 Community development22,70022,70016,816(5,884)10,001 Recreation233,000238,997282,24343,246253,489 Total charges for services1,368,6901,431,7911,490,23258,4411,378,939 Fines and forfeits180,000180,000275,43195,431256,435 Investment income124,000124,000204,26080,260173,716 Miscellaneous revenue: Insurance and other reimbursements93,50095,21371,973(23,240)60,049 Gambling tax70,00070,00080,99310,99374,166 Donations3,00015,05419,3334,27928,663 Miscellaneous64,00064,57368,1323,55912,601 Total miscellaneous revenue230,500244,840240,431(4,409)175,479 Total revenues12,101,310 12,244,954 12,920,219 675,265 11,686,573 82 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, 2007 With comparative actual amounts for the year ended December 31, 2006 2007 Variance with Final Budget - 2006 Budgeted AmountsActualPositiveActual OriginalFinalAmounts(Negative)Amounts Expenditures: General government: Mayor and council: Personal services$88,059$88,059$83,152$4,907$79,961 Supplies and other charges33,34833,34830,0213,32730,064 Total mayor and council121,407121,407113,1738,234110,025 City manager: Personal services209,892215,398215,398 - 205,146 Supplies and other charges70,28764,78151,30813,47353,339 Total City manager280,179280,179266,70613,473258,485 Human resources: Personal services163,294169,589169,589 - 154,486 Supplies and other charges25,24121,06118,5142,54715,286 Total human resources188,535190,650188,1032,547169,772 Legal: Supplies and other charges386,604380,309356,94823,361394,580 Elections: Personal services - 1,3081,308 - 2,305 Supplies and other charges1,75012,10112,101 - 38,092 Total elections1,75013,40913,409040,397 Accounting: Personal services654,292650,366616,78933,577615,013 Supplies and other charges86,72086,72082,3014,41981,459 Total accounting741,012737,086699,09037,996696,472 Assessing: Personal services172,334176,260176,260 - 165,051 Supplies and other charges9,3679,3677,8801,4878,593 Total assessing181,701185,627184,1401,487173,644 MIS: Personal services182,711182,711181,3931,318170,043 Supplies and other charges94,28694,28663,43430,85286,722 Total MIS276,997276,997244,82732,170256,765 City clerk/records: Personal services125,886124,578124,55325124,303 Supplies and other charges21,79621,79620,3911,40517,818 Total City clerk/records147,682146,374144,9441,430142,121 Nondepartmental: Personal services - 24,93424,934 - 12,373 Supplies and other charges50,00866,15466,154 - 52,039 Total nondepartmental50,00891,08891,088064,412 83 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, 2007 With comparative actual amounts for the year ended December 31, 2006 2007 Variance with Final Budget - 2006 Budgeted AmountsActualPositiveActual OriginalFinalAmounts(Negative)Amounts Expenditures: (continued) General government: (continued) Municipal center: Personal services$35,707$35,707$32,768$2,939$30,573 Supplies and other charges240,190256,093256,093 - 186,192 Total municipal center275,897291,800288,8612,939216,765 Total general government2,651,7722,714,9262,591,289123,6372,523,438 Expenditures: Public safety: Police: Personal services4,096,1874,169,4964,114,95254,5443,985,639 Supplies and other charges556,456596,281545,67750,604548,153 Total police4,652,6434,765,7774,660,629105,1484,533,792 Fire: Personal services982,4431,061,0071,061,007 - 968,644 Supplies and other charges173,742174,295159,85214,443159,379 Total fire1,156,1851,235,3021,220,85914,4431,128,023 Rental inspections: Personal services126,02472,52366,9425,581104,360 Supplies and other charges17,29817,29810,1037,1955,714 Total rental inspections143,32289,82177,04512,776110,074 Civil defense: Supplies and other charges21,24425,41419,5335,88124,432 Total public safety5,973,3946,116,3145,978,066138,2485,796,321 Public works: Engineering: Personal services449,640405,058405,058 - 408,613 Supplies and other charges74,51272,87270,0612,81168,423 Total engineering524,152477,930475,1192,811477,036 Public works and parks: Personal services1,607,3051,563,9411,551,39412,5471,482,217 Supplies and other charges910,6721,007,865998,6449,221985,658 Total public works and parks2,517,9772,571,8062,550,03821,7682,467,875 Total public works3,042,1293,049,7363,025,15724,5792,944,911 Community development: Building inspection: Personal services225,516225,516213,70711,809209,310 Supplies and other charges122,686134,619134,619 - 142,282 Total building inspection348,202360,135348,32611,809351,592 84 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, 2007 With comparative actual amounts for the year ended December 31, 2006 2007 Variance with Final Budget - 2006 Budgeted AmountsActualPositiveActual OriginalFinalAmounts(Negative)Amounts Expenditures: (continued) Community development: (continued) Planning: Personal services$329,051$349,070$349,070$ - $311,077 Supplies and other charges63,84063,84056,6907,15076,693 Total planning392,891412,910405,7607,150387,770 Total community development741,093773,045754,08618,959739,362 Parks and recreation: Personal services604,415576,098566,4239,675518,081 Supplies and other charges279,193288,233266,53121,702241,197 Total parks and recreation883,608864,331832,95431,377759,278 Contingency: Current: Supplies and other charges100,000 - - - - Capital outlay: Public safety185,860262,012260,4591,553167,242 Public works140,000136,540125,84110,699183,757 Culture and recreation - - - - 21,482 Total capital outlay325,860398,552386,30012,252372,481 Total expenditures13,717,85613,916,90413,567,852349,05213,135,791 Excess (deficiency) of revenues over (under) expenditures(1,616,546)(1,671,950)(647,633)1,024,317(1,449,218) Other financing sources (uses): Proceeds from sale of capital assets - - 58,31358,31310,054 Transfers in940,0001,921,1271,921,127 - 1,277,716 Total other financing sources (uses)940,0001,921,1271,979,44058,3131,287,770 Net change in fund balance($676,546)$249,1771,331,807$1,082,630(161,448) Fund balance - January 13,940,4994,101,947 Fund balance - December 31$5,272,306$3,940,499 85 Exhibit B-2 CITY OF FRIDLEY, MINNESOTA REQUIRED SUPPLEMENTARY INFORMATION BUDGETARY COMPARISON SCHEDULE - GRANT MANAGEMENT FUND For The Year Ended December 31, 2007 With comparative actual amounts for the year ended December 31, 2006 2007 Variance with Final Budget - 2006 Budgeted AmountsActualPositiveActual OriginalFinalAmounts(Negative)Amounts Revenues: Intergovernmental: Federal grants$92,547$92,547$107,429$14,882$221,984 State grants - 15,239 - (15,239)173,950 Total intergovernmental92,547 107,786 107,429 (357)395,934 Miscellaneous revenue: Donations - - 357357 - Total revenues92,547 107,786 107,786 0 395,934 Expenditures: Current: Community development: Personal services83,19192,21792,217 - 64,299 Supplies and other charges9,35615,56915,569 - 309,880 Recreation: Personal services - - - - 17,942 Supplies and other charges - - - - 3,813 Total expenditures92,547 107,786 107,786 0 395,934 Excess (deficiency) of revenues over (under) expenditures$0$00$00 Fund balance - January 1 - - Fund balance - December 31$0$0 888888666666 86 CITY OF FRIDLEY, MINNESOTA REQUIRED SUPPLEMENTARY INFORMATION BUDGETARY COMPARISON SCHEDULE NOTE TO RSI December 31, 2007 Note A BUDGETS The General Fund and Grant Management Fund budgets are 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. 8888877777 87 CITY OF FRIDLEY 8980 888888888888 88 COMBINING AND INDIVIDUAL FUND STATEMENTS AND SCHEDULES 8991 888888999999 89 CITY OF FRIDLEY 9902 999999000000 90 NONMAJOR GOVERNMENTAL FUNDS 9913 999999111111 91 CITY OF FRIDLEY 9924 999999222222 92 SPECIAL REVENUE FUNDS A Special Revenue Fund accounts for revenues derived from specific taxes or other earmarked revenue sources. They are usually required by statute or local ordinance and/or resolution to finance particular functions, activities or governments. 9935 999999333333 93 Exhibit C-1 CITY OF FRIDLEY, MINNESOTA BALANCE SHEET NONMAJOR GOVERNMENTAL FUNDS December 31, 2007 With comparative amounts for December 31, 2006 Nonmajor Special Revenue 20072006 Assets Cash and investments$1,171,210$1,245,251 Receivables: Accounts76,95474,541 Taxes9,0907,517 Due from component unit8,94113,606 Due from other governments37,84622,043 Total assets$1,304,041$1,362,958 Liabilities and Fund Balance Liabilities: Accounts payable$27,003$26,196 Due to other governments275985 Due to other funds50,84113,592 Salaries payable8,3446,557 Deferred revenue7,7125,874 Total liabilities94,17553,204 Fund balance (deficit): Reserved20,726203,131 Unreserved: Designated1,192,8961,106,623 Undesignated(3,756) - Total fund balance (deficit)1,209,8661,309,754 Total liabilities and fund balance$1,304,041$1,362,958 9999944444 94 Exhibit C-2 CITY OF FRIDLEY, MINNESOTA STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES NONMAJOR GOVERNMENTAL FUNDS For The Year Ended December 31, 2007 With comparative amounts for the year ended December 31, 2006 Nonmajor Special Revenue 20072006 Revenues: Licenses and permits$202,364$193,676 Intergovernmental revenue69,29285,611 Taxes288,502280,047 Charges for services333,414315,403 Fines and forfeits22,9285,100 Investment income56,03163,392 Miscellaneous134,205143,762 Total revenues1,106,736 1,086,991 Expenditures: Current: General government633,797607,692 Public safety21,49125,202 Naturalist361,336337,361 Capital outlay - 166,474 Total expenditures1,016,6241,136,729 Excess (deficiency) of revenues over (under) expenditures90,112 (49,738) Other financing sources (uses): Transfers out(190,000)(527,717) Transfers in - 100,000 Total other financing sources (uses)(190,000)(427,717) Net change in fund balance(99,888)(477,455) Fund balance - January 11,309,7541,787,209 Fund balance - December 31$1,209,866$1,309,754 9999955555 95 CITY OF FRIDLEY 9968 999999666666 96 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. 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 account for the residual assets refunded to the City from the Public Employees Retirement Association’s police consolidation account. Springbrook 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. 9979 999999777777 97 CITY OF FRIDLEY, MINNESOTA SUBCOMBINING BALANCE SHEET NONMAJOR SPECIAL REVENUE FUNDS December 31, 2007 With comparative totals for December 31, 2006 Solid Waste AssetsCable TVAbatement Cash and investments$958,136$ - Receivables: Accounts51,00724,631 Taxes - - Due from component unit - - Due from other governments - 37,846 Total assets$1,009,143$62,477 Liabilities and Fund Balance Liabilities: Accounts payable$ - $22,572 Due to other governments - 272 Due to other funds - 41,900 Salaries payable1,5401,489 Deferred revenue - - Total liabilities1,54066,233 Fund balance: Reserved for public safety - - Unreserved: Designated for special revenue programs1,007,603 - Undesignated - (3,756) Total fund balance1,007,603(3,756) Total liabilities and fund balance$1,009,143$62,477 98 98 Exhibit C-3 Drug and Springbrook HRAGamblingF.C.C.Nature Center Totals Nonmajor Special ReimbursementForfeitureDonationsPolice ActivityFund Revenue Funds 20072006 $ - $33,817$83,581$20,726$74,950$1,171,210$1,245,251 - - - - 1,31676,95474,541 - - - - 9,0909,0907,517 8,941 - - - - 8,94113,606 - - - - - 37,84622,043 $8,941$33,817$83,581$20,726$85,356$1,304,041$1,362,958 $ - $ - $ - $ - $4,431$27,003$26,196 - - - - 3275985 8,941 - - - - 50,84113,592 - - - - 5,3158,3446,557 - - - - 7,7127,7125,874 8,94100017,46194,17553,204 - - - 20,726 - 20,726203,131 - 33,81783,581 - 67,8951,192,8961,106,623 - - - - - (3,756) - 033,81783,58120,72667,8951,209,8661,309,754 $8,941$33,817$83,581$20,726$85,356$1,304,041$1,362,958 99 99 CITY OF FRIDLEY, MINNESOTA SUBCOMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE NONMAJOR SPECIAL REVENUE FUNDS For The Year Ended December 31, 2007 With comparative totals for the year ended December 31, 2006 Solid Waste Cable TVAbatement Revenues: Licenses and permits$202,364$ - Intergovernmental revenue - 48,950 Taxes - - Charges for services700247,347 Fines and forfeits - - Investment income43,546 - Miscellaneous1,516131,474 Total revenues248,126427,771 Expenditures: Current: General government131,087475,525 Public safety - - Naturalist - - Capital outlay - - Total expenditures131,087475,525 Excess (deficiency) of revenues over (under) expenditures117,039(47,754) Other financing sources (uses): Transfers out - - Transfers in - - Total other financing sources (uses)00 Net change in fund balance117,039(47,754) Fund balance - January 1890,56443,998 Fund balance - December 31$1,007,603($3,756) 111110000000000 100 Exhibit C-4 Drug and Springbrook HRAGamblingF.C.C.Nature Center Totals Nonmajor Special ReimbursementForfeitureDonationsPolice ActivityFund Revenue Funds 20072006 $ - $ - $ - $ - $ - $202,364$193,676 20,342 - - - - 69,29285,611 - - - - 288,502288,502280,047 - - - - 85,367333,414315,403 - 22,928 - - - 22,9285,100 - - 4,1117,59577956,03163,392 - - - - 1,215134,205143,762 20,34222,9284,1117,595375,8631,106,7361,086,991 20,342 - 6,843 - - 633,797607,692 - 21,491 - - - 21,49125,202 - - - - 361,336361,336337,361 - - - - - - 166,474 20,34221,4916,8430361,3361,016,6241,136,729 01,437(2,732)7,59514,52790,112(49,738) - - - (190,000) - (190,000)(527,717) - - - - - - 100,000 000(190,000)0(190,000)(427,717) 01,437(2,732)(182,405)14,527(99,888)(477,455) - 32,38086,313203,13153,3681,309,7541,787,209 $0$33,817$83,581$20,726$67,895$1,209,866$1,309,754 111110000011111 101 Exhibit D-1 CITY OF FRIDLEY, MINNESOTA SPECIAL REVENUE FUND - CABLE TV FUND COMPARATIVE BALANCE SHEET December 31, 2007 and 2006 Assets 20072006 Cash and investments$958,136$841,937 Accounts receivable51,00749,850 Total assets$1,009,143$891,787 Liabilities and Fund Balance Liabilities: Accounts payable$ - $14 Salaries payable1,5401,209 Total liabilities1,5401,223 Fund balance: Unreserved: Designated for special revenue programs1,007,603890,564 Total liabilities and fund balance$1,009,143$891,787 110024 111111000000222222 102 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, 2007 With comparative actual amounts for the year ended December 31, 2006 20072006 Budgeted AmountsActualActual OriginalFinalAmountsAmounts Revenues: Licenses - franchise fee$185,000$185,000$202,364$193,676 Charges for services735735700700 Investment income8,0008,00043,54635,297 Miscellaneous - - 1,5161,617 Total revenues193,735 193,735 248,126 231,290 Expenditures: Current: General government: Personal services129,917129,917122,581114,606 Supplies and other charges16,79916,7998,50611,262 Capital outlay35,00010,103 - 166,474 Total expenditures181,716 156,819 131,087 292,342 Net change in fund balance$12,019$36,916117,039(61,052) Fund balance - January 1890,564951,616 Fund balance - December 31$1,007,603$890,564 110035 111111000000333333 103 Exhibit D-3 CITY OF FRIDLEY, MINNESOTA SPECIAL REVENUE FUND - SOLID WASTE ABATEMENT FUND COMPARATIVE BALANCE SHEET December 31, 2007 and 2006 Assets 20072006 Cash and investments$ - $22,667 Accounts receivable24,63124,191 Due from other governments37,84621,143 Total assets$62,477$68,001 Liabilities and Fund Balance Liabilities: Accounts payable$22,572$21,983 Salaries payable1,4891,144 Due to other governments272876 Due to other funds41,900 - Total liabilities66,23324,003 Fund balance: Unreserved: Undesignated(3,756)43,998 Total liabilities and fund balance$62,477$68,001 111110000044444 104 Exhibit D-4 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, 2007 With comparative actual amounts for the year ended December 31, 2006 20072006 Budgeted AmountsActualActual OriginalFinalAmountsAmounts Revenues: Intergovernmental revenue: State$62,000$62,000$48,950$56,725 Charges for services244,742244,742247,347239,344 Miscellaneous100,000125,942131,474136,683 Total revenues406,742 432,684 427,771 432,752 Expenditures: Current: General government: Personal services61,44663,00763,00557,514 Supplies and other charges388,140412,521412,520391,009 Total expenditures449,586 475,528 475,525 448,523 Excess (deficiency) of revenues over (under) expneditures(42,844)(42,844)(47,754)(15,771) Other financing sources: Transfers in - - - 100,000 Net change in fund balance($42,844)($42,844)(47,754)84,229 Fund balance (deficit) - January 143,998(40,231) Fund balance (deficit) - December 31($3,756)$43,998 111110000055555 105 Exhibit D-5 CITY OF FRIDLEY, MINNESOTA SPECIAL REVENUE FUND - HRA REIMBURSEMENT FUND COMPARATIVE BALANCE SHEET December 31, 2007 and 2006 Assets 20072006 Due from component unit$8,941$13,606 Total assets$8,941$13,606 Liabilities and Fund Balance Liabilities: Accounts payable$ - $14 Due to other funds8,94113,592 Total liabilities8,94113,606 Fund balance - - Total liabilities and fund balance$8,941$13,606 111110000066666 106 Exhibit D-6 CITY OF FRIDLEY, MINNESOTA SPECIAL REVENUE FUND - HRA REIMBURSEMENT FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL For The Year Ended December 31, 2007 With comparative actual amounts for the year ended December 31, 2006 20072006 Budgeted AmountsActualActual OriginalFinalAmountsAmounts Revenues: Intergovernmental revenue: Housing and Redevelopment Authority$ - $20,341$20,342$28,886 Expenditures: Current: General government: Supplies and other charges - 20,34120,34228,886 Net change in fund balance$0$000 Fund balance - January 1 - - Fund balance - December 31$0$0 110079 111111000000777777 107 Exhibit D-7 CITY OF FRIDLEY, MINNESOTA SPECIAL REVENUE FUND - DRUG AND GAMBLING FORFEITURE FUND COMPARATIVE BALANCE SHEET December 31, 2007 and 2006 Assets 20072006 Cash and investments$33,817$33,166 Due from other governments - 900 Total assets$33,817$34,066 Liabilities and Fund Balance Liabilities: Accounts payable$ - $1,584 Due to other governments - 102 Total liabilities01,686 Fund balance: Unreserved: Designated for special revenue programs33,81732,380 Total liabilities and fund balance$33,817$34,066 110180 111111000000888888 108 Exhibit D-8 CITY OF FRIDLEY, MINNESOTA SPECIAL REVENUE FUND - DRUG AND GAMBLING FORFEITURE FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL For The Year Ended December 31, 2007 With comparative actual amounts for the year ended December 31, 2006 20072006 Budgeted AmountsActualActual OriginalFinalAmountsAmounts Revenues: Fines and forfeits$ - $21,491$22,928$5,100 Miscellaneous - - - 4,961 Total revenues021,49122,92810,061 Expenditures: Current: Public safety Supplies and other charges - 21,49121,49125,202 Net change in fund balance$0$01,437(15,141) Fund balance - January 132,38047,521 Fund balance - December 31$33,817$32,380 111110000099999 109 Exhibit D-9 CITY OF FRIDLEY, MINNESOTA SPECIAL REVENUE FUND - F.C.C. DONATIONS FUND COMPARATIVE BALANCE SHEET December 31, 2007 and 2006 Assets 20072006 Cash and investments$83,581$86,313 Total assets$83,581$86,313 Liabilities and Fund Balance Liabilities$ - $ - Fund balance: Unreserved: Designated for special revenue programs83,58186,313 Total liabilities and fund balance$83,581$86,313 111102 111111111111000000 110 Exhibit D-10 CITY OF FRIDLEY, MINNESOTA SPECIAL REVENUE FUND - F.C.C. DONATIONS FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL For The Year Ended December 31, 2007 With comparative actual amounts for the year ended December 31, 2006 20072006 Budgeted AmountsActualActual OriginalFinalAmountsAmounts Revenues: Investment income$ - $6,843$4,111$3,789 Expenditures: Current: General government: Supplies and other charges - 6,8436,8434,415 Net change in fund balance$0$0(2,732)(626) Fund balance - January 186,31386,939 Fund balance - December 31$83,581$86,313 111113 111111111111111111 111 Exhibit D-11 CITY OF FRIDLEY, MINNESOTA SPECIAL REVENUE FUND - POLICE ACTIVITY FUND COMPARATIVE BALANCE SHEET December 31, 2007 and 2006 Assets 20072006 Cash and investments$20,726$203,131 Total assets$20,726$203,131 Liabilities and Fund Balance Liabilities$ - $ - Fund balance: Reserved for police activity20,726203,131 Total liabilities and fund balance$20,726$203,131 111124 111111111111222222 112 Exhibit D-12 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, 2007 With comparative actual amounts for the year ended December 31, 2006 20072006 Budgeted AmountsActualActual OriginalFinalAmountsAmounts Revenues: Investment income$5,955$5,955$7,595$24,086 Expenditures - - - - Excess (deficiency) of revenues over (under) expenditures5,9555,9557,59524,086 Other financing sources (uses): Transfers out: General Fund(190,000)(190,000)(190,000)(509,169) Net change in fund balance($184,045)($184,045)(182,405)(485,083) Fund balance - January 1203,131688,214 Fund balance - December 31$20,726$203,131 111111111133333 113 Exhibit D-13 CITY OF FRIDLEY, MINNESOTA SPECIAL REVENUE FUND - SPRINGBROOK NATURE CENTER FUND COMPARATIVE BALANCE SHEET December 31, 2007 and 2006 Assets 20072006 Cash and investments$74,950$58,037 Receivables: Accounts1,316500 Taxes9,0907,517 Total assets$85,356$66,054 Liabilities and Fund Balance Liabilities: Accounts payable$4,431$2,601 Salaries payable5,3154,204 Due to other governments37 Deferred Revenue7,7125,874 Total liabilities17,46112,686 Fund balance: Unreserved: Undesignated67,89553,368 Total liabilities and fund balance$85,356$66,054 111111111144444 114 Exhibit D-14 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, 2007 With comparative actual amounts for the year ended December 31, 2006 20072006 Budgeted AmountsActualActual OriginalFinalAmountsAmounts Revenues: Taxes$290,600$290,600$288,502$280,047 Charges for service75,00081,42185,36775,359 Investment income - - 779220 Miscellaneous - 2,1151,215501 Total revenues365,600374,136375,863356,127 Expenditures Current: Naturalist: Personal services282,312294,613294,613264,231 Supplies and other charges70,48966,72466,72373,130 Total expenditures352,801 361,337 361,336 337,361 Excess of revenues over expenditures12,79912,79914,52718,766 Other financing sources (uses): Transfers out: General Fund - - - (18,548) Net change in fund balance$12,799$12,79914,527218 Fund balance - January 153,36853,150 Fund balance - December 31$67,895$53,368 111111111155555 115 Exhibit E-1 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, 2007 With comparative actual amounts for the year ended December 31, 2006 20072006 Budgeted AmountsActualActual OriginalFinalAmountsAmounts Revenues: Taxes$103,000$97,832$97,388$95,343 Special assessments - - - 220 Intergovernmental revenue: State425,000481,76870,526654,646 Investment income169,530169,530328,386303,239 Miscellaneous10,00010,00043,37817,000 Total revenues707,530 759,130 539,678 1,070,448 Expenditures: Current: General government: Supplies and other charges - 200,766200,765120,082 Debt service - - 41,635 - Capital outlay272,000192,13489,592645,788 Total expenditures272,000 392,900 331,992 765,870 Excess of revenues over expenditures435,530366,230207,686304,578 Other financing sources (uses): Bonds issued2,025,0002,025,0001,910,0002,443,438 Transfers out(2,590,000)(2,641,600)(2,482,916)(3,008,438) Total other financing sources (uses)(565,000)(616,600)(572,916)(565,000) Net change in fund balance($129,470)($250,370)(365,230)(260,422) Fund balance - January 15,470,4345,730,856 Fund balance - December 31$5,105,204$5,470,434 111111111166666 116 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. 111291 111111111111977777 117 Exhibit F-1 CITY OF FRIDLEY, MINNESOTA COMBINING STATEMENT OF NET ASSETS INTERNAL SERVICE FUNDS December 31, 2007 With comparative totals for December 31, 2006 EmployeeSelfInformation BenefitsInsuranceSystems Totals Assets:20072006 Current assets: Cash and investments$1,109,966$1,741,890$877,594$3,729,450$3,453,944 Due from component unit269 - - 269432 Total current assets1,110,2351,741,890877,5943,729,7193,454,376 Capital assets, at cost: Machinery and equipment - - 1,349,9691,349,9691,334,694 Less: accumulated depreciation - - (1,095,268)(1,095,268)(1,008,785) Net capital assets00254,701254,701325,909 Total assets1,110,2351,741,8901,132,2953,984,4203,780,285 Liabilities: Current liabilities: Accounts payable1855004,2524,93723,613 Payroll deductions payable87,956 - - 87,95680,878 Compensated absences payable - current portion728,858 - - 728,858663,146 Total current liabilities816,9995004,252821,751767,637 Noncurrent liabilities: Compensated absences payable115,138 - - 115,138141,815 Total liabilities932,1375004,252936,889909,452 Net assets: Invested in capital assets - - 254,701254,701325,909 Unrestricted178,0981,741,390873,3422,792,8302,544,924 Total net assets$178,098$1,741,390$1,128,043$3,047,531$2,870,833 118 Exhibit F-2 CITY OF FRIDLEY, MINNESOTA COMBINING STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET ASSETS INTERNAL SERVICE FUNDS For The Year Ended December 31, 2007 With comparative totals for the year ended December 31, 2006 EmployeeSelfInformation BenefitsInsuranceSystems Totals 20072006 Operating revenues: Charges for services$67,237$ - $148,764$216,001$274,028 Operating expenses: Personal services71,197 - - 71,197113,039 Supplies and other charges1,54949,90412,27263,72578,190 Depreciation - - 148,319148,319179,009 Total operating expenses72,74649,904160,591283,241370,238 Operating income (loss)(5,509)(49,904)(11,827)(67,240)(96,210) Nonoperating revenues: Investment income48,86781,49839,967170,332146,064 Insurance reimbursement - 72,481 - 72,481 - Gain (loss) on disposal of capital assets - - 1,1251,125(6,697) Total nonoperating revenues48,867153,97941,092243,938139,367 Change in net assets43,358104,07529,265176,69843,157 Net assets - January 1134,7401,637,3151,098,7782,870,8332,827,676 Net assets - December 31$178,098$1,741,390$1,128,043$3,047,531$2,870,833 119 Exhibit F-3 CITY OF FRIDLEY, MINNESOTA COMBINING STATEMENT OF CASH FLOWS INTERNAL SERVICE FUNDS For The Year Ended December 31, 2007 With comparative totals for the year ended December 31, 2006 EmployeeSelfInformation BenefitsInsuranceSystems Totals 20072006 Cash flows from operating activities: Receipts from interfund services provided$67,400$ - $148,764$216,164$273,487 Payment to suppliers(1,580)(52,113)(28,708)(82,401)(113,197) Payment to employees(25,084) - - (25,084)(49,962) Net cash flows from operating activities40,736(52,113)120,056108,679110,328 Cash flows from capital and related financing activities: Acquisition of capital assets - - (77,111)(77,111)(83,227) Insurance reimbursement - 72,481 - 72,481 - Proceeds from sale of capital assets - - 1,1251,125(6,697) Net cash flows from capital and and related financing activities 072,481(75,986)(3,505)(89,924) Cash flows from investing activities: Investment income48,86781,49839,967170,332146,064 Net increase in cash and cash equivalents89,603101,86684,037275,506166,468 Cash and cash equivalents - January 11,020,3631,640,024793,5573,453,9443,287,476 Cash and cash equivalents - December 31$1,109,966 $1,741,890 $877,594 $3,729,450 $3,453,944 Reconciliation of operating income (loss) to net cash provided (used) by operating activities: Operating income (loss) ($5,509)($49,904)($11,827)($67,240)($96,210) Adjustments to reconcile operating income (loss) to net cash flows from operating activities: Depreciation - - 148,319148,319179,009 Changes in assets and liabilities: Decrease (increase) in receivables163 - - 163(325) Increase (decrease) in payables46,082(2,209)(16,436)27,43727,854 Total adjustments46,245 (2,209)131,883 175,919 206,538 Net cash provided by operating activities$40,736($52,113)$120,056$108,679$110,328 120 Exhibit F-4 CITY OF FRIDLEY, MINNESOTA INTERNAL SERVICE FUND - EMPLOYEE BENEFITS FUND COMPARATIVE STATEMENT OF NET ASSETS December 31, 2007 and 2006 20072006 Assets: Current assets: Cash and investments$1,109,966$1,020,363 Due from component unit269432 Total current assets1,110,2351,020,795 Liabilities: Current liabilities: Payroll deductions payable87,95680,878 Accounts payable185216 Compensated absences payable - current portion728,858663,146 Total current liabilities816,999744,240 Noncurrent liabilities: Compensated absences payable 115,138141,815 Total liabilities932,137886,055 Net assets: Unrestricted178,098134,740 Total net assets$178,098$134,740 111112222211111 121 Exhibit F-5 CITY OF FRIDLEY, MINNESOTA INTERNAL SERVICE FUND - EMPLOYEE BENEFITS FUND COMPARATIVE STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET ASSETS For The Year Ended December 31, 2007 With comparative amounts for the year ended December 31, 2006 20072006 Operating revenues$67,237$109,106 Operating expenses: Personal services71,197113,039 Supplies and other charges1,5491,552 Total operating expenses72,746114,591 Operating income (loss)(5,509)(5,485) Nonoperating revenues: Investment income48,86740,951 Change in net assets43,35835,466 Net assets - January 1134,74099,274 Net assets - December 31$178,098$134,740 111112222222222 122 Exhibit F-6 CITY OF FRIDLEY, MINNESOTA INTERNAL SERVICE FUND - EMPLOYEE BENEFITS FUND COMPARATIVE STATEMENT OF CASH FLOWS For The Year Ended December 31, 2007 With comparative amounts for the year ended December 31, 2006 20072006 Cash flows from operating activities: Receipts from interfund services provided$67,400$5,896 Payment to suppliers(1,580)(1,336) Payment to employees(25,084)52,707 Net cash flows from operating activities40,73657,267 Cash flows from investing activities: Investment income48,86740,951 Net increase in cash and cash equivalents89,60398,218 Cash and cash equivalents - January 11,020,363922,145 Cash and cash equivalents - December 31$1,109,966 $1,020,363 Reconciliation of operating income (loss) to net cash provided (used) by operating activities: Operating income (loss) ($5,509)($5,485) Adjustments to reconcile operating income (loss) to net cash flows from operating activities: Changes in assets and liabilities: (Increase) decrease in receivables163(325) Increase (decrease) in payables46,08263,077 Total adjustments46,245 62,752 Net cash provided (used) by operating activities$40,736$57,267 111112222233333 123 Exhibit F-7 CITY OF FRIDLEY, MINNESOTA INTERNAL SERVICE FUND - SELF INSURANCE FUND COMPARATIVE STATEMENT OF NET ASSETS December 31, 2007 With comparative amounts for December 31, 2006 20072006 Assets: Current assets: Cash and investments$1,741,890$1,640,024 Liabilities: Current liabilities: Accounts payable5002,709 Net assets: Unrestricted1,741,3901,637,315 Total net assets$1,741,390$1,637,315 111112222244444 124 Exhibit F-8 CITY OF FRIDLEY, MINNESOTA INTERNAL SERVICE FUND - SELF INSURANCE FUND COMPARATIVE STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET ASSETS For The Year Ended December 31, 2007 With comparative amounts for the year ended December 31, 2006 20072006 Operating revenues$ - $ - Operating expenses: Supplies and other charges49,90446,883 Operating income (loss)(49,904)(46,883) Nonoperating revenues: Investment income81,49873,196 Insurance reimbursement72,481 - Total nonoperating revenues153,97973,196 Change in net assets104,07526,313 Net assets - January 11,637,3151,611,002 Net assets - December 31$1,741,390$1,637,315 111112222255555 125 Exhibit F-9 CITY OF FRIDLEY, MINNESOTA INTERNAL SERVICE FUND - SELF INSURANCE FUND COMPARATIVE STATEMENT OF CASH FLOWS For The Year Ended December 31, 2007 With comparative amounts for the year ended December 31, 2006 20072006 Cash flows from operating activities: Payment to suppliers($52,113)($99,171) Cash flows from capital and related financing activities: Insurance reimbursement72,481 - Cash flows from investing activities: Investment income81,49873,196 Net increase (decrease) in cash and cash equivalents101,866(25,975) Cash and cash equivalents - January 11,640,0241,665,999 Cash and cash equivalents - December 31$1,741,890 $1,640,024 Reconciliation of operating income (loss) to net cash provided (used) by operating activities: Operating income (loss) ($49,904)($46,883) Adjustments to reconcile operating income (loss) to net cash flows from operating activities: Changes in assets and liabilities: Increase (decrease) in payables(2,209)(52,288) Total adjustments(2,209)(52,288) Net cash provided (used) by operating activities($52,113)($99,171) 111112222266666 126 Exhibit F-10 CITY OF FRIDLEY, MINNESOTA INTERNAL SERVICE FUND - INFORMATION SYSTEMS FUND COMPARATIVE STATEMENT OF NET ASSETS December 31, 2007 With comparative amounts for December 31, 2006 20072006 Assets: Current assets: Cash and investments$877,594$793,557 Capital assets, at cost: Property and equipment1,349,9691,334,694 Less: accumulated depreciation(1,095,268)(1,008,785) Net capital assets254,701325,909 Total assets1,132,2951,119,466 Liabilities: Current liabilities: Accounts payable4,25220,688 Net assets: Invested in capital assets, net of related debt254,701325,909 Unrestricted873,342772,869 Total net assets$1,128,043$1,098,778 111112222277777 127 Exhibit F-11 CITY OF FRIDLEY, MINNESOTA INTERNAL SERVICE FUND - INFORMATION SYSTEMS FUND COMPARATIVE STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET ASSETS For The Year Ended December 31, 2007 With comparative amounts for the year ended December 31, 2006 20072006 Operating revenues: Charges for services$148,764$164,922 Operating expenses: Supplies and other charges12,27229,755 Depreciation148,319179,009 Total operating expenses160,591208,764 Operating income (loss)(11,827)(43,842) Nonoperating revenues: Investment income39,96731,917 Gain (loss) on disposal of fixed assets1,125(6,697) Total nonoperating revenues41,09225,220 Change in net assets29,265(18,622) Net assets - January 11,098,7781,117,400 Net assets - December 31$1,128,043$1,098,778 111112222288888 128 Exhibit F-12 CITY OF FRIDLEY, MINNESOTA INTERNAL SERVICE FUND - INFORMATION SYSTEMS FUND COMPARATIVE STATEMENT OF CASH FLOWS For The Year Ended December 31, 2007 With comparative amounts for the year ended December 31, 2006 20072006 Cash flows from operating activities: Receipts from interfund services provided$148,764$164,922 Payment to suppliers(28,708)(12,690) Net cash flows from operating activities120,056152,232 Cash flows from capital and related financing activities: Acquisition of capital assets(77,111)(83,227) Proceeds from sale of capital assets1,125(6,697) Net cash flows from capital and related financing activities(75,986)(89,924) Cash flows from investing activities: Investment income39,96731,917 Net increase in cash and cash equivalents84,03794,225 Cash and cash equivalents - January 1793,557699,332 Cash and cash equivalents - December 31$877,594 $793,557 Reconciliation of operating income (loss) to net cash provided (used) by operating activities: Operating income (loss) ($11,827)($43,842) Adjustments to reconcile operating income (loss) to net cash flows from operating activities: Depreciation148,319179,009 Changes in assets and liabilities: Increase (decrease) in payables(16,436)17,065 Total adjustments131,883 196,074 Net cash provided by operating activities$120,056$152,232 112299 129 CITY OF FRIDLEY 113324 111111333333200000 130 HOUSING AND REDEVELOPMENT AUTHORITY COMPONENT UNIT 113335 111111333333311111 131 CITY OF FRIDLEY, MINNESOTA BALANCE SHEET - GOVERNMENTAL FUNDS HOUSING AND REDEVELOPMENT AUTHORITY December 31, 2007 With comparative totals for December 31, 2006 North Area / General FundHousing LoanUniv. Ind. Park Assets Cash and investments$4,647,634$3,307,172$2,162,033 Receivables: Accounts33,474 - - Interest5,822 - - Taxes: Unremitted2,018 - 14,074 Delinquent8,466 - 118,448 Mortgage: Deferred - 1,072,14443,255 Allowance for uncollectible accounts - (44,900) - Prepaid Expenses - 5,499 - Due from other funds3,313,825 - - Due from primary government18,480 - - Land held for resale1,953,406 - 192,000 Total assets$9,983,125$4,339,915$2,529,810 Liabilities and Fund Balance Liabilities: Accounts payable$19,266$ - $26,286 Due to primary government54,418 - - Due to other funds - - - Deferred revenue1,961,872 - 310,448 Loan payable to primary government - 348,441 - Total liabilities2,035,556348,441336,734 Fund balance: Reserved for debt service3,000,000 - - Reserved for mortgage receivable - 1,072,14443,255 Unreserved, undesignated4,947,5692,919,3302,149,821 Total fund balance7,947,5693,991,4742,193,076 Total liabilities and fund balance$9,983,125$4,339,915$2,529,810 111133332222 132 Exhibit G-1 Other Governmental Lake PointeGateway EastGateway WestFunds Totals Governmental Funds 20072006 $338,508$28,029$2,913$5,854,457$16,340,746$17,073,927 - - - - 33,47436,495 - - - - 5,8225,737 615 - - 2,89319,6008,080 1,0831,445 - 30,976160,418138,803 - - - - 1,115,3991,226,479 - - - - (44,900)(22,902) - - - - 5,499 - - - - - 3,313,8253,678,725 - - - - 18,480 - 50,000 - 233,332180,0002,608,7381,123,665 $390,206$29,474$236,245$6,068,326$23,577,101$23,269,009 $301,300$ - $ - $34,661$381,513$419,658 - - - - 54,418146,811 785,303894,6531,469,109164,7603,313,8253,678,725 51,0831,445233,332210,9762,769,1561,262,469 - - - - 348,441415,908 1,137,686896,0981,702,441410,3976,867,3535,923,571 - - - - 3,000,0003,000,000 - - - - 1,115,3991,226,479 (747,480)(866,624)(1,466,196)5,657,92912,594,34913,118,959 (747,480)(866,624)(1,466,196)5,657,92916,709,74817,345,438 $390,206$29,474$236,245$6,068,326$23,577,101$23,269,009 Fund balance reported above$16,709,748$17,345,438 Amounts reported for governmental activities in the statement of net assets are different because: Other long-term assets are not available to pay for current-period expenditures and, therefore, are deferred in the funds2,769,1561,262,469 Net assets of governmental activities$19,478,904$18,607,907 111133333333 133 CITY OF FRIDLEY, MINNESOTA STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES GOVERNMENTAL FUNDS HOUSING AND REDEVELOPMENT AUTHORITY For The Year Ended December 31, 2007 With comparative totals for the year ended December 31, 2006 North Area / General FundHousing LoanUniv. Ind. Park Revenues: Tax increment$ - $ - $1,194,630 Property taxes351,957 - - Investment income216,617142,09375,666 Intergovernmental revenue18,783 - - Mortgage interest earnings5,28946,419 - Rental9,600 - - Sale of real estate67,843 - - Miscellaneous - 14,976 - Receipt from primary government - - - Total revenues670,089203,4881,270,296 Expenditures: Personal services109,569 - - Supplies and other charges364,81555,1642,833 Capital outlay1,718,000 - - Developer assistance - - 42,241 Interest expense - 19,963 - Payment to primary government - - 1,238,325 Total expenditures2,192,38475,1271,283,399 Excess (deficiency) of revenues over expenditures(1,522,295)128,361(13,103) Fund balance - January 19,469,8643,863,1132,206,179 Fund balance - December 31$7,947,569$3,991,474$2,193,076 111133334444 134 Exhibit G-2 Other Governmental Lake PointeGateway EastGateway WestFunds Totals Governmental Funds 20072006 $678,496$39,161$ - $1,673,810$3,586,097$3,091,460 - - - - 351,957325,649 8,7481,734121214,742659,721691,707 - 4,876 - 34,70258,36162,089 - - - - 51,70850,628 - - - - 9,6009,600 - - 86,773 - 154,616327,093 - - - - 14,976101,189 - - 17,150 - 17,150124,236 687,24445,771104,0441,923,2544,904,1864,783,651 - - - - 109,56993,734 1,0261,27512,30650,813488,232403,760 - - - - 1,718,000656,950 610,646 - - 20,965673,8521,141,493 - - - - 19,96323,213 - - - 1,291,9352,530,2601,818,415 611,6721,27512,3061,363,7135,539,8764,137,565 75,57244,49691,738559,541(635,690)646,086 (823,052)(911,120)(1,557,934)5,098,38817,345,43816,699,352 ($747,480)($866,624)($1,466,196)$5,657,929$16,709,748$17,345,438 Amounts reported for governmental activities in the statement of activities (Exhibit A-2) are different because: Net changes in fund balances - total above($635,690)$646,086 Revenues in the statement of activities that do not provide current financial resources are not reported as revenues in the funds1,506,68769,991 Change in net assets of governmental activities (Exhibit A-2)$870,997$716,077 111133335555 135 CITY OF FRIDLEY, MINNESOTA SUBCOMBINING BALANCE SHEET NONMAJOR CAPITAL PROJECT FUNDS HOUSING AND REDEVELOPMENT AUTHORITY December 31, 2007 With comparative totals for December 31, 2006 Moore Lake University / Center CityAreaWinfieldOnanOsborne Assets Cash and investments$2,344,960$38,101$618,043$1,680,603$300,466 Receivables: Taxes: Unremitted - 2,476693124 Delinquent24,3216,57110 - - Land held for resale - 105,000 - - - Total assets$2,369,281$152,148$618,122$1,680,915$300,470 Liabilities and Fund Balance Liabilities: Accounts payable$24,245$ - $ - $ - $ - Due to primary government - - - - - Due to other funds - - - - - Deferred revenue24,321111,57110 - - Total liabilities48,566 111,571 10 0 0 Fund balance (deficit): Unreserved, undesignated2,320,71540,577618,1121,680,915300,470 Total fund balance (deficit)2,320,715 40,577 618,112 1,680,915 300,470 Total liabilities and fund balance$2,369,281$152,148$618,122$1,680,915$300,470 111133336666 136 Exhibit G-3 Housing McGlynnSatelliteBusiness57th Avenue Replacement Totals Nonmajor Capital BakeriesLane Apts.CenterRedevelopmentTIF #19#1 Project Funds 20072006 $200,343$400,741$ - $7,1646,942$257,094$5,854,457$5,227,069 - - - 8 - 242,8935,552 - 4925 - - - 30,97620,751 - - - - - 75,000180,000180,000 $200,343$400,790$25$7,172$6,942$332,118$6,068,326$5,433,372 $ - $ - $ - $10,416$ - $ - $34,661$9,023 - - - - - - - 450 - - - 124,76040,000 - 164,760124,760 - 4925 - - 75,000210,976200,751 0 49 25 135,176 40,000 75,000 410,397 334,984 200,343400,741 - (128,004)(33,058)257,1185,657,9295,098,388 200,343 400,741 0 (128,004)(33,058)257,118 5,657,929 5,098,388 $200,343$400,790$25$7,172$6,942$332,118$6,068,326$5,433,372 111133337777 137 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, 2007 With comparative totals for the year ended December 31, 2006 Moore Lake University / Center CityAreaWinfieldOnanOsborne Revenues: Tax increment$528,016$545,229$65,025$357,668$44,026 Investment income84,237(240)24,28561,83511,506 Intergovernmental revenue17,44910,442 - - - Other - - - - - Total revenues629,702555,43189,310419,50355,532 Expenditures: Supplies and other charges2,6942,3939831,1551,361 Developer assistance - - - - - Payment to primary government - 631,613 - - - Total expenditures2,694634,0069831,1551,361 Excess (deficiency) of revenues over (under) expenditures627,008(78,575)88,327418,34854,171 Fund balance (deficit) - January 11,693,707119,152529,7851,262,567246,299 Fund balance (deficit) - December 31$2,320,715$40,577$618,112$1,680,915$300,470 111133338888 138 Exhibit G-4 Housing McGlynnSatelliteBusiness57th Avenue Replacement Totals Nonmajor Capital BakeriesLane Apts.CenterRedevelopment#1 TIF #19Project Funds 20072006 $36,012$47,072$ - $23,295$ - $27,467$1,673,810$1,564,902 7,51715,495 - 6 - 10,101214,742209,520 - 4,324 - - - 2,48734,70237,085 - - - - - - - 83,204 43,52966,891023,301040,0551,923,2541,894,711 1,3521,2412,33799133,0583,24850,81316,877 - - - 20,965 - - 20,96526,063 - - 660,322 - - - 1,291,9351,399,419 1,3521,241662,65921,95633,0583,2481,363,7131,442,359 42,17765,650(662,659)1,345(33,058)36,807559,541452,352 158,166335,091662,659(129,349) - 220,3115,098,3884,646,036 $200,343$400,741$0($128,004)($33,058)$257,118$5,657,929$5,098,388 111133339999 139 CITY OF FRIDLEY 114424 111111444444200000 140 AGENCY FUNDS 114435 111111444444311111 141 Exhibit H-1 CITY OF FRIDLEY, MINNESOTA STATEMENT OF CHANGES IN ASSETS AND LIABILITIES AGENCY FUNDS For The Year Ended December 31, 2007 BalanceBalance January 1,December 31, 2007AdditionsDeletions2007 Six Cities Watershed Assets: Cash and investments$30,203$6,199$7,035$29,367 Receivables: Taxes: Unremitted35 - 134 Delinquent11944 - 163 Total assets$30,357$6,243$7,036$29,564 Liabilities: Due to other governments$30,357$6,243$7,036$29,564 Hotel/Motel Tax Assets: Cash and investments(179)$2,419$ - $2,240 Receivables: Accounts2,429 - 3312,098 Total assets$2,250$2,419$331$4,338 Liabilities: Due to other governments2,250$2,419$331$4,338 Totals Assets: Cash and investments$30,024$8,618$7,035$31,607 Receivables: Accounts2,429 - 3312,098 Taxes: Unremitted35 - 134 Delinquent11944 - 163 Total assets$32,607$8,662$7,367$33,902 Liabilities: Due to other governments$32,607$8,662$7,367$33,902 111111444444422222 142 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. ContentsPage Financial Trends145 These schedules contain trend information to help the reader understand how the city's financial performance and well-being have changed over time. Revenue Capacity150 These schedules contain information to help the reader assess the factors affecting the city's ability to generate its property tax. Debt Capacity156 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 Information162 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 Information164 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. 143 CITY OF FRIDLEY 114468 111111444444644444 144 Table 1 CITY OF FRIDLEY, MINNESOTA NET ASSETS BY COMPONENT Last Five Fiscal Years(1) (Accrual Basis of Accounting) 20032004200520062007 Governmental activities: Invested in capital assets, net of related debt$18,930,543$18,305,647$18,458,113$18,635,605$18,245,265 Restricted2,395,446 1,664,772 1,540,531 1,591,936 1,711,255 Unrestricted10,326,790 11,735,908 13,331,115 15,140,831 17,244,490 Total governmental activities net assets$31,652,779$31,706,327$33,329,759$35,368,372$37,201,010 Business-type activities: Invested in capital assets, net of related debt$17,003,867$14,528,247$16,454,772$17,354,621$16,951,085 Restricted - - - - - Unrestricted9,663,80711,814,6499,258,9847,955,4267,722,458 Total business-type activities net assets$26,667,674$26,342,896$25,713,756$25,310,047$24,673,543 Primary government: Invested in capital assets, net of related debt$35,934,410$32,833,894$34,912,885$35,990,226$35,196,350 Restricted2,395,446 1,664,772 1,540,531 1,591,936 1,711,255 Unrestricted19,990,597 23,550,557 22,590,099 23,096,257 24,966,948 Total primary government net assets$58,320,453$58,049,223$59,043,515$60,678,419$61,874,553 (1) The City implemented GASB Statement No. 34 for the fiscal year ended December 31, 2003. Therefore, information for years prior to 2003 is not available. 111114444455555 145 Table 2 Page 1 of 2 CITY OF FRIDLEY, MINNESOTA CHANGES IN NET ASSETS Last five fiscal years(1) (Accrual basis of accounting) 20032004200520062007 Expenses Governmental activities: General government$3,944,682$3,513,065$4,448,175$4,177,829$4,074,480 Public safety5,166,9755,468,0145,514,3306,023,3356,260,806 Public works3,749,4123,612,3184,105,8603,868,5174,208,765 Community development939,918602,335793,8361,118,661863,850 Recreation and naturalist1,105,240993,570767,5991,147,9661,312,502 Interest on long-term debt605,639544,478443,533397,036416,850 Total governmental activities expenses15,511,86614,733,78016,073,33316,733,34417,137,253 Business-type activities: Liquor5,010,6365,005,1984,919,4584,793,4194,920,511 Water2,030,6542,086,5132,070,0322,138,3712,279,034 Sanitary sewer3,419,1003,256,3713,570,1133,629,3613,798,053 Storm water359,189334,906320,596331,039381,944 Total business-type activities expenses10,819,57910,682,98810,880,19910,892,19011,379,542 Total primary government expenses$26,331,445$25,416,768$26,953,532$27,625,534$28,516,795 Program revenues Governmental activities: Charges for services: General government$1,301,146$1,032,130$1,263,265$1,443,361$1,468,699 Public safety542,725539,334569,993609,721709,209 Public works77,166286,165189,766197,96849,399 Community development411,300441,649599,870470,733656,674 Recreation and naturalist293,142369,736331,298346,382381,432 Operating grants and contributions1,481,7231,009,8611,121,7261,304,510930,593 Capital grants and contributions1,012,151882,2921,657,1061,919,108834,748 Total governmental activities program revenues5,119,3534,561,1675,733,0246,291,7835,030,754 Business-type activities: Charges for services: Liquor5,364,5885,376,4285,283,2295,136,0295,252,910 Water1,806,3581,763,6231,771,8461,929,5731,990,047 Sanitary sewer3,183,2603,248,9523,299,9573,345,0173,461,615 Storm water366,667381,360384,860391,032392,016 Operating grants and contributions37,976208600514 - Capital grants and contributions - - - - - Total business-type activities program revenues10,758,84910,770,57110,740,49210,802,16511,096,588 Total primary government program revenues$15,878,202$15,331,738$16,473,516$17,093,948$16,127,342 111114444466666 146 Table 2 Page 2 of 2 CITY OF FRIDLEY, MINNESOTA CHANGES IN NET ASSETS Last five fiscal years(1) (Accrual basis of accounting) 20032004200520062007 Net (expense) revenue: Governmental activities($10,392,513)($10,172,613)($10,340,309)($10,441,561)($12,106,499) Business-type activities(60,730)87,583(139,707)(90,025)(282,954) Total primary government net (expense) revenue(10,453,243)(10,085,030)(10,480,016)(10,531,586)(12,389,453) General revenues and other changes in net assets Governmental activities: General property taxes$5,273,363$5,816,656$7,428,226$8,253,653$8,986,924 Grants not restricted to programs3,751,5603,436,4733,365,7392,623,4073,152,421 Investment earnings423,215413,743511,464998,1541,111,116 Gain on sale of property10,4686804343,35759,438 Other - - - 1,60329,238 Transfers - - - 600,000600,000 Total governmental activities9,458,6069,667,55211,305,86312,480,17413,939,137 Business-type activities: Investment earnings118,029146,248168,445281,316245,172 Gain on Sale of Property6,530 - - 5,0001,278 Other6,502 - - - - Transfers - - - (600,000)(600,000) Total business-type activities131,061146,248168,445(313,684)(353,550) Total primary government$9,589,667$9,813,800$11,474,308$12,166,490$13,585,587 Change in net assets: Governmental activities($933,907)($505,061)$965,554$2,038,613$1,832,638 Business-type activities70,331233,83128,738(403,709)(636,504) Total primary government($863,576)($271,230)$994,292$1,634,904$1,196,134 (1) The City implemented GASB Statement No. 34 for the fiscal year ended December 31, 2003. Therefore, information for years prior to 2003 is not available. 111114444477777 147 Table 3 CITY OF FRIDLEY, MINNESOTA FUND BALANCES, GOVERNMENTAL FUNDS Last five fiscal years(1) (Modified accrual basis of accounting) 20032004200520062007 General Fund: Reserved$43,502$83,822$81,662$77,476$65,528 Unreserved: General fund4,338,4634,080,0124,020,2853,863,0235,206,778 Designated for employee benefits - - - - - Designated for contingencies - - - - - Undesignated - - - - - Total general fund$4,381,965$4,163,834$4,101,947$3,940,499$5,272,306 All other governmental funds: Reserved for: Long-term receivables$645,330$541,244$480,123$415,908$348,441 Public safety - 1,155,225688,214203,13120,726 Debt service609,992509,547389,197721,8661,214,519 Unreserved, reported in: Special revenue funds2,172,012541,7481,098,9951,106,6231,189,140 Capital projects funds6,490,4287,001,3906,881,5236,963,5245,223,563 Debt service5,508,8085,522,6475,976,8885,991,1026,201,350 Total all other governmental funds$15,426,570$15,271,801$15,514,940$15,402,154$14,197,739 (1) The City implemented GASB Statement No. 34 for the fiscal year ended December 31, 2003. Therefore, information for years prior to 2003 is not available. 111114444488888 148 Table 4 CITY OF FRIDLEY, MINNESOTA CHANGES IN FUND BALANCES, GOVERNMENTAL FUNDS (1) Last five fiscal years 20032004200520062007 Revenues: General property taxes$5,305,289$5,809,631$7,397,381$8,220,943$8,927,963 Special assessments470,648300,389550,909691,764635,817 Licenses and permits722,541785,582865,848876,9031,080,787 Intergovernmental4,075,0233,207,4822,767,7242,663,9091,872,643 Charges for services1,500,4291,533,2531,736,1811,855,1771,830,416 Fines and forfeits216,368176,878164,104261,535298,359 Earnings on investments330,133325,307411,333828,877920,850 Interest on loan32,05629,25326,30823,21319,962 Other2,023,5442,085,0692,625,8992,154,6562,288,309 Total revenues14,676,031 14,252,844 16,545,687 17,576,977 17,875,106 Expenditures: Current: General government3,569,9523,155,6174,244,4963,567,5033,893,952 Public safety4,925,5255,156,5295,204,5515,821,5235,999,557 Public works2,712,4212,608,3162,940,8692,944,9113,025,157 Community development934,151593,393671,1731,113,543861,872 Parks, recreation and naturalist1,068,875960,723737,0941,118,3921,194,290 Debt service: Principal1,180,0005,155,0006,095,0001,555,0001,825,000 Interest 627,899561,045422,366330,431359,010 Bond issuance costs2,20132,96835,99731,74242,986 Capital outlay1,705,270869,7703,112,7004,452,5003,114,203 Contingency - - 907 - Total expenditures16,726,294 19,093,361 23,465,153 20,935,545 20,316,027 Revenues over (under) expenditures(2,050,263) (4,840,517) (6,919,466) (3,358,568) (2,440,921) Other financing sources (uses): Refunding bond issues - 3,920,000 - - - Bonds issued - - 6,450,0002,505,0001,910,000 Premium/(discount) on bonds issue - (10,992)(7,160)(30,720) - Proceeds from sale of capital assets - - - 10,05458,313 Transfers in579,109558,609657,8784,966,400600,000 Transfers out - - - (4,366,400) - Total other financing sources (uses)579,109 4,467,617 7,100,718 3,084,334 2,568,313 Net change in fund balance($1,471,154)($372,900)$181,252($274,234)$127,392 Debt service as a percentage of noncapital expenditures0.0%0.0%0.0%0.0%0.0% Debt service as percentage of total expenditures 0.0%0.0%0.0%0.0%0.0% (1) The City implemented GASB Statement No. 34 for the fiscal year ended December 31, 2003. Therefore, information for years prior to 2003 is not available. 111114444499999 149 CITY OF FRIDLEY, MINNESOTA TAX CAPACITY VALUE AND ESTIMATED MARKET VALUE OF TAXABLE PROPERTY Last Ten Fiscal Years Commercial/ FiscalResidentialIndustrialPublicAll YearPropertyPropertyUtilityOther 1998 1999 Information Not Available 2000 2001 2002 2003 2004$11,163,343$12,740,016$44,539$3,388,828 200512,619,94812,517,53246,5633,762,125 200614,320,78613,166,65746,8613,833,436 200715,074,00814,500,00846,9534,236,896 Source: Continuing Disclosure Document 111115555500000 150 Table 5 Less: TotalFiscalAdjustedTotalEstimatedTax Capacity TaxDisparityTax CapacityDirect TaxMarketas a Percent CapacityContributionValueRateValueof EMV $26,292,507$4,685,134$21,607,37317.119$1,228,849,200121.68% 24,858,8014,337,63220,521,16918.3261,293,664,300121.14% 25,967,4244,312,75921,654,66517.0701,335,542,900119.92% 29,851,6804,769,07425,082,60616.3501,518,347,800119.01% 22,380,1593,223,21419,156,94529.9061,688,141,100116.83% 25,007,7893,579,12821,428,66128.6161,958,021,100116.70% 27,336,7264,292,06123,044,66530.2482,149,055,100118.62% 28,946,1684,624,09124,322,07733.5652,278,619,300119.01% 31,367,7404,115,59527,252,14531.9412,469,670,100115.10% 33,857,8654,587,79428,341,51431.3492,616,727,300119.46% 111115555511111 151 CITY OF FRIDLEY MINNESOTA DIRECT AND OVERLAPPING PROPERTY TAX CAPACITY RATES Last Ten Fiscal Years SchoolSchoolSchool FiscalDistrictDistrictDistrict YearCityNo. 11No. 13No. 14 199817.119%51.824%68.491%69.402% 199918.326%54.856%68.837%67.728% 200017.070%51.792%66.685%61.655% 200116.350%52.281%47.452%45.466% 200229.906%29.082%38.614%17.855% 200328.616%26.941%20.303%29.966% 200430.248%21.050%22.833%22.683% 200533.565%21.492%19.993%21.606% 200631.941%20.046%19.571%20.830% 200731.349%19.353%17.183%24.175% Source: Continuing Disclosure Document Notes: (1) 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. 111115555522222 152 Table 6 SchoolTotalSchoolSchoolSchoolSchool DistrictSpecialDistrictDistrictDistrictDistrict (1)(2, 4)(3)(3, 4)(1, 3) No. 16No. 11No. 13No. 14No. 16 CountyDistricts 58.662%30.618%6.603%107.400%124.314%125.225%114.679% 61.111%32.265%6.603%114.104%128.158%127.049%120.765% 51.440%30.861%8.224%108.610%123.385%118.575%108.621% 39.458%28.859%8.218%106.287%101.819%99.833%94.139% 25.985%37.976%7.528%105.313%115.198%94.439%102.639% 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% 111115555533333 153 Table 7 CITY OF FRIDLEY, MINNESOTA PRINCIPAL PROPERTY TAXPAYERS Current year and nine years ago 20071998 Percentage Percentage Taxableof Total CityTaxableof Total City CapacityCapacityCapacityCapacity TaxpayerValueRankValueValueRankValue Medtronic, Inc.$1,696,37815.01%$1,038,54623.95% Target Corporation704,762 2 2.08%1,287,786 1 4.90% Shamrock Investments585,950 3 1.73%436,706 3 1.66% Retail Trust IV (Wal-Mart/Sam's)352,806 4 1.04%396,260 5 1.51% Cummins Power (Onan)282,468 5 0.83% - 0 0.00% Northwest Racquet & Swim Club273,016 60.81%418,050 4 1.59% University Avenue Associates268,063 7 0.79%328,663 6 1.25% Maurice Fillister (Georgetown)266,750 8 0.79%79,214 8 0.30% Burlington Northern Railroad239,613 9 0.71%33,492 9 0.13% Riverpointe Apartments211,524 10 0.62%219,739 7 0.84% Total$4,881,33014.41%$4,238,45616.13% Total All Property$33,857,865$26,292,507 111111555555644444 154 Table 8 CITY OF FRIDLEY, MINNESOTA PROPERTY TAX LEVIES AND COLLECTIONS Last ten fiscal years Collected Within The FiscalTaxesCollections Fiscal Year of the LevyTotal Collections to Date YearLeviedin EndedFor ThePercentageSubsequentPercentage 31-DecFiscal YearAmountof LevyYearsAmountof Levy 1998$4,010,570$3,935,00498.12%$3,584$3,938,58898.21% 19994,034,9194,064,819100.74%36,1684,100,987101.64% 20004,035,671 3,928,752 97.35%44,5653,973,31798.45% 20014,205,000 4,147,788 98.64%8,6234,156,41198.84% 20025,613,1315,579,77799.41%40,3545,620,131100.12% 20035,825,8555,763,09798.92%40,7805,803,87799.62% 20046,483,7456,310,42997.33%39,2106,349,63997.93% 20058,067,9497,699,29095.43%27,8697,727,15995.78% 20068,757,1888,517,85597.27%132,0478,649,90298.77% 20079,200,4269,332,688(1)101.44%N/A9,464,735102.87% (1) Excess TIF collections included of $235,704 Source: City Finance Department. 111115555555555 155 CITY OF FRIDLEY, MINNESOTA RATIOS OF OUTSTANDING DEBT BY TYPE Last ten fiscal years Governmental ActivitiesPercentage of Estimated FiscalImprovementTax IncrementMarket Value YearBondsBondsTotalof Property 1998$1,290,000$13,760,000$15,050,0001.22% 19991,070,00013,685,00014,755,0001.14% 2000845,00013,610,00014,455,0001.08% 2001615,00012,735,00013,350,0000.88% 2002465,00011,735,00012,200,0000.72% 2003315,00010,705,00011,020,0000.56% 2004190,0009,595,0009,785,0000.46% 20051,805,0008,335,00010,140,0000.45% 20064,310,0006,780,00011,090,0000.45% 20076,065,0005,110,00011,175,0000.43% 111111555555866666 156 Table 9 Business Type Activities EstimatedTotal Market ValueSewer/WaterTotalPer PrimaryPer of PropertyPopulationBondsBusiness TypeCustomerGovernmentCapita 1,228,849,20028,335$5,625,000$5,625,000690$20,675,000531 1,293,664,30028,6235,325,0005,325,00065020,080,000515 1,335,542,90027,4493,880,0003,880,00047318,335,000527 1,518,347,80027,8543,530,0003,530,00042816,880,000479 1,688,141,10027,8773,170,0003,170,00038315,370,000438 1,958,021,10027,4602,800,0002,800,00033813,820,000401 2,149,055,10027,4805,405,0005,405,00065715,190,000356 2,278,619,30027,0883,815,0003,815,00045813,955,000374 2,469,670,10026,6793,420,0003,420,00041514,510,000416 2,616,727,30026,6033,015,0003,015,00036614,190,000420 111111555555977777 157 Table 10 CITY OF FRIDLEY, MINNESOTA DIRECT AND OVERLAPPING GOVERNMENTAL ACTIVITIES DEBT December 31, 2007 Estimated EstimatedShare of DebtPercentageOverlapping Governmental UnitOutstandingApplicable*Debt Debt repaid with property taxes: Independent School District No. 11$173,410,4851.60%$2,774,568 Independent School District No. 13$27,580,00031.46%8,676,668 Independent School District No. 1439,130,000 100.00%39,130,000 Independent School District No. 16106,205,000 36.80%39,083,440 Metro Council1,079,036,9111.19%12,840,539 Anoka County124,025,000 18.04%22,374,110 Vocational/Technical District No. 91611,030,000 2.21%243,763 Subtotal - overlapping debt125,123,088 City of Fridley - Direct debt14,190,000 14,190,000 $139,313,088 Total direct and overlapping debt 111555888 158 Table 11 CITY OF FRIDLEY, MINNESOTA LEGAL DEBT MARGIN INFORMATION Last ten fiscal years Market Value$2,616,727,300 Debt Limit 2% of Market Value$52,334,546 Amount of Debt Applicable to Debt Limit: Total Debt$14,190,000 Deductions: Tax Increment Redevelopment Bonds$6,065,000 Improvement Bonds5,110,000 Revenue Bonds3,015,00014,190,000 Total Amount of Debt Applicable to Debt Limit - Legal Debt Margin$52,334,546 Legal Debt Margin Calculation for the last 10 Fiscal Years Net DebtLegalAmount of Debt FiscalDebtApplicable toDebtApplicable to YearLimitLimitMarginDebt Limit 1998$25,870,264$ - $25,870,2640.00% 199925,486,970 - 25,486,9700.00% 200026,327,646 - 26,327,6460.00% 200129,985,162 - 29,985,1620.00% 200233,380,154 - 33,380,1540.00% 200338,755,912 - 38,755,9120.00% 200442,589,016 - 42,589,0160.00% 200545,168,942 - 45,168,9420.00% 200649,393,402 - 49,393,4020.00% 200752,334,546 - 52,334,5460.00% 111111655555199999 159 CITY OF FRIDLEY, MINNESOTA PLEDGED-REVENUE COVERAGE Last ten fiscal years Improvement BondsUtility Revenue Bonds SpecialUtility Less FiscalAssessmentServiceOperatingDebt Service YearCollectionsPrincipalInterestCoverageRevenuesExpenses 1998$528,185$220,000$74,5311.79$6,520,948$5,469,928 1999494,241 220,000 63,426 1.745,389,003 5,242,663 2000507,953 225,000 51,874 1.835,150,374 4,965,373 2001497,208230,00039,7701.844,994,6695,148,461 2002463,579150,00029,6082.585,016,2335,251,371 2003449,867150,00021,6082.625,330,6035,664,739 2004273,81390,00010,3582.735,371,6625,430,082 2005542,548190,0005,3402.785,435,3615,821,541 2006671,204 - 67,4669.955,648,7205,977,607 2007602,988155,000160,4231.915,832,9046,350,572 111111666666200000 160 Table 12 Utility Revenue BondsTax Increment Bonds Net Tax Debt ServiceDebt Service AvaliableIncrement RevenuePrincipalInterestCoverageCollectionsPrincipalInterestCoverage $1,051,020$260,000$275,4981.96$1,454,531$420,000$781,5731.21 146,340 300,000 281,975 0.252,818,753 535,000 687,163 2.31 185,001 1,445,000 197,277 0.112,819,343 75,000 701,189 3.63 (153,792)350,000175,115-0.293,145,594875,000697,7012.00 (235,138)360,000158,422-0.452,564,0401,000,000654,6641.55 (334,136)370,000141,002-0.653,624,9681,030,000606,2912.22 (58,420)390,000334,960-0.083,078,4265,065,000546,9100.55 (386,180)1,590,000139,200-0.223,224,2045,905,000417,0260.51 (328,887)395,000121,164-0.643,091,4601,555,000262,9651.70 (517,668)305,000108,351-1.253,586,0971,670,000199,4891.92 111111666666311111 161 Table 13 CITY OF FRIDLEY, MINNESOTA DEMOGRAPHIC AND ECONOMIC STATISTICS Last ten fiscal years Per TotalCapita FiscalUnemploymentPersonalPersonal YearPopulationRateIncomeIncome 199828,3352.1%$634,845,675$22,405 199928,6232.3%690,186,39924,113 200027,4492.8%696,024,29325,357 200127,8543.6%724,064,73025,995 200227,8774.4%789,588,14828,324 200327,4604.3%622,985,02022,687 200427,4805.0%691,644,12025,169 200527,0885.0%695,674,01625,682 200626,6794.6%703,978,77326,387 200726,6034.8%712,747,57626,792 Sources: Metropolitan Council (population), Continuing Disclosure Document (unemployment rate) 111116666622222 162 Table 14 CITY OF FRIDLEY, MINNESOTA PRINCIPAL EMPLOYERS Current year and nine years ago 20071998 Percentage Percentage of Total Cityof Total City EmployerEmployeesRankEmploymentEmployeesRankEmployment Medtronic, Inc.2,500110.58%4,000115.23% United Defense Systems1,80027.62%1,30034.95% 1,72737.31%1,36525.20% Cummins Power (Onan) Unity Medical Center1,40045.92%4409 1.68% Target60052.54%37610 1.43% Minco Products50062.12%6585 2.51% 35071.48%65082.48% Kurt Manufacturing Park Construction30081.27%0.00% Parsons Electric30091.27%4707 1.79% Wal-Mart262101.11%0.00% Burlington0.00%9004 3.43% 0.00%5026 1.91% McGlynn's Total5,43941.21%10,66140.60% Total City Employment23,63526,257 Source: Continuing Disclosure Documents, Minnesota Department of Employment and Economic Development and the Met Council. 111111666666533333 163 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/Program1998199920002001 General government: City Administration4443 Finance21212124 Human Resource2222 Community Development99910 Public safety: Police department49494950 Fire department7778 Public works: Administration5655 Engineering4444 Mechanic3233 Streets9999 Water6666 Sewer5556 Parks6666 Parks and recreation: Recreation and Naturalist8888 Total138138138144 Source: City Finance Department 111116666644444 164 Table 15 Full-Time Equivalent Employees as of December 31, 200220032004200520062007 443333 242423232322 222222 101088107 505046464744 898899 554442 332224 333333 999999 665555 555555 677777 8958118 143146130133140130 111116666655555 165 CITY OF FRIDLEY, MINNESOTA OPERATING INDICATORS BY FUNCTION/PROGRAM Last ten fiscal years Fiscal Year Function/Program199819992000 Police: Physical arrests1,7901,8501,329 Parking violationsN/AN/A1,344 Traffic violationsN/AN/A1,724 Fire: Emergency responses2,2862,2672,294 Fires occurred140121113 Inspections (Fire and Rental)N/AN/A323 Refuse collection: Recyclables collected (tons per day)6.896.906.89 Building inspection: Permits issued: Residential2,9771,632836 Commercial1119096 Total permit valuation$21,371,526$42,636,736$101,645,877 Other public works: Street resurfacing (miles)1.34.21.3 Water: Connections8,1588,1818,195 Storage capacity6,500,0006,500,0006,500,000 Average daily demand (gallons)550,000550,000550,000 Peak daily demand (gallons)900,000900,000900,000 Sewer: Connections8,1708,1908,190 Sources: Various City departments. No operating indicators were available for the Parks, recreation and naturalist function. 111116666666666 166 Table 16 Fiscal Year 2001200220032004200520062007 1,6451,4471,3339561,2051,5761,290 513635532644884572792 1,4352,2092,4292,1291,7894,4454,035 2,2932,5572,5492,4062,7192,5682,804 105144124137107127109 1,1451,4271,4251,6511,4671,0155,693 6.806.756.706.706.696.956.96 6677306426247507681,206 7052659986115366 $21,808,039$11,619,328$16,078,198$22,029,469$25,057,537$21,750,596$47,871,624 1.21.21.21.24.14.83.7 8,2098,2548,2798,2888,2328,2358,230 6,500,0006,500,0006,500,0006,500,0006,500,0006,500,0006,500,000 550,000550,000550,000646,000550,000550,000550,000 900,000900,000900,0001,319,0001,000,0001,090,0001,090,000 8,2198,2638,2888,2978,2508,2448,238 111116666677777 167 CITY OF FRIDLEY, MINNESOTA CAPITAL ASSET STATISTICS BY FUNCTION/PROGRAM Last ten fiscal years Fiscal Year Function/Program1998199920002001 Police: Stations1111 Squad cars11111111 Fire stations3333 Other public works: Streets (miles)126.1126.1127.2127.2 Highways (miles)10.810.810.810.8 Streetlights1,0421,0541,0541,054 Traffic signals35353535 Parks, recreation and naturalist: Acreage682682682682 Playgrounds29292929 Baseball/softball diamonds22222222 Soccer/football fields2222 Community centers1111 Water: Water mains (miles)112.8112.9112.9112.9 Fire hydrants1,0801,084998998 Storage capacity (gallons)3.5 million3.5 million3.5 million3.5 million Wastewater: Sanitary sewers (miles)103.0103.0103.0103.0 Storm sewers (miles)43.646.649.349.3 Sources: Various City departments. 168 Table 17 Fiscal Year 200220032004200520062007 111111 121212121212 333333 127.2127.2127.0127.0127.0127.0 10.810.810.811.011.011.0 1,0541,0541,0541,0551,0551,055 353535353535 682682682682682682 292929292929 222222222222 222222 111111 112.9112.9112.9112.9113.0113.0 9989989981,0121,0131,013 3.5 million3.5 million3.5 million3.5 million6.5 million6.5 million 103.0103.0103.0103.0103.0103.0 49.349.349.350.052.052.0 169 CITY OF FRIDLEY 117724 111111777777200000 170