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1994 CAFR yJ ' 1 � • CITY OF FRIDLEY, MINNESOTA Comprehensive Annual Financial Report December 31 , 1994 Prepared by: Department of Finance Richard D. Pribyl Finance Director Howard D. Koolick Assistant Finance Director • CITY OF FRIDLEY, MINNESOTA COMPREHENSIVE ANNUAL FINANCIAL REPORT YEAR.ENDED DECEMBER 31, 1994 TABLE OF CONTENTS EXHIBIT PAGE INTRODUCTORY SECTION List of Elected and Appointed Officials 1 Organizational Structure 2 City Manager's Letter of Transmittal 3 Chief Executive Officer's Letter of Transmittal 5 Certificate of Achievement for Excellence in Financial Reporting 15 FINANCIAL SECTION Auditors' Opinion 17 General Purpose Financial Statements Combined Financial Statements - Overview Combined Balance Sheet - All Fund Types and Account Groups A-1 20 Combined Statement of Revenues, Expenditures and Changes in Fund Balances - All Governmental Fund Types and Expendable Trust Funds A-2 24 Combined Statement of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual - General, Special Revenue and Budgeted Capital Project Fund Types A-3 26 Combined Statement of Revenues, Expenses and Changes in Retained Earnings - All Proprietary Fund Types A-4 29 Combined Statement of Cash Flows All Proprietary Fund Types A-5 30 Notes to Financial Statements 32 Financial Statements of Individual Funds: General Fund: Comparative Balance Sheet B-1 65 Statement of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual B-2 66 -' Schedule of Revenues and Other Financing Sources - Budget and Actual B-3 67 CITY OF FRIDLEY, MINNESOTA COMPREHENSIVE ANNUAL FINANCIAL REPORT YEAR ENDED DECEMBER 31, 1994 TABLE OF CONTENTS (CONTINUED) EXHIBIT PAGE FINANCIAL SECTION (CONTINUED) General Fund: (continued) Schedule of Expenditures and Other Financing Uses - Budget and Actual B-4 69 Special Revenue Funds: — Combining Balance Sheet C-1 76 — Combining Statement of Revenues, Expenditures and Changes in Fund Balances C-2 78 Cable TV Fund: — Comparative Balance Sheet C-3 80 — Statement of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual C-4 81 Grant Management Fund: -" Comparative Balance Sheet C-5 82 Statement of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual C-6 83 — Solid Waste Abatement Fund: Comparative Balance Sheet C-7 84 Statement of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual C-8 85 HRA Reimbursement Fund: Comparative Balance Sheet C-9 86 Statement of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual C-10 87 Drug and Gambling Forfeiture Fund: Comparative Balance Sheet C-11 88 Statement of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual C-12 89 CITY OF FRIDLEY, MINNESOTA COMPREHENSIVE ANNUAL FINANCIAL REPORT YEAR ENDED DECEMBER 31, 1994 TABLE OF CONTENTS (CONTINUED) EXHIBIT PAGE — FINANCIAL SECTION (CONTINUED) HRA Special Revenue Fund: Comparative Balance Sheet C-13 90 Statement of Revenue, Expenses, Expenditures and Changes in Fund Balances C-14 91 Housing Revitalization Special Revenue Fund: Balance Sheet C-15 92 Combining Statement C-16 93 Debt Service Funds: Combining Balance Sheet D-1 95 Combining Statement of Revenues, Expenditures and Changes in Fund Balance D-2 96 Capital Projects Funds: Combining Balance Sheet E-1 98 Combining Statement of Revenues, Expenditures and Changes in Fund Balances E-2 100 Capital Improvements Fund: Comparative Balance Sheet E-3 104 _. Statement of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual E-4 105 Enterprise Funds: Combining Balance Sheet F-1 107 Combining Statement of Revenues, Expenses and Changes in Retained Earnings F-2 108 Combining Statement of Cash Flows F-3 109 Liquor Fund: Comparative Balance Sheet F-4 110 Comparative Statement of Revenues, Expenses and — Changes in Retained Earnings F-5 111 CITY OF FRIDLEY, MINNESOTA COMPREHENSIVE ANNUAL FINANCIAL REPORT YEAR ENDED DECEMBER 31. 1994 TABLE OF CONTENTS (CONTINUED) EXHIBIT PAGE FINANCIAL SECTION (CONTINUED) — Liquor Fund: (continued) Comparative Statement of Cash Flows F-6 112 Public Utility Fund: Comparative Balance Sheet F-7 113 Comparative Statement of Revenues, Expenses and — Changes in Retained Earnings F-8 114 Comparative Statement of Cash Flows F-9 115 Internal Service Funds: Combining Balance Sheet G-1 117 — Combining Statement of Revenues, Expenses and Changes in Retained Earnings G-2 118 — Combining Statement of Cash Flows G-3 119 Employee Benefits Fund: Comparative Balance Sheet G-4 120 Comparative Statement of Revenues, Expenses and Changes in Retained Earnings G-5 121 Comparative Statement of Cash Flows G-6 122 Self Insurance Fund: — Comparative Balance Sheet G-7 123 Comparative Statement of Revenues, Expenses and Changes in Retained Earnings G-8 124 Comparative Statement of Cash Flows G-9 125 — Trust and Agency Funds: Combining Balance Sheet H-1 128 Industrial Development Revenue Bond Trust Fund: Comparative Statement of Revenues, Expenditures and Changes in Fund Balance H-2 129 CITY OF FRIDLEY, MINNESOTA _ COMPREHENSIVE ANNUAL FINANCIAL REPORT YEAR ENDED DECEMBER 31, 1994 TABLE OF CONTENTS (CONTINUED) EXHIBIT PAGE -. FINANCIAL SECTION (CONTINUED) All Agency Funds: Combining Statement of Changes in Assets and Liabilities H-3 130 General Fixed Assets: Comparative Schedule of General Fixed Assets I-1 133 Schedule of Changes in General Fixed Assets - By Function and Activity 1-2 134 Schedule of Changes in General Fixed Assets - By Function — and Activity 1-3 135 General Long-Term Debt: Comparative Schedule of General Long-Term Debt J-1 137 SUPPLEMENTAL INFORMATION Independent Auditor's Report on Compliance with Specific Requirements Applicable to Nonmajor Federal Financial Assistance Program Transactions 139 Independent Auditor's Report on the Internal Control Structure in Accordance with Government Auditing Standards 141 Independent Auditor's Report on Internal Control Structure Used in Administering Federal Financial Assistance Programs 145 Independent Auditor's Report on Compliance with General Requirements Applicable to Federal Financial Assistance -. Programs 149 Independent Auditor's Report on Supplementary Information - Schedule of Federal Financial Assistance 151 Compliance Report Based on an Audit of General Purpose Financial Statements Performed in Accordance with Government Auditing Standards 153 Schedule of Federal Financial Assistance K-1 155 Schedule of Assessed Valuation and Long Term Debt for the Tax Increment Financing District K-2 156 -' Schedule of Sources and Uses of Public Funds for the Tax Increment Financing District K-3 157 CITY OF FRIDLEY, MINNESOTA COMPREHENSIVE ANNUAL FINANCIAL REPORT YEAR ENDED DECEMBER 31, 1994 TABLE OF CONTENTS (CONTINUED) TABLE PAGE STATISTICAL SECTION — General Governmental Expenditures by Function - Last Ten Fiscal Years 1 159 General Revenues by Source - Last Ten Fiscal Years 2 160 Certified Property Tax Levies and Collections — - Last Ten Fiscal Years 3 161 Estimated Market Value and Taxable Value of All Taxable Property - — Last Ten Fiscal Years 4 162 Significant Minnesota Tax Policies 164 Property Tax Rates and Calculated Tax Levies - All Overlapping Governments - Last Ten Fiscal Years 5 166 Special Assessment Levies and Collections - Last Ten Fiscal Years 6 168 History of Certified Tax Levies and Tax Rates - Last Ten Fiscal Years 7 170 — Ratio of Net General Bonded Debt to Taxable Value and Net Bonded Debt Per Capita - Last Ten Fiscal Years 8 172 — Computation of Legal Debt Margin 9 174 Computation of Direct and Overlapping Bonded Debt and Comparative Debt Ratios 10 176 Ratio of Annual Debt Service Expenditures for General Bonded Debt -' to Total General Government Expenditures - Last Ten Fiscal Years 11 177 Revenue Bond Coverage - Last Ten Fiscal Years 12 178 — Demographic Statistics - Last Ten Fiscal Years 13 179 Construction, Bank Deposits and Property Value - Last Ten Fiscal Years 14 180 Principal Taxpayers 15 181 — Insurance Coverage 182 Miscellaneous Statistical Information 183 — General Information 186 INTRODUCTORY SECTION 4 a CITY OF FRIDLEY, MINNESOTA ELECTED AND APPOINTED OFFICIALS DECEMBER 31, 1993 ELECTED OFFICIALS Term of Office Expires December Mayor William J. Nee 1996 Councilmember At Large Nancy J. Jorgenson 1996 Councilmember, Ward I Steven E. Billings 1994 Councilmember,Ward II Dennis L Schneider 1994 Councilmember,Ward III Ann R. Bolkcom 1994 Note: Councilmember Bolkcom was elected on January 11, 1994 to represent Ward III for the remaining portion of Edward J. Fitzpatrick's term. APPOINTED OFFICIALS City Manager - William W. Burns City Attorney - Virgil C. Herrick Prosecuting Attorney - Carl J. Newquist Treasurer - Richard D. Pribyl City Clerk - William A. Champa Department Heads: Director of Finance - Richard D. Pribyl Director of Public Safety and Civil Defense Director - David H. Sallman Fire Chief - Charles J. McKusick Director of Public Works - John G. Flora Director of Recreation and Natural Resource - Jack G. Kirk Director of Community Development - Barbara J. Dacy 1 CITY ADMINISTRATIVE ORGANIZATIONAL STRUCTURE 1994 Total Authorized Positions(140) CITY MANAGER(6) City Manager Asst to City Manager Personnel Technician Public Information Specialist Secretary to the City Manager Personnel Secretary FINANCE(24) POLICE(48) FIRE(7) PUBLIC WORKS(37) RECREATION&NATURALIST(9) COMMUNITY DEVELOPMENT(9) Finance Director-Treasurer Public Safety Director- Fire Chief Director of Public Works Director of Recreation&Nat Director of Community Develop Secretary Emergency Management Director Dep Fire Chief Oper Analyst Sr Citizen Program Coordinator Secretary Staff Accountant Secretary (4)Firefighter Secretary Secretary Accountant Dep Pub Safety Dir Secretary BUILDING INSPECTION(3) Lieutenant ENGINEERING(4) NATURALIST(4) Chief Bldg Official ACCOUNTING(7) (4)Sergeant Asst Public Works Dir Nat Res Coordinator Secretary Asst Finance Director (3)Corporal Engineering Tech (2)Interpretive Specialist Accounting Specialist (28)Patrol Officer Engineering Alde-Admin Receptionist/Clerk Typist PLANNING(5) Utility Billing Cik Pub Sfty Projects Coor Engineering Tech/inspector Planning Coordinator General Accountant (2)Crime Prey Spec RECREATION(2) Code Enf Officer-Plan Asst Acctg-Data Proc Clk Office Supervisor PW MAINTENANCE(32) Program Supervisor (2)Planning Assistant Acctg-Data Proc Cik (2)Senior Office Aset Superintendant Program Specialist (1)Secretary Acctg-Data Proc Cik (4)Office Asst Secretary Outreach Worker Street Foreman ASSESSING(3) (3)PSW-D Assessor (3)Mechanic,Level B Appraiser PSW-C PSW-B Assmt Cik/Appraiser Asst (3)PSW-A Water Foreman MIS(2) (3)PSW-D MIS Technician PSW-A MIS Specialist Sewer Foreman (3)PSW-D CITY CLERK-RECORDS(3) PSW-A City Clerk Park Foreman Receptionist-LW Clerk (4)PSW-D Records Retention Spec PSW-B LIQUOR(S) Liquor Operations Manager (2)Liquor Store Manager (2)LC)Store Clerk City Organization For Service 1995 CITIZENS OF FRIDLEY CITY COUNCIL PLANNING COMMISSION OTHER COMMISSIONS • Appeals Commission • Police Commission • Recreation Commission • Cable Television Commission • Environmental & Energy Commission • Charter Commission* • Human Resources Commission Independent Commission - Only Funding Provided by City CITY ADMINISTRATION & GENERAL MANAGEMENT CITY MANAGER • Community Development • Recreation & Naturalist • Public Safety 1 • Public Works _ • Finance • Fire CITY OF FRIDLEY FRIDLEY MUNICIPAL CENTER •6431 UNIVERSITY AVE. N.E. FRIDLEY, MN 55432 •(612)571-3450• FAX (612)571-1287 June 20, 1995 The Honorable Mayor and Members of the City Council —• City of Fridley Council Members: In accordance with the Charter, we hereby transmit the Comprehensive Annual Financial Report of the City of Fridley for the year ending December 31, 1994. The Report includes an excellent and comprehensive letter from Richard D. Pribyl, Director of Finance and Howard D. Koolick, Assistant Finance Director, which provides a brief description of some of the activities in which the City is currently involved. Also highlighted in the letter are some of the more important financial management practices employed by the City's administrative staff. I would like to express my appreciation and commendation to them and the Finance Division staff for the manner in which the accounts are kept and the Report presented. I would also like to express appreciation for the commendable administrative financial management of the several departments and divisions by the respective department and division heads as revealed by this Report. Very truly yours, William W. Burns City Manager 3 CITYOF FRIDLEY FRIDLEY MUNICIPAL CENTER • 6431 UNIVERSITY AVE. N.E. FRIDLEY, MN 55432 • (612)571-3450• FAX (612)571-1287 June 20, 1995 _ Mr. William W. Burns, City Manager Mayor William J. Nee and Council Members Fridley, Minnesota 55432 Dear Mr. Burns, Mayor Nee and Council Members: The Comprehensive Annual Financial Report of the City of Fridley, Minnesota, for the fiscal year ending December 31, 1994, is submitted herewith: The organization, form, and contents of this report were prepared in accordance with the standards prescribed by the Government Finance Officers Association of the United States and Canada, the American Institute of Certified Public Accountants, the Governmental Accounting Standards Board, and the Minnesota State Auditor's Office. The Government Finance Officers Association awards Certificates of Achievement for Excellence in Financial Reporting to those governments whose annual financial ._ reports are judged to conform substantially with high standards of public financial reporting including generally accepted accounting principles promulgated by the Governmental Accounting Standards Board. The City of Fridley was awarded a Certificate of Achievement for Excellence in Financial Reporting for its annual financial report for the fiscal year 1993. It is our belief that the accompanying fiscal year 1994 financial report continues to meet program standards and it will be submitted to the Government Finance Officers Association for review. This report was prepared by the City's finance staff and consists of four sections: Section I is the introductory section and contains the table of contents, letter of transmittal, and ,._ other appropriate material. Section II is the financial section and contains the auditors' opinion, the combined financial statements, notes to the financial statements, combining statements, individual fund statements, and account group statements. Section Ill is the supplemental information section which includes information regarding federal programs and tax increment financing activity. Section IV is the statistical section which includes the previous year's financial and non-financial data. 5 CITY OF FRIDLEY, MINNESOTA Responsibility for both the accuracy of the presented data and the completeness and fairness of the presentation, including all disclosures, rests with the City. We believe the data as presented is accurate in all material aspects, that it is presented in a manner designed to fairly set forth the financial position and results of operations of the City as measured by the financial activity of its various funds, and that all disclosures necessary to enable the reader to gain the maximum understanding of the City's financial activity have been included. — The City's financial statements include all funds and account groups. Services provided by the City include police and fire protection; water and sanitary sewer utilities, the construction and maintenance of streets and infrastructure; recreational activities and cultural events. In addition to general government activities, the activities of the Fridley Housing and Redevelopment Authority (HRA) have been included since they serve the entire City and the City Council has the ability to control the actions of the HRA. However, the Fridley School Districts, the Fridley Police Relief Association and the Fridley — Volunteer Firefighters Relief Association have not met the established criteria for inclusion in the reporting entity, and accordingly are excluded from this report. GENERAL INFORMATION BACKGROUND AND LOCATION The City of Fridley is an older metropolitan community with an estimated 1994 population of 28,287. — The City is located just north of downtown Minneapolis and covers 11 square miles. The City was incorporated July 1, 1949 and is currently committed to redevelopment. With the help of the Housing and Redevelopment Authority, the City has been successful in attracting redevelopment projects. — LOCAL ECONOMY The Minneapolis-St. Paul area economy has continued to be relatively stable over the last several years. Unemployment for Anoka County has ranged around 4% for the last several years with very little change. Office and retail space continue to be readily available. The market values for these properties continue to decline slightly, although they appear to be recovering slowly. The Twin City area continues to receive a large influx of tourists to visit the Mall of America, the nation's largest mall which includes a seven acre indoor amusement park. While the hospitality industry adjacent to and near the Mall is benefitting, the City of Fridley, located 25 miles from the Mall, receives little or no benefit from the tourist traffic. —' Long term growth in Fridley's economy will result from new construction and redevelopment within the City's industrial and commercial areas. During 1994, the City welcomed a number of new businesses. — Murphy Warehouse,a storage and delivery warehouse, relocated to Fridley from the City of Minneapolis, opening a 266,000 square foot facility. Slumberland, a retail bed and furniture chain, opened a new store in the northern part of the City. Also, several smaller businesses relocated from other sites in — Fridley to larger buildings that were vacant. In addition to the new businesses, the City saw the opening of Norwood Square, a 50 unit specially designed low income senior citizen housing complex, in the fall of 1994. It is new development and — redevelopment such as these projects that will help Fridley grow. 6 CITY OF FRIDLEY, MINNESOTA GENERAL INFORMATION (CONTINUED) MAJOR INITIATIVES During 1994, the City Council continued to focus significant attention on the quality of the housing stock within the City. On July 11, the City Council adopted a rental housing ordinance which established an inspection process for all rental housing in the City. These inspections are designed to ensure that all rental housing meets minimum fire and safety standards. By the end of 1994,. 12.8% of the rental units had been inspected. The HRA and the City sponsor several housing programs that — include grants, loans and a first time homebuyer mortgages. During 1994, 35 homeownwers received over $1,141,000 of assistance. The HRA also acquired eight scattered sites that contained either abandoned or severly deteriorated housing. The houses were removed and the properties that can accomodate new housing were sold to a developer in early 1995. The developer will be building new single family homes on these sites. _ During the year, the City of Fridley directed a number of construction projects including the repair and replacement of the Locke Park Filters, storm water construction around Highland Lake and 52nd Avenue, repalcement of the Locke Lake Dam, improvements to Stinson Bouleveard, and the annual overlay and reconstruction of various City streets. The sealcoating program resumed in 1994 with a test of a new process in addition to the standard sealcoat method. Internally, an information systems committee was formed to review our use of computers, provide — recomendations on equipment acquisition and develop a five year computer plan. Several new postions were created during 1994 allowing the City to hire a number of new employees. Three new police officers were hired in order to meet the increasing demand for police services. The second liquor store manager was hired in early 1994, completing the reorganization of the management of the City liquor operation. Finally, a planning coordinator was hired to provide additional support for the increasing planning requests. We were also honored to receive the Distinguished Budget Presentation Award for our 1993 Budget. This represented the fifth consecutive year in which the City has received this award. PLANS FOR THE FUTURE The future of the City of Fridley, like all units of government, is filled with change and restructuring. The federal deficit and shortfalls in state revenue have and will continue to have a trickle down effect to lower levels. Cities are faced with the problems of financing their own traditional levels of service while simultaneously coping with cuts in intergovernmental revenues and the implementation of both federal and state mandates. The City applauds the efforts of the Minnesota State Legislature in their attempt to curtail unfunded state mandates. The City will continue to investigate new funding and cost sharing alternatives as well as reviewing our operations in order to decrease the reliance on intergovernmental reveunues. As a result of reviewing our operations, several new computer systems are projected for installation in 1995. The fixed asset and special assessment modules of the HTE Inc. computer software is scheduled for installation during 1995. In addition,the HTE code enforcement module will be installed; automating what was once a manually process. Also, the police and fire departments are reviewing public safety software with the intent of replacing their outdated software before the end of 1995. These new software systems are designed to increase our efficiency and the amount of information available. 7 CITY OF FRIDLEY, MINNESOTA FINANCIAL INFORMATION PLANS FOR THE FUTURE (CONTINUED) During 1995, the City and HRA will be working together to acquire and redevelop a fourteen acre site at the intersection of University and Mississippi Avenues. This area, known as the Southwest Quadrant, — currently contains several apartment buildings and small retail establishments. These properties will be acquired in 1995, demolished and replaced with a combination of townhomes and senior condominiums. One of the businesses being displaced by this development is the City's liquor warehouse store. During 1995, the City will be reviewing potential new locations and should begin — construction of a new liquor store in the summer or fall. Significant projects budgeted for 1995 in the five year capital improvement plan include: selection and — installation of an optical disk imaging to archive City records; ballfield safety improvements to protect participants an spectators while using City facilities; Street reconstruction including concrete curb and gutter with new asphalt pavement on a number of City streets; relining sanitary and storm sewer pipes — to decrease inflow and outflow; redesigning and rebuilding of old lift stations; and the annual sealcoating, well, reservoir and pump house maintenance programs. 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, Special Revenue and Capital Improvement Capital Project 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. 8 CITY OF FRIDLEY, MINNESOTA FINANCIAL INFORMATION (CONTINUED) — CASH MANAGEMENT All temporary cash surpluses during the year are invested in various securities which 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 2.02%to 11.62%. DEBT ADMINISTRATION Net general bonded debt per capita, and the percentage of the net general bonded debt to taxable value are useful indicators of the City's debt position. At December 31, 1994 the City of Fridley's debt service funds provided sufficient capital to cover the net general bonded debt. The City has numerous debt issues outstanding totalling $19,727,857. Of this outstanding debt, $1,725,000 represents special assessment debt with government commitment, $11,435,000 represents general obligation tax increment refunding bonds, $4,030,000 relates to tax increment issues supported by revenue from the established tax increment areas, $2,410,000 represents general obligation water, sewer and storm water revenue bonds and $127,857 represents a construction loan from the State of Minnesota During 1994, the City retired the remaining portion of the 1982 Special Assessment Bonds -. and the 1986 Crossover Refunding Bonds by exercising the call provision contained in the bond resolution. The City of Fridley has, since 1982, maintained a credit rating of a Aa1 on its long-term bonds. FISCAL DISPARITIES The commonly referred to 'Fiscal Disparity Law' was adopted by the Legislature in 1971. The area of the fiscal disparity district encompasses all the properties located within the seven-county metropolitan area The law provides that 40% of all new commercial/industrial property valuations or growth be placed in an areawide 'pool', and shared according to specific criteria TAX INCREMENT DISTRICTS The City Council took action on May 7, 1979 to form the first of twelve tax increment districts. In 1985, the individual districts were combined into one redevelopment district to more easily manage the overall activities. All of the districts have been established in economically depressed areas within the City. With the successful relationship that the City and the Housing and Redevelopment Authority have developed, many redevelopment projects have occurred resulting in a number of benefits to the City. GENERAL GOVERNMENT FUNCTIONS The following schedule presents a summary of the General, Special Revenue, Debt Service, Capital Projects and Expendable Trust Funds' revenues for the fiscal year ended December 31, 1994. 9 CITY OF FRIDLEY, MINNESOTA FINANCIAL INFORMATION (CONTINUED) GENERAL GOVERNMENT FUNCTIONS (CONTINUED) — Percent Increase/ — Revenues Amount of Total (Decrease) Taxes and special assessments $6,915,475 47.08% ($605,920) Licenses and permits 528,111 3.60% 117,976 — Intergovernmental 3,808,828 25.94% (609,007) Charges for services 1,038,863 7.07% 110,127 Fines and forfeits 185,420 1.26% (18,372) Interest on investments 1,938,810 13.20% (1,095,679) Miscellaneous 272,118 1.85% (114,306) Total $14,687,625 100.00% ($2,215,181) The most significant changes in revenues from the prior year were in taxes and special assessments, intergovernmental and interest revenue categories. The large decrease in taxes and special — assessments is due to an increase in delinquent tax and special assessment collections during 1993 relating to the HRA's purchase of the Lake Pointe Property. In addition, tax increment revenues decreased due to the expiration of two districts on December 31, 1993. Intergovernmental revenue's _ decrease results from the City receiving $887,280 less in state construction money than was received in 1993 due to less work being done on streets with a state aid designation. This decrease is in part offset by an increase in Community Development Block Grant revenues resulting from increasing programs during 1994. Finally, interest on investments decreased significantly due to much lower — interest rates during 1994 and the City liquidating several investments during 1993 whose rates were substantially higher than the market. The following schedule presents a summary of the General, Special Revenue, Debt Service, Capital Projects and Expendable Trust Funds' expenditures for the fiscal year ended December 31, 1994. Percent Expenditures Amount of Total Increase — Current: General government $3,206,942 18.99% $594,001 Public safety 3,552,812 21.04% 139,515 — Civic center 180,104 1.07% 10,611 Public works 2,473,128 14.65% 96,138 Community development 462,615 2.74% 55,145 Recreation and naturalist 780,242 4.62% 59,483 Debt service 3,495,789 20.71% 1,287,898 Capital outlay 2,731,530 16.18% 649,237 — Total $16,883,162 100.00% $2,892,028 10 CITY OF FRIDLEY, MINNESOTA FINANCIAL INFORMATION (CONTINUED) GENERAL GOVERNMENT FUNCTIONS (CONTINUED) The most significant change is in the general government, debt service and capital outlay categories. — The general government increase is due to a new home rehabilitation program made available during 1994 with Community Development Block Grant (CDBG) Funds. This program increased expenditures from this grant by $233,314. In addition, HRA expenditures increased due to new housing programs, acquistion and demolition of scattered sites and the beginning of the Southwest Quadrant project. The large increase in debt service resulted from calling two bond issues in early 1994. The City expended $1,865,000 to call the 1980 Special Assessment Bonds and the 1986 Crossover Refunding Bonds. The increase in capital outlay is due to the replacement of the Locke Lake Dam at a cost of $477,348. Excluding capital outlay, the increased, full reimbursed CDBG expenditures and debt service expenditures, the overall increase in other categories is 7.4%which is reasonable given inflation of the new programs initiated by the HRA. General Fund Balance The fund balance is used to provide working capital for the fund until tax settlements and state aids are received in July and December of each year,to provide funds for unknown events which could have an adverse effect on the fund, and to help finance future budgets. In 1990 the City Council adopted a formal policy designating portions of the general fund's fund balance for working capital, subsequent .... years expenditures, contingencies and for replacement of fixed assets at the end of each fiscal year. ENTERPRISE OPERATIONS The Enterprise Funds account for the financing of services to the general public in which all or most of the costs involved are paid in the form of charges by the users of such services. In the City of Fridley, Enterprise Funds are used to account for the operation of the public utility system and two municipal liquor stores. Except for ownership, Enterprise Funds bear a close resemblance to privately owned utility or service enterprises. Liquor Fund The Liquor Fund was established to account for the operation and financing of the City-owned municipal liquor stores. The City operates two liquor stores, one at 6289 Highway 65, and the other at 214 Mississippi Street. The City owns the store at the Highway 65 location and currently has a lease with one year options at the other store. In 1984, the City changed its sales philosophy to the wholesale approach so that we could remain competitive with the three neighboring communities which _. use wholesale pricing. Retained earnings of the Liquor Fund were $1,539,095 on December 31, 1994 as compared to $1,407,355 at the closing of the last fiscal year. Income before operating transfers increased from $132,503 in 1993 to $156,740 in 1994. Public Utility Fund This fund accounts for the operation and financing of the City-owned sewer and water systems. Included in the assets of the fund is a receivable from the Metropolitan Waste Control Commission of $121,849 representing the City's share of the equity in the Minneapolis Sewer System which was acquired by the Commission on January 1, 1971. This amount will be paid to the City by means of issuing credits against future sewer billings from the Commission. These credits will be applied in annual installments with interest through 1999. 11 CITY OF FRIDLEY, MINNESOTA FINANCIAL INFORMATION (CONTINUED) ENTERPRISE OPERATIONS (CONTINUED) The assets for the Water and Sewer Distribution system, originally financed by special assessments, were transferred from General Fixed Assets to the Public Utility Fund in 1978. Additional Fixed Assets were transferred in 1979, 1984, 1989, 1990, 1991, 1992, 1993 and 1994. Those improvements to the — utility system paid for or financed directly by the Public Utility Fund have always been carried in the Public Utility Fund and depreciated. Retained earnings on December 31, 1994 were $10,390,651 compared to $10,102,668 at the closing of the last fiscal year. — RISK MANAGEMENT The Self Insurance Fund was set up to account for all revenues and expenditures associated with the — $100,000 deductible on the general liability policy. Self insuring a larger deductible has reduced the annual premiums which allow us to directly benefit from our good experience rating. In the future an analysis will be made of 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 five pension plans: 1) Fridley Fire Relief Association for Volunteer Firemen. 2) Public Employees Police and Fire Consolidation Plan for police officers hired prior to December 15, 1975. — 3) Public Employees Retirement Police and Fire Plan, covering the City's full-time Firemen and Police Officers hired after December 15, 1975. — 4) The basic Public Employees Retirement Plan, which covers certain other City civilian employees. 5) Coordinated Public Employees Retirement Plan, which covers the balance of the City civilian employees. The employees covered by the Coordinated P.E.R.A. 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 Department of the State of Minnesota. This requirement has been complied with and the opinion of Tautges, Redpath & Co., Ltd., is included in this report. — 12 CITY OF FRIDLEY, MINNESOTA OTHER INFORMATION (CONTINUED) CERTIFICATE OF ACHIEVEMENT FOR EXCELLENCE 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 December 31, 1993. The Certificate of Achievement is a prestigious national award recognizing conformance with the highest standards for preparation of State and local government financial reports. In order to be awarded a Certificate of Achievement, a governmental unit must publish an easily readable and efficiently organized comprehensive annual financial report, whose contents conform to program standards. Such reports 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 report continues to conform to the Certificate of Achievement Program requirements, and we are submitting it to GFOA to determine its eligibility for another certificate. ACKNOWLEDGEMENTS 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 Donna Tjornhom, Paul Hansen, Craig Ellestad and Marcy Everette and to our auditors Tautges, Redpath&Co., _ Ltd. for their professional guidance. We would also like to express our appreciation to the Mayor and members of the City Council for their interest and support in planning and conducting the financial operations of the City in a responsible and progressive manner. Respectfully submitted, 12L-AD. Pal //atileAdi (°./.1 Richard D. Pribyl Howard D. Koolick Finance Director Assistant Finance Director 13 Certificate of Achievement for Excellence in Financial Reporting Presented to City of Fridley, Minnesota For its Comprehensive Annual Financial Report for the Fiscal Year Ended December 31, 1993 A Certificate of Achievement for Excellence in Financial Reporting is presented by the Government Finance Officers Association of the United States and Canada to government units and public employee retirement systems whose comprehensive annual financial reports(CAFRs)achieve the highest standards in government accounting and financial reporting. 4. 9 101®STALES W+ MID y X x" A President IDRPORA1010 s �.. *oust CG Executive Director 15 FINANCIAL SECTION i NMI T OMR AUDITOR'S OPINION TAUTGES, REDPATH & CO., LTD. CERTIFIED PUBLIC ACCOUNTANTS INDEPENDENT AUDITOR'S REPORT To the Honorable Mayor and Members of the City Council City of Fridley,Minnesota We have audited the accompanying general purpose financial statements of the City of Fridley, Minnesota,as of and for the year ended December 31, 1994 as listed in the table of contents. These general purpose financial statements are the responsibility of the City's management. Our responsibility is to express an opinion on these general purpose financial statements based on our audit. We conducted our audit in accordance with generally accepted auditing standards and Government Auditing Standards,issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement. An audit includes examining,on a test basis,evidence supporting the amounts and disclosures in the general purpose financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management,as well as evaluating the overall general purpose fmancial statement presentation. We believe that our audit provides a reasonable basis for our opinion. In our opinion,the general purpose financial statements referred to above present fairly,in all material respects,the financial position of the City of Fridley,Minnesota,as of December 31, 1994, and the results of its operations and cash flows of its proprietary fund types for the year then ended in conformity with generally accepted accounting principles. Our audit was made for the purpose of forming an opinion on the general purpose financial statements taken as a whole.The combining and individual fund and account group fmancial statements,supporting schedules and statistical information listed in the table of contents are presented for purposes of additional analysis and are not a required part of the general purpose financial statements of the City of Fridley,Minnesota. Such information,except for that portion marked "unaudited," on which we express no opinion,has been subjected to the auditing procedures applied in the audit of the general purpose financial statements and,in our opinion,is fairly stated in all material respects in relation to the general purpose financial statements taken as a whole. June 7, 1995 0',u 4 Atlfit,14 i C. l' ' TAUTGES,REDPATH&CO.,LTD. Certified Public Accountants 17 4810 White Bear Parkway • White Bear Lake, Minnesota 55110 • 612/426-7000 • FAX/426-5004 • Member of HLB International • COMBINED FINANCIAL STATEMENTS The combined statements are intended to provide an overview and broad perspective of the City's financial position and operations. These statements present a summary set of information needed to control and analyze current operations to determine compliance with legal and budgetary limitations and to assist in financial planning. The following combined statements are presented: Combined Balance Sheet - All Fund Types and Account Groups Combined Statement of Revenues, Expenditures, and Changes in Fund Balances - All Governmental Fund Types and Expendable Trust Funds Combined Statement of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual - General and Special Revenue Fund Types Combined Statement of Revenues, Expenditures, and Changes in Retained Earnings - All Proprietary Fund Types Combined Statement of Cash Flows - All Proprietary Fund Types 11 CITY OF FRIDLEY, MINNESOTA — COMBINED BALANCE SHEET-ALL FUND TYPES AND ACCOUNT GROUPS December 31, 1994 Governmental Fund Types Special Debt Capital General Revenue Service Projects Assets Cash and cash equivalents $994 $28,077 $1,061,695 $14,305 Investments 6,969,899 168,118 9,462,421 17,431,661 Receivables: Accounts 30,220 36,646 650 Taxes 46,015 428,407 Special assessments 4,877 2,294,435 48,763 — Mortgage 6,614 1,134,807 Interest 331,603 90,695 Loan 6,300 — Developer note 137,962 Due from other funds 12,677 Due from other governments 46,068 188,258 — Inventories, at cost 21,992 Prepaid items 97,779 Long term receivable Other assets Property and equipment (Net of depreciation) — Amount available in debt service fund Amount to be provided for — retirement of general long term debt — Total Assets $7,693,709 $440,390 $12,818,551 $19,149,288 See Accompanying Notes to Financial Statements 20 _ Exhibit A-1 Fiduciary — Proprietary Fund Types Fund Types Account Groups Totals Internal Trust and General General Long (Memorandum Only) Enterprise Service Agency Fixed Assets Term Debt 1994 1993 — — $4,881,456 $5,077 $ $ $ $5,991,604 $8,732,030 456,903 2,789,277 58,967 37,337,246 37,076,316 1,085,676 3,019 1,156,211 1,193,846 423 474,845 664,707 2,348,075 2,567,653 "" 1,141,421 1,084,036 422,298 323,680 6,300 6,300 — 137,962 137,730 235,460 926,498 1,174,635 1,505,370 21,311 255,637 155,252 _ 335,187 357,179 303,746 257,963 355,742 283,329 439,249 439,249 213,540 — 4,701,218 4,701,218 4,520,377 19,915,769 257,837 28,220,880 48,394,486 50,986,823 — 10,524,906 10,524,906 12,838,703 — 6,819,432 6,819,432 6,637,839 $27,628,974 $3,978,689 $4,763,627 $28,220,880 $17,344,338 $122,038,446 $129,231,277 21 CITY OF FRIDLEY, MINNESOTA COMBINED BALANCE SHEET-ALL FUND TYPES AND ACCOUNT GROUPS(CONTINUED) December 31, 1994 —' Governmental Fund Types Special Debt Capital General Revenue Service Projects — Liabilities,fund equity and other credits — Liabilities Accounts payable $138,418 $44,905 $102 $40,699 — Deposits payable 3,478 85,500 77,088 Contracts payable 157,268 Salaries payable 126,128 2,663 — Compensated absences payable Deferred revenue 35,528 2,291,242 383,815 Due to other funds 249,605 84,022 670,799 — Due to other governments 5,858 121 2,301 296,337 Bonds payable Loans payables — Other liabilities Total liabilities 559,015 217,211 2,293,645 1,626,006 Fund equity and other credits Contributed capital Investment in general fixed assets — Retained earnings- Reserved Unreserved- — Designated Undesignated Fund balance: -, Reserved 331,464 9,800 1,544,123 10,539,426 Unreserved- Designated 6,574,914 213,379 7,557,895 — Undesignated 228,316 8,980,783 (574,039) Total equity and other credits 7,134,694 223,179 10,524,906 17,523,282 — Total liabilities,equity and other credits $7,693,709 $440,390 $12,818,551 $19,149,288 — — See Accompanying Notes to Financial Statements 22 Exhibit A-1 Continued Fiduciary _ Proprietary Fund Types Fund Types Account Groups Totals Internal Trust and General General Long (Memorandum Only) Enterprise Service Agency Fixed Assets Term Debt 1994 1993 $206,063 $5,215 $ $ $ $435,402 $358,085 4,737,117 4,903,183 4,661,216 9,680 166,948 241,542 12,790 57,707 199,288 209,061 - 820,755 820,755 815,003 2,710,585 3,078,795 170,106 103 1,174,635 1,505,370 416,274 8,726 729,617 822,153 2,410,000 17,190,000 19,600,000 21,500,000 127,857 127,857 131,542 - 52,624 26,481 79,105 53,830 3,107,431 1,053,783 4,745,946 17,344,338 30,947,375 33,376,597 - 12,591,797 2,008,743 14,600,540 13,474,387 28,220,880 28,220,880 31,995,993 - 2,259,000 160,899 2,419,899 2,751,965 - 755,264 755,264 604,954 9,670,746 9,670,746 9,026,420 - 12,424,813 14,283,947 14,346,188 13,617,323 17,681 8,652,741 10,099,691 24,521,543 2,924,906 17,681 28,220,880 91,091,071 95,854,680 $27,628,974 $3,978,689 $4,763,627 $28,220,880 $17,344,338 $122,038,446 $129,231,277 23 CITY OF FRIDLEY, MINNESOTA COMBINED STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND - BALANCES-ALL GOVERNMENTAL FUND TYPES AND EXPENDABLE TRUST FUNDS Year Ended December 31, 1994 - Governmental Fund Types Special Debt - General Revenue Service • Revenues: - Taxes $3,529,356 $ $ Special assessments 3,975 478,634 Licenses and permits 439,237 88,874 - Intergovernmental revenue 3,109,846 380,850 Charges for services 892,471 146,392 Fines and forfeits 184,024 1,396 - Interest on investments 402,563 8,613 529,214 Miscellaneous 185,196 2,312 Total revenues 8,746,668 628,437 1,007,848 - Expenditures: Current ,_ General government 1,630,467 730,672 Public safety 3,549,978 2,834 Municipal center 180,104 - Public works 2,144,797 Community development 462,615 Recreation and naturalist 780,242 Debt service 14,572 3,452,551 - Capital outlay 274,929 437,625 Total expenditures 9,037,704 1,171,131 3,452,551 - Excess(deficiency)of revenues over expenditures (291,036) (542,694) (2,444,703) Other financing sources(uses): - Bond proceeds 2,309 Capital lease obligation 38,500 Issuance of long term note receivable 9,414 - Operating transfers in 473,414 540,705 1,304,368 Operating transfers out (363,486) Total other financing sources(uses) 521,328 540,705 943,191 - Excess(deficiency)of revenues and other financing sources over expenditures and other financing uses 230,292 (1,989) (1,501,512) Fund Balance January 1 6,904,402 225,168 12,838,703 - Residual Equity Transfers in Residual Equity Transfers out (812,285) - Fund Balance December 31 $7,134,694 $223,179 $10,524,906 See Accompanying Notes to Financial Statements - 24 _ Exhibit A-2 Fiduciary Fund Type Totals Capital (Memorandum Only) Projects Trust 1994 1993 $2,804,822 $ $6,334,178 $6,906,749 98,688 581,297 614,646 528,111 410,135 318,132 3,808,828 4,417,835 1,038,863 928,736 185,420 203,792 - 995,535 2,885 1,938,810 3,034,489 84,610 272,118 386,424 4,301,787 2,885 14,687,625 16,902,806 845,803 3,206,942 2,612,941 3,552,812 3,413,297 180,104 169,493 328,331 2,473,128 2,376,990 '- 462,615 407,470 780,242 720,759 28,666 3,495,789 2,207,891 2,018,976 2,731,530 2,082,293 3,221,776 16,883,162 13,991,134 1,080,011 2,885 (2,195,537) 2,911,672 155,380 157,689 38,500 9,414 895,295 3,213,782 3,046,077 (2,625,296) (2,988,782) (2,946,077) (1,574,621) 430,603 100,000 (494,610) 2,885 (1,764,934) 3,011,672 18,017,892 14,796 38,000,961 34,989,289 13,984 (812,285) (13,984) $17,523,282 $17,681 $35,423,742 $38,000,961 25 CITY OF FRIDLEY. MINNESOTA, COMBINED STATEMENT OF REVENUES, EXPENDITURES,AND CHANGES - IN FUND BALANCES- BUDGET AND ACTUAL GENERAL,SPECIAL REVENUE FUND AND BUDGETED CAPITAL PROJECT TYPES(CONTINUED) _ Year Ended December 31, 1994 With comparative totals for year ended December 31, 1993 General Fund Variance Favorable - Budget Actual (Unfavorable) Revenues: - Taxes $3,556,148 $3,529,356 ($26,792) Special assessments 1,896 3,975 2,079 Licenses and permits 420,626 439,237 18,611 Intergovernmental revenue 3,054,262 3,109,846 55,584 Charges for services 849,445 892,471 43,026 Fines and forfeits 242,392 184,024 (58,368) Interest on investments 430,000 402,563 (27,437) Miscellaneous 155,232 185,196 29,964 Total revenues 8,710,001 8,746,668 36,667 Expenditures: Current - General government 1,772,365 1,630,467 141,898 Public safety 3,661,846 3,549,978 111,868 Municipal center 187,774 180,104 7,670 Public works 2,196,164 2,144,797 51,367 Community development 481,579 462,615 18,964 Recreation and naturalist 816,124 780,242 35,882 Reserve for contingency 41,919 41,919 Debt service 18,830 14,572 4,258 Capital outlay 282,303 274,929 7,374 Total expenditures 9,458,904 9,037,704 421,200 Excess(deficiency)of revenues over expenditures (748,903) (291,036) 457,867 Other financing sources(uses): Capital lease obligation 38,999 38,500 (499) Issuance of long term note receivable 9,414 9,414 Operating transfers in 473,414 473,414 - Operating transfers out Total other financing sources(uses) 512,413 521,328 8,915 Excess(deficiency)of revenues and other -- financing sources over expenditures and other financing uses (236,490) 230,292 466,782 - Fund balance January 1 6,904,402 6,904,402 Residual equity transfer in(out) Fund Balance December 31 $6,667,912 $7,134,694 $466,782 See Accompanying Notes to Financial Statements 26 Exhibit A-3 - Special Revenue Fund Types Budgeted Capital Project Funds Variance Variance Favorable Favorable _ Budget Actual (Unfavorable) Budget Actual (Unfavorable) $ $ $ $70,550 $70,801 $251 - 91,369 88,874 (2,495) - 203,211 380,850 177,639 615,000 318,132 (296,868) 144,320 146,392 2,072 1,396 1,396 5,865 8,613 2,748 418,672 475,046 56,374 - 253 2,312 2,059 10,000 36,742 26,742 446,414 628,437 182,023 1,114,222 900,721 (213,501) 748,438 730,672 17,766 - 2,834 2,834 250,916 202,268 48,648 440,479 437,625 2,854 1,457,834 750,723 707,111 1,191,751 1,171,131 20,620 1,708,750 952,991 755,759 - (745,337) (542,694) 202,643 (594,528) (52,270) 542,258 540,705 540,705 (895,295) (895,295) - 540,705 540,705 (895,295) (895,295) (204,632) (1,989) 202,643 (1,489,823) (947,565) 542,258 225,168 225,168 9,370,813 9,370,813 - $20,536 $223,179 $202,643 $7,880,990 $8,423,248 $542,258 27 - Exhibit A-3 CITY OF FRIDLEY, MINNESOTA Continued COMBINED STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES- BUDGET AND ACTUAL - GENERAL, SPECIAL REVENUE FUND AND BUDGETED CAPITAL PROJECT TYPES(CONTINUED) Year Ended December 31, 1994 - With comparative totals for year ended December 31, 1993 (Memorandum Only) - Variance- Favorable 1993 Budget Actual (Unfavorable) Actual _ Revenues: Taxes $3,626,698 $3,600,157 ($26,541) $3,742,354 Special assessments 1,896 3,975 2,079 2,896 - Licenses and permits 511,995 528,111 16,116 410,135 Intergovernmental revenue 3,872,473 3,808,828 (63,645) 4,417,835 Charges for services 993,765 1,038,863 45,098 889,275 Fines and forfeits 243,788 185,420 (58,368) 203,792 Interest on investments 854,537 886,222 31,685 1,418,370 Miscellaneous 165,485 224,250 58,765 311,555 - Total revenues 10,270,637 10,275,826 5,189 11,396,212 - Expenditures: Current General government 2,520,803 2,361,139 159,664 1,973,165 Public safety 3,915,596 3,755,080 160,516 3,413,297 - Municipal center 187,774 180,104 7,670 169,493 Public works 2,196,164 2,144,797 51,367 2,250,523 Community development 481,579 462,615 18,964 407,470 - Recreation and naturalist 816,124 780,242 35,882 720,759 Reserve for contingency 41,919 41,919 Debt service 18,830 14,572 4,258 - Capital outlay 2,180,616 1,463,277 717,339 767,434 Total expenditures 12,359,405 11,161,826 1,197,579 9,702,141 - Excess(deficiency)of revenues over expenditures (2,088,768) (886,000) 1,202,768 1,694,071 Other financing sources(uses): Capital lease obligation 38,999 38,500 (499) Issuance of long term note receivable 9,414 9,414 - Operating transfers in 118,824 118,824 479,359 Operating transfers out (625,750) Total other financing sources(uses) 157,823 166,738 8,915 (146,391) - Excess(deficiency)of revenues and other financing sources over expenditures and other financing uses (1,930,945) (719,262) 1,211,683 1,547,680 Fund balance January 1 16,500,383 16,500,383 14,938,719 - Residual equity transfer in(out) 13,984 Fund Balance December 31 $14,569,438 $15,781,121 $1,211,683 $16,500,383 See Accompanying Notes to Financial Statements 28 _ Exhibit A-4 CITY OF FRIDLEY, MINNESOTA COMBINED STATEMENT OF REVENUES, EXPENSES AND CHANGES _ IN RETAINED EARNINGS-ALL PROPRIETARY FUND TYPES Year Ended December 31, 1994 With Comparative Totals for Year Ended December 31, 1993 - Proprietary Fund Types Totals Internal (Memorandum Only) Enterprise Service 1994 1993 Sales and cost of sales: Sales $3,083,966 $ $3,083,966 $2,783,611 Cost of sales 2,486,129 2,486,129 2,214,716 Gross profit 597,837 597,837 568,895 Operating revenues: - Water sales and sewer rents 3,871,358 3,871,358 3,436,041 Other 114,254 140,607 254,861 228,548 Charges for services 80,121 80,121 29,075 - Total operating revenues 3,985,612 220,728 4,206,340 3,693,664 Operating expenses: - Personal services 1,053,440 52,475 1,105,915 1,057,758 Supplies and other charges 3,326,869 70,885 3,397,754 3,281,823 Depreciation 653,576 64,949 718,525 602,730 - Total operating expenses 5,033,885 188,309 5,222,194 4,942,311 Operating(loss) (450,436) 32,419 (418,017) (679,752) - Non-operating revenues(expenses): Interest on investments 284,721 150,447 435,168 711,101 Debt service (141,196) (141,196) (129,944) - Other 27,697 27,697 7,374 Total non-operating revenues (expenses) 171,222 150,447 321,669 579,179 Income before operating transfers (279,214) 182,866 (96,348) (91,221) - Operating transfers out (25,000) (200,000) (225,000) (100,000) Total operating transfers (25,000) (200,000) (225,000) (100,000) - Net income before extraordinary item (304,214) (17,134) (321,348) (191,221) Extraordinary gain on issuance of sewer _ availability charge credits 364,000 364,000 Net income(loss) 59,786 (17,134) 42,652 (191,221) _ Credit arising from transfer of depreciation on contributed capital 359,937 59,981 419,918 337,065 _ Retained earnings January 1 $11,510,023 $873,316 12,383,339 12,237,495 Retained earnings December 31 $11,929,746 $916,163 $12,845,909 $12,383,339 See Accompanying Notes to Financial Statements 29 Exhibit A-5 CITY OF FRIDLEY, MINNESOTA COMBINED STATEMENT OF CASH FLOWS - ALL PROPRIETARY FUND TYPES Year Ended December 31, 1994, With Comparative Totals for Year Ended December 31, 1993 - - Proprietary Fund Types Totals Internal (Memorandum Only) Enterprise Service 1994 1993 Cash flows from operating activities: Operating income(loss) ($450,436) $32,419 ($418,017) ($679,752) Adjustments to reconcile operating income(loss)to net cash flows from operating activities: Depreciation 653,576 64,949 718,525 602,730 Changes in assets and liabilities: Decrease (increase) in receivables 76,563 76,563 (167,838) Decrease(increase)in due from other funds (233,340) (720,836) (954,176) 141,524 Decrease(increase) in inventories (57,416) (57,416) (2,338) Decrease(increase) in prepaid items (34,463) (34,463) (18,553) Increase(decrease) in payables (121,908) 181,196 59,288 160,320 - Other non-operating income 27,697 27,697 7,374 Use of sewer availability charge credits 115,200 115,200 56,250 Net cash flows from operating activities (24,527) (442,272) (466,799) 99,717 Cash flows from non-capital financing activities: - Operating transfers out (25,000) (200,000) (225,000) (100,000) Net cash flows from non-capital financing activities: (25,000) (200,000) (225,000) (100,000) Cash flows from capital and related financing activities: Acquisition and construction of fixed assets (1,101,168) (66,347) (1,167,515) (671,001) Contributed Capital 812,285 812,285 Proceeds from sale of revenue bonds 335,000 335,000 Principal paid on revenue bonds (80,000) (80,000) (45,000) Interest and paying agent fees on revenue bonds (141,196) (141,196) (129,944) Net cash flows from capital and financing activities (987,364) 745,938 (241,426) (845,945) See Accompanying Notes to Financial Statements 30 Exhibit A-5 CITY OF FRIDLEY. MINNESOTA Continued COMBINED STATEMENT OF CASH FLOWS ALL PROPRIETARY FUND TYPES(CONTINUED). Year Ended December 31. 1994 With Comparative Totals for Year Ended December 31, 1993 Proprietary Fund Types Totals Internal (Memorandum Only) Enterprise Service 1994 1993 Cash flows from investing activities: Purchase of investment securities (456,903) (1,572,433) (2,029,336) (77,335) Proceeds from sale of investment securities 4,277,999 Interest on investments 284,641 150,447 435,088 703,839 Interest received from MWCC 80 80 7,262 ... Net cash flows from investing activities (172,182) (1,421,986) (1,594,168) 4,911,765 Net increase(decrease)in cash and cash equivalents (1,209,073) (1,318,320) (2,527,393) 4,065,537 Cash and cash equivalents-January 1 6,090,529 1,323,397 7,413,926 3,348,389 Cash and cash equivalents-December 31 $4,881,456 $5,077 $4,886,533 $7,413,926 Non-cash investing. capital and financing activities: System assets of$477,347 were contributed by the Capital Projects Special Assessment Fund to the Public Utility Enterprise Fund in 1994. A receivable for sewer availability charge credits from Metropolitan Council Wastewater Services, in the amount of$364,000,was recognized in the Public Utility Enterprise Fund in 1994. Computer equipment of$256,439 was contributed from the General Fixed Assets Account Group to the Information Systems Internal Service Fund during 1994. — See Accompanying Notes to Financial Statements 31 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 1994 ._ 1. Summary of Significant Accounting Policies The City of Fridley 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 accounting policies of the City of Fridley conform to generally accepted accounting policies applicable to governmental units. The following is a summary of the more significant policies: A. Principles used in the determination of the scope of the Governmental entity — The City has implemented Government Accounting Standards Boards Statement 14, The Financial Reporting Entity. As required by Statement 14,these financial statements present the City and its component units. The component unit discussed below is included in the reporting entity because of the significance of their operation and financial relationship with the City. Blended Component Unit - The Fridley Housing and Redevelopment Authority (HRA) is — governed by commissioners appointed by the Fridley City Council. Although it is legally separate from the City, the HRA is reported as if it were a part of the City because its sole purpose is to provide housing and redevelopment assistance to the City's residents. The majority of funding for the various programs administered by the HRA is provided through the issuance of general obligation tax increment bonds guaranteed by the City. Complete financial statements of the HRA may be obtained from William W. Burns, Executive Director, 6431 University Avenue NE, Fridley, Minnesota 55432. The following governmental entities are not included in these financial statements since they do not meet the criteria contained in Statement 14: — Independent School District #11/Independent School District #13/Independent School District #14/Independent School District#16 -These four school districts either reside wholly within the City of Fridley or overlap within the city boundaries. According to Minnesota State Statutes, Minnesota school districts are totally independent of all other governing jurisdictions. The City has no authority to appoint board members and has no fiscal responsibility. School districts are able to levy taxes and issue debt in their own name. Fridley Police and Volunteer Firefighters Relief Associations - These associations are organized as non-profit organizations by their members to provide pension and other benefits — to such members in accordance with Minnesota Statutes. Their boards of directors are elected by the membership of the association. All funding is conducted in accordance with Minnesota Statutes, whereby state aids flow to the associations, tax levies are determined by the associations and are only reviewed by the City. The associations pay benefits directly to their members. The associations may certify tax levies to the County directly if the City does not carry out this function. Because the associations are able to fund their programs independently of the City, they are excluded from these financial statements. (See Notes 9 and 10 for disclosures relating to the pension plans operated by these organizations.) 32 CITY OF FRIDLEY, MINNESOTA _ NOTES TO FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31, 1994 1. Summary of Significant Accounting Policies (Continued) B. Fund Accounting The accounts of the City are organized on the basis of funds and account groups, each of which is considered a separate accounting entity. The operations of each fund are accounted for with a separate set of self-balancing accounts that comprise its assets, liabilities, fund equity, revenues and expenditures, or expenses, as appropriate. Government resources are allocated to and accounted for in individual funds based upon the purposes for which they are to be spent and the means by which spending activities are controlled. The various funds are .... grouped, in the financial statements in this report, into seven generic fund types and three broad categories as follows: GOVERNMENTAL FUNDS Governmental funds include the general fund, special revenue funds, debt service funds and capital projects funds. The governmental fund measurement focus is based upon the determination of financial position and changes in financial position (sources, uses and balances of financial resources rather than upon net income determination). These funds are maintained on the modified accrual basis of accounting (explained further under Significant Accounting Policies). General Fund - The General Fund is the primary operating fund of the City. It is used to account for all financial resources except those required to be accounted for in another fund. Special Revenue Funds - Special Revenue Funds are used to account for the proceeds of certain specific revenue sources that are restricted to expenditures for specified purposes. Debt Service Funds - Debt Service Funds are used to account for the accumulation of resources for, and the payment of, general long-term debt principal, interest, and related costs. '— Capital Projects Funds - Capital Projects Funds are used for the acquisition or construction of major capital facilities other than those financed by proprietary funds. — PROPRIETARY FUNDS Proprietary funds include enterprise funds and internal service funds. The proprietary fund measurement focus is based upon the determination of net income, financial position and changes in financial position. The generally accepted accounting principles here are those applicable to similar businesses in the private sector and thus these funds are maintained on the accrual basis of accounting. Enterprise Funds - Enterprise Funds are used to account for operations that are financed and operated in a manner similar to private business enterprises -where the intent is that the costs (expenses, including depreciation) of providing goods or services to the general public on a continuing basis be financed or recovered primarily through use charges. Internal Service Funds - Internal Service Funds are used to account for the financing of goods or services provided by one department to other departments of the City on a cost- reimbursement basis. 33 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31, 1994 • 1. Summary of Significant Accounting Policies (Continued) B. Fund Accounting (Continued) FIDUCIARY FUNDS Fiduciary funds include expendable trust and agency funds. The measurement focus of the -� expendable trust funds is the same as governmental funds and is, therefore, maintained on the modified accrual basis of accounting. Trust Fund - The Trust Fund is used to account for assets held by the City in a trustee capacity for individuals, private organizations, other governments, and/or all other funds. The City's Trust Fund is classified as an Expendable Trust Fund and is accounted for in essentially the same manner as governmental funds. Agency Funds - Agency Funds are clearing type funds for the collection of taxes or deposits held in trust, on behalf of individuals, private organizations and other governments. The funds — are custodial in nature (assets equal liabilities) and do not involve measurement of results of operation. C. Measurement Focus The accounting and reporting treatment applied to a fund is determined by its measurement focus. All governmental funds and expendable trust funds are accounted for on a spending or "current financial resources' measurement focus. This means that only current assets and current liabilities are generally included on the balance sheets. (Their reported fund balance is considered a measure of 'available spendable resources'.) Governmental fund operating .., statements present increases (revenues and other financing sources) and decreases (expenditures and other financing uses) in net current assets. Accordingly, they are said to present a summary of sources and uses of 'available spendable resources' during a period. Fixed assets used in governmental fund type operations (general fixed assets) are recorded at historical costs and accounted for in the General Fixed Assets Account Group. Public domain ("infrastructure') general fixed assets consisting of roads, bridges, curbs and gutters, are ., capitalized along with other general fixed assets. No depreciation has been provided on general fixed assets. Long-term liabilities expected to be financed from governmental funds are accounted for in the General Long-Term Debt Account Group, not in the governmental funds. These two account groups are not 'funds'. They are concerned only with the measurement of financial position. They are not involved with measurement of results of operations. Noncurrent portions of long-term receivables due to governmental funds are reported on their ._ balance sheets, in spite of their measurement focus. However, special reporting treatments are used to indicate in all governmental funds that they should not be considered 'available spendable resources', since they do not represent net current assets. Recognition of revenues in these funds represented by noncurrent receivables is deferred until they become current receivables. 34 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31, 1994 1. Summary of Significant Accounting Policies (Continued) C. Measurement Focus (Continued) Because of their spending measurement focus, expenditure recognition for governmental fund types excludes amounts represented by noncurrent liabilities. Since they do not affect net current assets, such long-term amounts are not recognized as governmental fund type expenditures or fund liabilities. They are instead reported as liabilities in the General Long- Term Debt Account Group. Proprietary funds are accounted for on a cost of services or'capital maintenance'measurement focus. This means that all assets, including fixed assets, and all liabilities, including long-term — liabilities, associated with their activity are included on their balance sheets. Their reported fund equity is segregated into contributed capital and retained earnings components. Proprietary fund type operating statements present increases (revenues) and decreases (expenses) in net .... total assets. D. Basis of Accounting Basis of accounting refers to when revenues and expenditures or expenses are recognized in the accounts and reported in the financial statements. Basis of accounting relates to the timing of the measurements made, regardless of the measurement focus applied. Governmental Funds and Expendable Trust Funds are accounted for using the modified accrual basis of accounting. Their revenues are recognized when they become susceptible to accrual, i.e., both measurable and available. Substantially all revenues are accrued. Expenditures are generally recognized under the modified accrual basis of accounting when the related fund liability is incurred, except for principal and interest on general long-term debt which is recognized when due. Agency Fund assets and liabilities are accounted for on the modified accrual basis of accounting. Proprietary funds are accounted for using the accrual basis of accounting. Revenues are recognized when they are earned, and expenses are recognized when they are incurred. E. Budgets and Budgetary Accounting 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. 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. 35 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31, 1994 -' 1. Summary of Significant Accounting Policies (Continued) E. Budgets and Budgetary Accounting (Continued) 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. There were no supplemental appropriations required or made during the year. 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, Special Revenue Funds and Capital Improvement Capital Projects 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. (See Note 16 for further information on budgeted and unbudgeted capital project funds.) 8. Budgets for the General, Special Revenue and Capital Improvement Capital Projects — Funds are adopted on a basis consistent with generally accepted accounting principles. 9. 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. ., 10. 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. Assets, Liabilities and Fund Equity 1) Cash and Cash Equivalents, 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. Earnings from such investments are allocated to the respective funds on the basis of applicable cash balance participation by each fund. With exception of the Deferred Compensation Agency Fund which states investments in a deferred — compensation plan at market, all investments are stated at cost which approximates market. Investments with original maturities of three months or less are classified as cash equivalents. -- 36 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31, 1994 1. Summary of Significant Accounting Policies (Continued) F. Assets, Liabilities and Fund Equity (Continued) 1) Cash and Cash Equivalents, and Investments (Continued) The City provides temporary advances to funds that have insufficient cash balances by means of an advance from the internal service and enterprise funds. This is classified as an interfund payable in the fund receiving the advance and as an offsetting interfund receivable in the internal service and enterprise funds. In accordance with authorized investment laws, the City invests in various mortgage- "" backed securities, such as collateralized mortgage obligations. These securities are reported at cost in the balance sheet. They are reported in aggregate as U.S. Government Agencies in the disclosure of custodial credit risk. (See Note 2 on investments). 2) Receivables Property Taxes The property tax levy was set by the City Council in November and was certified to the County for collection the following year. In Minnesota, counties act as collection agents for all property taxes. The County spreads the levies over all taxable property in the City. Such taxes become receivables of the City as of January 1. Property taxes are payable in equal installments by property owners to the County as follows: Personal property - February 28 and June 30 Real property - May 15 and October 15 The County remits the collections to the City and other taxing districts four times a year, in January, April, July and December. During 1994 taxes were adjusted downward $229,213 by Anoka County due to abatements and court ordered settlements. Unpaid taxes at December 31 become liens on the respective property and are classified in the financial statements as delinquent taxes receivable. The receivable is fully offset by deferred revenue as it is not available to finance current expenditures. Taxes payable on homestead property (as defined by State Statutes) are partially reduced by Homestead and Agriculture Credit Aid. This aid is paid to the City by the State in lieu of taxes levied against homestead property. The State remits this aid in two equal installments in July and December each year. Special Assessments Receivable -. 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 37 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31, 1994 — 1. Summary of Significant Accounting Policies (Continued) — F. Assets, Liabilities and Fund Equity (Continued) 2) Receivables (Continued) - Special Assessments Receivable (Continued) — 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 (including interest) is handled by the County in the — same manner as property taxes. Property owners are allowed to prepay total future installments without interest or prepayment penalties. Special assessments receivable includes the following components: Unremitted - amounts collected by Anoka County and not remitted to the City — prior to year end. Delinquent - amounts billed to property owners but not paid. IMOM Deferred - assessment installments which will be billed to property owners in future years. 3) Inventories Inventory in the General Fund consists of expendable supplies held for consumption and is recorded at cost on a first in first out basis. The cost is recorded as an expenditure at the time individual inventory items are used. Reported inventories are equally offset by a fund balance reserve which indicates that they do not constitute "available spendable resources' even though they are a component of net current — assets. Proprietary Funds inventory items are expensed at the time they are sold or used. MEM (Consumption method). Liquor inventories are recorded on the average cost basis. 4) Property and Equipment/General Fixed Assets — All fixed assets are recorded at historical cost or estimated historical cost, if the original cost was not available. Donated fixed assets are carried at the fair market value on the date donated. — Additions to general fixed assets for general City purposes, including public domain (infrastructure) fixed assets are recorded as expenditures of the applicable fund in the year in which the fixed asset was purchased or constructed, and are capitalized in the General Fixed Asset Account Group. Depreciation is not recorded on these assets. Property and equipment of the proprietary funds are capitalized in these funds. Depreciation of exhaustible property and equipment of the proprietary funds is charged as an expense against their operations and accumulated depreciation is reported on 38 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31, 1994 1. Summary of Significant Accounting Policies (Continued) —' F. Assets, Liabilities and Fund Equity (Continued) 4) Property and Equipment/General Fixed Assets (Continued) proprietary fund balance sheets. Depreciation has been provided over the estimated useful lives using the straight line method. The estimated useful lives are as follows: Improvements Other Than Building 20 - 50 years Buildings 20 - 50 years Machinery and Equipment 5 - 10 years Land N/A 5) Other Assets This account represents the market value of investments and other assets held in an agency fund for the City's deferred compensation plan. (See Note 17.) 6) 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. 7) Encumbrances Encumbrances represent purchase commitments. Encumbrances outstanding at year end are reported as reservations of fund balance since they do not constitute expenditures or liabilities. G. Revenues, Expenditures and Expenses The following transactions are accounted for as described below: General Property Taxes/Special Assessments - Revenue is recognized in the year of collection, with amounts due from the County and received early in the following year set up as receivable(unremitted receivables). Uncollected (delinquent)taxes and special assessments receivable are fully offset by deferred revenue until they become available to finance current expenditures. General property taxes and special assessments are recognized when cash is received to prevent overstating due to delinquencies. Principal Portion of Special Assessments - Revenue is recognized in the year the assessments are collected. 39 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31, 1994 — 1. Summary of Significant Accounting Policies (Continued) — G. Revenues, Expenditures and Expenses (Continued) Interest Revenue on Special Assessments Receivable- Interest revenue is recognized in the — year of collection of the current principal installment. Intergovernmental Revenues - Intergovernmental revenues in the form of state aids are — recorded as revenue when allocations are made by statutory formula Other intergovernmental revenues received as reimbursements for specific purposes or projects are recognized based upon the expenditures incurred. Intergovernmental revenues received through abatements or shares are recorded in the year determined to be measurable and available. Interest on Investments - Interest is recorded as revenue in the year earned. Water and Sewer Service Charges - Revenue is recognized when earned with no allowance for uncollectibles as delinquent accounts are certified as a special assessment lien against the property billed. Unbilled service charges are included in receivables at year-end. - Other Revenues - Licenses, fines, penalties and miscellaneous revenues are recorded as revenues when received in cash because they are generally not measurable until actually received. — Interest Expense on Bonded Indebtedness - Interest expense is recorded as an expenditure when paid in the governmental fund types and accrued when incurred in the proprietary fund — types. Bond and Interest Payments Due January 1 -Expenditures are recognized when amounts are remitted to the paying agent (usually in December) for payment of bonds and interest. H. Comparative Data Comparative total data for the prior year have been presented in the accompanying combined financial statements in order to provide an understanding of changes in the City's financial position and operations. However, comparative (i.e., presentation of prior year totals by fund — type) data have not been presented in all statements since their inclusion would make the statements unduly complex and difficult to read. Total columns on the combined statements are captioned 'Memorandum Only to indicate that — they are presented only to facilitate financial analysis. Data in these columns do not present financial position, results of operations, or cash flows in conformity with generally accepted accounting principles. Interfund eliminations have not been made in the aggregation of this — data Cash Flows Statements The Governmental Accounting Standards Board Statement No. 9 requires that governments include a statement of cash flows for proprietary and nonexpendable trust funds to replace the statement of changes in financial position as a basic financial statement. GASB statement No. 9 was effective for fiscal periods beginning after December 15, 1989 and accordingly its requirements have been incorporated in the accompanying financial statements. 40 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31, 1994 2. Deposits and Investments '— A. Deposits In accordance with applicable Minnesota Statues, the City maintains deposits at depository banks authorized by the City Council. All such depositories are members of the Federal Reserve System. Minnesota Statutes require that all deposits be protected by insurance, surety bond or collateral. If collateral is pledged as protection for the deposits, State Statues require that it be held by a third party in the City's name. The market value of the collateral must at a minimum be 110% of the deposits not covered by insurance or bonds (140% in the case of mortgage backed collateral). Repurchase agreements are intentionally overcollateralized at 105% to insure that the safety of investment principal is attained and losses do not occur from rapid overnight deterioration. Due to wire transfers and tax settlements credited by the bank at the end of the day, there were several occasions during the year where overnight deposits were undercollateralized. On each occasion, the uncollateralized balance was invested with another financial institution on the following day. — Balances at December 31, 1994 are as follows: Bank Carrying Balances Amount 1) Insured or collateralized by securities held by the City or its agent in the City's name $482,336 ($115,841) — 2) Collateralized with securities held by the pledging institution trust department in the City's name 0 0 3) Uncollateralized or collateralized with securities not in the City's name 0 0 — Totals $482,336 ($115,841) — Categories 2 and 3 are not procedures that are authorized by Minnesota statutes. ... B. Investments The City is authorized by Minnesota Statutes to invest in the following: (a) Direct obligations or obligations guaranteed by the United States or its agencies. (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. (c) General obligations of the State of Minnesota or any of its municipalities. (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. 41 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31, 1994 — 2. Deposits and Investments (Continued) — B. Investments (Continued) (f) Repurchase or reserve 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, or certain — Minnesota securities broker dealers. (g) Future contracts sold under authority of Minnesota Statutes 471.56, subd.5. — The City invests in collateralized mortgage obligations (a form of mortgage back security). These securities allow cash flows to be split so that different classes of securities with different maturities and coupons may be created. The City by policy is only allowed to invest in these types of securities if they — are classified as a Planned Amortization Class 1 (PAC 1) with a stated maturity of 3 years or less. The City's investments are categorized below to give an indication of the level of risk assumed at year — end. The level of risk is defined by the following criteria set out by the Governmental Accounting Standards Board within Statement No. 3. Category 1 includes investments that are insured or registered for which the securities are held by the City or its agent in the City's name. Category 2 includes uninsured and unregistered investments for which the securities are held by the counterparty's — trust department or agent in the City's name. Category 3 includes uninsured and unregistered investments for which the securities are held by the counterparty, or by its trust department or agent but not in the City's name. — The carrying value, market value and credit risk of the investments held by the City at year end are as follows: ._ Credit Risk Category Carrying Market Securities Type 1 2 3 Amount Value — U.S. Government securities $6,488,814 $ $6,488,814 $5,703,993 U.S. Government agencies - — or instrumentalities 29,676,489 29,676,489 27,142,944 Commercial paper 992,483 992,483 989,408 Repurchase agreements 4,004,060 4,004,060 4,004,060 — $37,157,786 $4,004,060 Investment in money market fund 2,282,845 2,058,499 • Investment in deferred — compensation plans(at market) 4,701,218 4,701,218 Total investments $48,145,909 $44,600,122 42 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31, 1994 2. Deposits and Investments (Continued) Cash and Cash Equivalents and Investments per accompanying financial statement: Cash and cash equivalents $5,991,604 Investments 37,337,246 Total $43,328,850 3. Special Assessments Receivable Special assessments receivable at December 31, 1994 are as follows: Special Special Assessment Assessment Capital General Debt Service Projects Total _ Unremitted $ $3,193 $ $3,193 Delinquent 3,695 93,714 97,409 Deferred 1,182 2,197,528 48,763 2,247,473 Total $4,877 $2,294,435 $48,763 $2,348,075 43 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31, 1994 — 4. Due From Other Governments — Amounts due from other governments at December 31, 1994 are as follows: General Fund: State of Minnesota: a) State Aid Mainenance $19,170 — Anoka County: a) Fines and Forfeits 13,556 b) Gas Reimbursement 590 — c) Property Damage Reimbursement 100 d) Enforcement of State Seat Belt Law 1,050 e) Resitution 525 — City of Hilltop 10,522 School District#14 555 — Total General Fund $46,068 Special Revenue Funds: — Anoka County: a) Community Development Block Grant 158,981 — b) Recycling 28,585 Greater Minneapolis Council of Churches a) Title III 692 — Total Special Revenue Funds $188,258 Enterprise Funds: Utility Funds: — Metropolitan Waste Control Commission (MWCC)- Current portion of amounts due from MWCC $21,311 Non-current portion- long term receivable of amounts due from MWCC $439,249 44 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31. 1994 4. Due From Other Governments (Continued) The non-current receivable of $439,249 in the Utility Enterprise Fund is comprised of: 1. The balance due for the sale of the City's sewer interceptors is$120,032 (the interceptors were sold to the Metropolitan Waste Control Commission January 1, 1971). This receivable will be paid to the City in annual installments with interest through 1999. Repayment will be made by issuing credits against future disposal charges from the Commission. 2. The amount of $1,817, which will be repaid with interest through 1998, is for advances made to the Commission during 1971 and 1972. — 3. The credits for excess sewer availability charges of$317,400 arising from the change in use of various properties within the City. These credits will be offset against current availability charges as they occur. 5. Changes in General Fixed Assets A summary of changes in general fixed assets are as follows: Balance Balance Jan 1, 1994 Additions Deletions Dec 31, 1994 Land $2,269,670 $215,243 $ $2,484,913 Buildings 4,773,786 108,255 4,882,041 Improvements other than buildings 18,322,067 888,679 3,268,118 15,942,628 Machinery and equipment 5,322,556 400,403 811,661 4,911,298 Construction in progress 1,307,914 1,307,914 Total $31,995,993 $1,612,580 $5,387,693 $28,220,880 45 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31, 1994 — 6. Summary of Proprietary Fund Property and Equipment — A summary of proprietary fund type property, plant and equipment at December 31, 1994 follows: Internal Service Enterprise Funds Funds — Public Information Liquor Utilities Systems Total — Land $66,961 $154,531 $ $221,492 Buildings 178,897 1,529,236 $1,708,133 — Improvements other than buildings 86,759 6,370,544 $6,457,303 Machinery and equipment 247,272 2,281,441 819,572 $3,348,285 — Water and sewer lines 17,987,786 $17,987,786 579,889 28,323,538 819,572 $29,722,999 Less: — Accumulated depreciation (307,426) (8,680,232) (561,735) ($9,549,393) Net property and equipment $272,463 $19,643,306 $257,837 $20,173,606 — 7. Lona-Term Debt — The following is a summary of long-term debt transactions of the City for the year ended December 31, 1994: General Obligation Bonds Special Tax Construction — Assessment Increment Revenue Loan Total Debt payable at January 1, 1994 $3,575,000 $15,770,000 $2,155,000 $131,542 $21,631,542 — Debt issued 150,000 335,000 $485,000 Debt retired (2,000,000) (305,000) (80,000) (3,685) (2,388,685) — Debt payable at December 31, 1994 $1,725,000 $15,465,000 $2,410,000 $127,857 $19,727,857 46 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31, 1994 7. Long-Term Debt (Continued) Bonds payable at December 31, 1994 are comprised of the following individual issues (in thousands of dollars): General Long-Term Debt: $4,070,000 Tax Increment Revenue Refunding Bonds of 1985 due in varying annual installments of $265,000 - $460,000 through February 1, 1999; interest at 6.75% - 9.00% $ 1,950 $9,485,000 General Obligation Tax Increment Refunding Bonds of 1990 due in varying annual installments of $810,000 - $1,270,000 through August 1, 2009; interest at 6.60% - 7.00% 9,485 $1.020,000 Special Assessment Bonds of 1991 due in varying annual installments of$35,000-$90,000 through February 1, 2005; interest at 5.6% - 6.6% 770 $855,000 General Obligation Special Assessment Bonds of 1992, Series A, due in varying annual installments of $50,000 to $95,000 through February 1, 2004; interest at 3.00% - 5.25% 805 $4,030,000 General Obligation Temporary Tax Increment Bonds of 1992, Series C, due on December 1, 1995; interest at 3.85% 4,030 $150,000 Special Assessment Bonds of 1994 due in varying annual installments of $5,000-$60,000 through February 1, 2005; interest at 4.75% to 6.10% 150 Subtotal General Long-Term Debt 17,190 Revenue Bonds: $1,615,000 General Obligation Water Revenue Bonds of 1991 due in varying —. annual installments $35,000 - $140,000 through February 1, 2011; interest at 5.% - 6.8% 1,490 _ $620,000 General Obligation Water Revenue Bonds of 1992, Series B, due in varying annual installments of $35,000 to $55,000 through February 1, 2007; interest at 3.0% to 5.7% 585 -- $150,000 General Obligation Water, Sewer and Storm Water Revenue Bonds of 1994 due in varying annual installments of $5,000-$25,000 through February 1, 2005; interest at 4.75% to 6.10% 335 Subtotal Revenue Bonds 2.410 Total Bonds Payable 1.19,600 47 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31, 1994 7. Lonq-Term Debt (Continued) Non-bonded indebtedness at December 31, 1994 is comprised of the following: Construction Loan: ._ 135,000 Locke Lake Dam Reconstruction loan from the State Department of Natural Resources due in annual installments of $12,301 through April 1, 2012; interest at 6.55% $128 — The Tax Increment Revenue Refunding Bonds are payable solely from increment revenue that is generated from the related increment district. General Obligation Tax Increment Refunding Bonds are — payable primarily from tax increment revenue with any deficiency to be provided by general property taxes. General Obligation Special Assessment Bonds are payable from assessments levied against benefitted properties. While it is anticipated that the assessment will be adequate to make the required debt payments, the City is responsible for any deficiency that may occur. The General Obligation Revenue Bonds are payable from the net revenues of the City's water, sewer and storm water systems in addition to the general obligation pledge. Annual Requirements to Amortize Long Term Debt December 31, 1994 — General Obligation Bonds — Year Ending Special Construction December 31 Assessment Redevelopment Revenue Loan Total 1995 254,157 5,318,895 221,140 12,301 $5,806,493 1996 254,067 1,130,300 252,567 12,301 $1,649,235 1997 260,220 1,128,835 251,645 12,301 $1,653,001 — 1998 245,719 1,128,905 250,245 12,301 $1,637,170 1999 236,067 1,129,830 248,362 12,301 $1,626,560 2000-2004 837,410 6,483,990 1,272,334 61,505 $8,655,239 — 2005-2009 103,150 7,185,510 959,696 61,505 $8,309,861 2010-2012 288,700 36,899 $325,599 $2,190,790 $23,506,265 $3,744,689 $221,414 $29,663,158 — $10,524,906 is available in the Debt Service Fund to service the Special Assessment and Redevelopment Bonds. $10,390,561 is available in the Public Utility Enterprise Funds, to service the Water, Sewer and Storm Water Revenue Bonds. In 1990,the City advance refunded the$10,045,000 General Obligation Tax Increment Refunding Bonds of 1986 (1986 Bonds) by issuing the $9,485,000 General Obligation Tax Increment Refunding Bonds — of 1990 (1990 Bonds). The proceeds of the 1990 Bonds were used by the City's escrow agent to 48 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31, 1994 7. Long-Term Debt (Continued) acquire United States Treasury Securities-State and Local Government Series (SLGS) in amounts and maturities to match the debt payments on the 1986 Bonds until those bonds were called on February 1, 1994. There are a number of limitations and restrictions contained in the various bond indentures. The City is in compliance with all significant limitations and restrictions. Legal Debt Margin - Under applicable State Statutes, the legal debt margin is 2% of the most recent market value less certain deductions. At December 31, 1994, the legal debt margin was $21,835,658. 8. 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 pension 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 public employee retirement systems. ... PERF members belong to either the Coordinated Plan or the Basic Plan. Coordinated members are covered by Social Security and Basic 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. The payroll for employees covered by PERF and PEPFF for the year ended December 31, 1994, was $3,394,504 and $1,502,283, respectively; the City's total payroll was $6,087,598. 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 member's average salary for any five successive years of allowable service, age, and years of credit at termination of service. Two methods are used to compute benefits for Coordinated and Basic members. The retiring member receives the higher of step-rate benefit accrual formula (Method 1) or a level accrual formula (Method 2). Under Method 1, the annuity accrual rates for a Basic — member is 2 percent of average salary for each of the first 10 years of service and 2.5 percent for each remaining year. For a Coordinated member, the annuity accrual is 1 percent of average salary for each of the first 10 years and 1.5 percent of each remaining year. Using .... Method 2, the annuity accrual rate is 2.5 percent of average salary for Basic members and 1.5 percent for Coordinated members. For PEPFF members, the annuity accrual rate is 2.65 percent of average salary for each year of service. For PERF members whose annuity is calculated using Method 1, and for all PEPFF members, a full annuity is available when age plus years of service equal 90. There are different types of annuities available to members upon retirement. A normal annuity is a lifetime annuity that ceases upon the death of the retiree. No survivor annuity is payable. There are also various types of joint and survivor annuity options available which will reduce the monthly normal annuity amount, because the annuity is payable over joint lives. Members may also leave their contributions in the fund upon termination of public service, in order to qualify for a deferred annuity at retirement age. Refunds of contributions are available at any time to members who leave public service, but before retirement benefits begin. 49 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31, 1994, 8. Defined Benefit Pension Plans-Statewide (Continued) — B. Contributions Required and Contributions Made Minnesota Statutes Chapter 353 sets the rates for employer and employee contributions. The — City makes annual contributions to the pension plans equal to the amount required by State statutes. According to Minnesota Statutes Chapter 356.215, Subdivision 4 (g), the date of full funding required for the PERF and the PEPFF is the year 2020. As part of the annual actuarial — valuation, PERA's actuary determines the sufficiency of the statutory contribution rates towards meeting the required full funding deadline. The actuary compares the actual contribution rate to a 'required' contribution rate. Current combined statutory contribution rates and actuarially required contribution rates for the plans are as follows: Statutory Rates: Required — Employees Employer Rates PERF: -- Basic& Coordinated plans 4.30% 4.60% 9.58% PEPFF 7.90% 11.70% 17.45% — Total contributions made by the City during fiscal year 1994 were: — Percentage of Amounts Covered Payroll — Employees Employer Employees Employer PERF: Basic plan $11,716 $15,275 8.23% 10.73% — Coordinated plan 137,566 145,696 4.23% 4.48% PEPFF 114,825 172,237 7.64% 11.46% Total $264,107 $333,208 — The City's contribution for the year ended June 30, 1994, to the PERF represented .13 percent of total contributions required of all participating entities. For the PEPFF, contributions for the — year ended June 30, 1994, represented .52 percent of total contributions required of all participating entities. C. Funding Status and Progress 1. Pension Benefit Obligation — The 'pension benefit obligation' is a standardized disclosure measure of the present value of pension benefits, adjusted for the effects of projected salary increases and step- rate benefits, estimated to be payable in the future as a result of employee service to date. The measure, which is the actuarial present value of credited projected benefits, is intended to (a) help users assess PERA's funding status on a going-concern basis, (b) assess progress made in accumulating sufficient assets to pay benefits when due, — and (c) make comparisons among Public Employees Retirement Systems and among employers. PERA does not make separate measurements of assets and pension benefit obligation for individual employers. 50 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31. 1994 8. Defined Benefit Pension Plans-Statewide (Continued) -" C. Funding Status and Progress (Continued) 1. Pension Benefit Obligation (Continued) The pension benefit obligations of PERA as of June 30, 1994, were as follows: Public Public Employees Employees Retirement Police& Fund Fire (PERF)(in thousands)(PEPFF) Total pension benefit obligations $5,625,598 $1,020,950 Net assets available for benefits, at cost(Market values in thousands) PERF=$4,762,519 PEPFF=$1,237,484 4,733,845 1,229,769 Unfunded(assets in excess of) pension benefit obligation $891,753 ($208,819) The measurement of the pension benefit obligation is based on an actuarial valuation as of June 30, 1994. Net assets available to pay pension benefits were valued as of June 30, 1994. For the PERF, significant actuarial assumptions used in the calculation of the pension benefit obligation include (a) a rate of return on the investment of present and future assets of 8.5 percent per year, compounded annually, prior to retirement, and 5 percent per year, compounded annually, following retirement; (b) projected salary increases taken from a select and ultimate table; (c) payroll growth at 6 percent per year, consisting of 5 percent for inflation and 1 percent due to growth in group size; (d) post- - retirement benefit increases that are accounted for by the 5 percent rate of return assumption following retirement; and (e) mortality rates based on the 1983 Group Annuity Mortality Table set forward one year for retired members and set back five years for each active member. Actuarial assumption used in the calculation of the PEPFF include (a) a rate of return on the investment of present and future assets.of 8.5 percent per year, compounded annually, prior to retirement, and 5 percent per year, compounded annually following retirement; (b) projected salary increases of 6.5 percent per year, compounded annually, attributable to the effects of inflation; (c)post-retirement increases that are accounted for the 5 percent rate of return assumption following retirement; and (d) mortality rates based on the 1971 Group Annuity Mortality Table projected to 1984 for males and females. 51 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31, 1994 —' 8. Defined Benefit Pension Plans-Statewide (Continued) _ C. Funding Status and Progress (Continued) 2. Changes in Benefit Provisions The 1994 legislative session did not include any benefit improvements which would impact funding costs for the PERF and the PEPFF. 3. Changes in Actuarial Assumptions Prior to fiscal year 1994, the salary increase assumption and the mortality tables used in the calculation of pension benefit obligation for the PERF were the same as those specified for the PEPFF. For July 1, 1994 actuarial valuation, PERA's board of trustees approved new mortality rates updated to the 1983 Group Annuity Mortality Table, salary — increases which were changed to a select and ultimate table and a new payroll growth assumption which was changed from 6.5 percent to 6 percent. These changes were made to reflect actual experience of the plan. — With the adoption of the actuarial assumption changes and the new mortality tables for the PERF, the pension benefit obligation increased $56,596,000. The actuarial assumption changes also necessitated a $81,201,000 transfer from the PERF Benefit Reserve to the PERF Minnesota Post Retirement Investment Fund (MPRIF) Reserve to finance the increased obligation for future retirement benefits. The change in the mortality rate assumption increased the PERF's costs because pensioners are living — longer the assumed previously. The change in the salary increase assumption,however, offset some of the additional costs because lower salary increases generally translate into lower benefit liabilities in the future. Potential changes in the assumptions used for the PEPFF may be made in the future after completion of a special experience study for that fund. Completion of the PEPFF experience study is expected by February 1, 1995. D. Ten-Year Historical Trend Information Ten-year historical trend information is presented in PERA's Comprehensive Annual Financial Report for the year ended June 30, 1994. This information is useful in assessing the pension plan's accumulation of sufficient assets to pay pension benefits as they become due. E. Related Party Investments As of June 30, 1994, and for the fiscal year then ended, PERA held no securities issued by the City or other related parties. F. Federal Insurance Contribution Act (Social Security) Approximately sixty (60%) percent of the permanent City employees are covered by Social Security. The 1994 contribution rate was 7.65% (6.2% is social security and 1.45% is medicare) —. up to a maximum in wages of $60,600 for Social Security with no maximum in wages for Medicare. The cost of Social Security for 1994 was $238,459. In addition, as of April 1, 1986 all newly hired or returning seasonal employees who are not covered by PERA and thus — contributing to Social Security, must contribute 1.45% of their salary to Medicare with an equal match made by the City. The 1994 cost for Medicare was $67,315. 52 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31, 1994 9. Defined Contribution Pension Plan - Fridley Volunteer Firefighter Relief Association A. 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. The City's annual payroll was$6,087,598. There are no payroll earnings for _ volunteer firefighters subject to pension contributions; however, in accordance with the Associations bylaws, each active and deferred member contributes $150 per year to the Association. The City also remitted $72,741 and $69,120 in State Aid to the Association for 1994 and 1993 respectively. Currently the City does not levy any taxes on behalf of the Association. In the event that the state aid formulas would change, the City would pick up the shortfall. The contribution benefits for each member (and earnings allocated to each members account) are vested as follows: Years of Service Percent Vested 0 thru 9 years 0% 10 years 60% 11 years 64% 12 years 68% 13 years 72% 14 years 76% 15 years 80% 16 years 84% 17 years 88% 18 years 92% 19 years 96% 20 years and over 100% —. Normal Retirement Eligibility 50 years of age and 20 years of service. Deferred Vested Eligibility On termination after completion of 10 years of service, a deferred benefit is payable at age 50 equal to the accrued benefit times the vesting percentage. Lump Sum Death Benefit Payment of an amount not to exceed $1,000 as a funeral benefit to the surviving spouse, or if no surviving spouse, the estate of the deceased Association member. During 1994 and as of December 31, 1994 the Association held no securities issued by the City or other related parties. 53 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31, 1994 — 10. Defined Benefit Pension Plan - Fridley Police Relief Association ,_ A. Plan Description The City of Fridley Police Relief Association, a single-employer public employee retirement -- system consolidated with the Public Employees Retirement Association of Minnesota's (PERA) Police and Fire Consolidation Fund (PFCF), an agent multiple employer retirement plan, on November 30, 1993. Police officers of the City hired prior to December 15, 1975, were members — of the Association. Police officers hired after December 15, 1975 are members of the PERA Public Employees Police and Fire Fund. The City's payroll for employees covered by PFCF for the year ended December 31, 1994 was $404,822; the City's total payroll was $6,087,598. — PFCF members have the option to choose benefits identical to these of the Public Employees Police & Fire Fund identified in Note 8; otherwise, they are covered by the benefit provisions of the relief association at the time of consolidation, which were as follows: — Age and Service Retirement — Eligibility 50 years of age and 10 years of service Amount For first 10 years of service, 15/75 of base pay. For each year in excess of 10, an additional 2/75 is added. For each year in excess of 20, an additional 1/75 is added up to -- a maximum of 42/75 of base pay. Pay Used for Plan Purposes For benefit determination purposes, "base pay" means the — salary of a first grade patrolman for the second month of the previous fiscal year. For contribution purposes, it means the present base pay of a first grade patrolman. Disability Retirement — Eligibility Disabled to the extent that member is no longer able to perform the duties of a police officer before being eligible for age and service retirement. — Amount 36/75 of base pay. — Member's Death while Active, or in Deferred Status or Retired Eligibility Spouse Legally married to member at least one year prior to separation from service and — residing with member at time of death. Benefits terminate upon remarriage. Child Younger than age 18. — Amount Spouse 18/75 of base pay. -_ Child 6/75 of base pay per child. Children's maximum is 18/75 if spouse is receiving benefits; 36/75 if spouse is not receiving benefits. 54 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31, 1994 10. Defined Benefit Pension Plan - Fridley Police Relief Association (Continued) A. Plan Description (Continued) Vested Deferred 10 years of service and separated before age 50. Maximum benefit is 40/75 of base pay. Payment beginning is deferred to attainment of age 50. Post-Retirement Adjustment ("Escalator") Each time base pay was changed, payments to all benefit recipients were simultaneously changed by the same percent that base pay was changed. (Exception - For members on age and service retirement with less than 20 years service, the maximum increase was 3% compounded annually. Also, applies to survivors of these retirees). B. Funding Status and Progress The amount shown below as the 'pension benefit obligation' is a standardized disclosure measure of the present value of pension benefits, adjusted for the effects of projected salary increases, estimated to be payable in the future as a result of employee service to date. The measure is the actuarial present value of credited projected benefits and is intended to (a) help �-' users assess the plan's funding status on a going-concern basis. (b) assess progress being made in accumulating sufficient assets to pay benefits when due, and (c) allow for comparisons among public employees retirement plans. The measure is independent of the actuarial funding method used to determine contributions to the plan. The pension benefit obligation was determined as part of the most recent actuarial valuation _ of the plan which was dated June 30, 1994. Significant actuarial assumptions used in determining the pension benefit obligation include (a) a rate of return on the investment of present and future assets of 8.5%per year compounded annually, (b) projected salary increases of 6.5% percent per year, compounded annually, attributable to the effects of inflation; (c) post- - retirement increases that are accounted for the 5 percent rate of return assumption following retirement; and (d) mortality rates based on the 1971 Group Annuity Mortality Table projected to 1984 for males and females. 55 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31, 1994 10. Defined Benefit Pension Plan - Fridley Police Relief Association (Continued) — B. Funding Status and Progress (Continued) As of June 30, 1994, the actuarial valuation date, the unfunded pension benefit obligation was determined as follows: Pension Benefit Obligation: Retirees and beneficiaries currently receiving benefits and terminated employees not yet ,_ receiving benefits $424,962,253 Current employees-- Accumulated employee contributions including allocated investment income 46,999,428 Employer financed 232,175,496 — Total Pension Benefit Obligation $704,137,177 Net assets available for benefits, at cost 642,171,920 — Unfunded Pension Benefit Obligation $61,965,257 Net assets available/Pension benefit obligation 91.20% No changes in actuarial assumptions or benefit provisions that would significantly affect the — valuation of the pension benefit obligation occurred during 1994. C. Contributions Required and Contributions Made Minnesota Statutes Chapter 353 sets the rates for employer and employee contributions. The City makes annual contributions to the pension plans equal to the amount required by State statutes. According to Minnesota Statutes Chapter 356.215, Subdivision 4 (g), the date of full — funding required for the PFCF is the year 2020. As part of the annual actuarial valuation, PERA's actuary determines the sufficiency of the statutory contribution rates towards meeting the required full funding deadline. Contributions actuarially required are equal to contributions made due to the additional municipal contribution, if any, paid by the employer. Current combined statutory contribution rates and actuarially required contribution rates for the PFCF are 7.60% for the employee and 11.40% for the employer. Total contributions made by the City and its employees for the year ended June 30, 1994, were $43,225 and $30,839 respectively. The contributions represented 10.67% and 7.61% of covered payroll. The City contributions for the year ended June 30, 1994 represented 4% of — the total contributions required of all participating entities. D. Historical Trend Information Historical trend information related to the pension plan is presented in the Association's annual financial report. The information is presented to enable the reader to assess the progress made by the Association in accumulating sufficient assets to pay pension benefits as they become due. 56 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31, 1994 11. Interfund Receivables and Payables Interfund receivables and payables at December 31, 1994 are as follows: _. Interfund Interfund Receivables Payables Due From/Due To: General Fund $ $249,605 Special Revenue Funds Grant Management Fund 12,411 71,245 HRA Reimbursement Fund 266 227 HRA Housing Fund 12,550 Capital Projects Funds Special Assessment Fund 670,672 HRA Fund 127 Enterprise Funds Liquor Fund 235,460 Internal Service Funds Employee Benefits Fund 170,106 Self Insurance Fund 926,498 Agency Funds Hotel/Motel Tax Agency Fund 103 $1,174,635 $1,174,635 57 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31, 1994 12. Reserved Fund Balances/Retained Earnings — The following reservations have been made of various fund balances/retained earnings at December 31, 1994. ,^ General Fund Reserved for: Encumbrances $67,431 — Inventory 21,992 Prepaid items 97,779 Long-term receivables 144,262 -- 331,464 — Special Revenue Funds Reserved for: Encumbrances 3,186 — Long-term receivables 6,614 9,800 Debt Service Funds Reserved for Debt Service 1,544,123 Capital Projects Funds Reserved for: Encumbrances 865,353 — Construction 8,539,266 Long-term receivables 1,134,807 10,539,426 Total Governmental Funds $12,424,813 — Retained Earnings — Enterprise Funds Public Utilities Funds Reserved for capital outlay $2,259,000 Internal Service Funds Employee Benefits Fund Reserved for employee benefits 91,680 Information Systems Fund Reserved for equipment acquisition 69,219 160,899 Total Proprietary Funds $2,419,899 58 — CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31, 1994 13. Designated Fund Balance The following designations have been made of various fund balances at December 31, 1994: _ General Fund: Working Capital $3,742,506 Subsequent Year's Expenditures 1,016,720 Contingencies 820,753 — Replacement of Fixed Assets 994,935 Total General Fund 6,574,914 Special Revenue Funds: Cable TV Fund- Subsequent Year's Expenditures 29,832 — Cable TV Program 117,185 Grant Management Fund- Subsequent Year's Expenditures 6,943 — Solid Waste Abatement Fund Subsequent Year's Expenditures 11,988 Solid Waste Abatement 37,048 — Drug and Gambling Forfeiture Fund Drug and Gambling Enforcement 10,383 ,_ Total Special Revenue Funds 213,379 Capital Projects Funds: Capital Improvement Fund- Replacement of Fixed Assets 1,728,644 Park Improvement 707,381 Street Improvements 5,121,870 — Total Capital Project Fund 7,557,895 Total of Designated Fund Balances 14,346,188 59 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31, 1994 — 14. Contributed Capital A reconciliation of contributed capital is as follows: Public Utility Self Insurance Information Systems Enterprise Fund Internal Service Fund Internal Service Fund — Balance January 1 $12,474,387 $1,000,000 $ — Increases Current capital contributions 477,347 1,068,724 Decreases — Depreciation of contributed assets (359,937) ($59,981) Balance December 31 $12,591,797 $1,000,000 $1,008,743 The current capital contributions in the Information Systems Internal Service Fund include a cash contribution from the Special Assessment Debt Service Fund. This contribution, totaling $812,285, is shown as a residual equity transfer in the Special Assessment Debt Service Fund; whereas, the — Information Systems Internal Service Fund recorded the contribution as an increase to contributed capital. 60 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31, 1994 15. Segment Information for Enterprise Funds The City maintains operating funds for Liquor and Utility (Water, Sewer, Storm Sewer Operations). Segment information for the year ended December 31, 1994 is as follows: Total Enterprise Liquor Utility Funds Sales(less cost of sales of$2,486,129) $597,837 $ $597,837 Operating revenues 3,985,612 3,985,612 Operating expenses (499,826) (4,534,059) (5,033,885) Operating income(loss) 98,011 (548,447) (450,436) Non-operating revenues (expenses)- net 58,729 112,493 171,222 -� Operating transfers in (out) (25,000) (25,000) Net income(loss) $131,740 ($435,954) ($304,214) Depreciation expense included in operating expenses $26,326 $627,250 $653,576 Property and equipment- Additions(including capital contributions) 3,595 1,574,920 1,578,515 Working capital 1,266,632 5,224,893 6,491,525 Total assets 1,752,014 25,876,960 27,628,974 Fund equity- Contributed capital 12,591,797 12,591,797 Retained earnings 1,539,095 10,390,651 11,929,746 Total fund equity $1,539,095 $22,982,448 $24,521,543 Current capital contributions $477,347 $477,347 Bonds payable $2,410,000 $2,410,000 61 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31, 1994 -' 16. Unbudgeted Capital Project Funds The City does not budget all Capital Project Funds, and accordingly, the applicable columns of the — Combined Statement of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual (Exhibit A-3) excludes amounts relating to unbudgeted funds. A reconciliation of actual results for budgeted and unbudgeted funds is as follows: — Other Financing Fund Balance Sources December 31, — Revenues Expenditures (Uses) 1994 All Capital Project Funds $4,301,787 $3,221,776 ($1,574,621) $17,523,282 — Less unbudgeted funds: Special Assessment Fund 29,982 992,897 1,050,675 (574,039) — HRA Fund 3,371,084 1,275,888 (1,730,001) 9,674,073 Budgeted Capital Project Funds $900,721 $952,991 ($895,295) $8,423,248 17. Deferred Compensation Plan The City and Housing and Redevelopment Authority (HRA) both offer their employees a deferred compensation plan established in accordance with Internal Revenue Code Section 457. The plan, available to all employees, permits them to defer a portion of their salary until future years. The deferred compensation is not available to employees until termination, retirement, death, or unforeseeable emergency. All amounts of compensation deferred under the plans, all property and rights purchased with those amounts, and all income attributable to those amounts, property, or rights are (until paid or made available to the employees or other beneficiary) solely the property and rights of the City and HRA, subject only to the claims of the City's and HRA's general creditors. Participants' rights under the plan are equal to those of general creditors of the City and HRA in an amount equal to the fair market value of the deferred account for each participant. It is the opinion of legal counsel that the City and HRA have no liability for losses under the plan but — does have the duty of due care that would be required of an ordinary prudent investor. The City believes that it is unlikely that it will use the assets to satisfy the claims of general creditors in the future. — Plan assets, stated at market on December 31, 1994, are $4,695,082 and $6,136 for the City and HRA respectively; and are shown in the financial statements as 'Other assets' in the agency funds with a — corresponding credit to 'Deposits payable'. 18. Litigation — The City had the usual and customary type of miscellaneous claims pending at year-end, mostly of a minor nature and usually all covered by insurance carried for that purpose. At the present time, there is no significant litigation pending not covered by the City's insurance. 62 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31, 1994 19. Leases Operating Lease The City leases the property at 214 Mississippi from the Fridley Housing and Redevelopment Authority for a warehouse liquor store. The City and Housing and Redevelopment Authority have a lease with one year options. Rental expense is $21,250 annually. Capital Lease The City has entered into a lease agreement as lessee for financing the acquisition of a sidewalk snowplow. This lease agreement qualifies as a capital lease, and therefore, the sidewalk plow has been recorded as machinery and equipment in the General Fixed Asset Account Group at the present value of future minimum lease payments. ... The future minimum lease obligation and net present value of these minimum lease payments as of December 31, 1994 are as follows: _ 1995 $14,572 1996 14,572 Total lease payments $29,144 Less amount representing interest (2,663) $26,481 20. Deficit Balances The following fund had a deficit balance at December 31, 1994: — Capital Project Funds: Special Assessments ($574,039) This deficit balance will be funded by a combination of future General Obligation Improvement Bonds and transfers from other funds. — 63 CITY OF FRIDLEY, MINNESOTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31, 1994 21. Tax Increment Districts — The Fridley Housing and Redevelopment Authority is the administrating authority for the following Tax Increment Financing Districts: — Retained Year Tax Capacity Values Fiscal By Established District Original Current Captured Disparity Authority 1979 1 $249,506 $862,596 $613,090 $ $613,090 1981 2 71,034 789,548 718,514 718,514 1982 3 244,444 1,607,093 1,362,649 (299,180) 1,063,469 1985 6 1986 7 10,960 84,135 73,175 73,175 1986 8 27,015 35,287 8,272 8,272 1989 9 950,093 867,149 1990 10 1991 11 61,952 73,910 11,958 16,050 28,008 1992 12 106,711 183,670 76,959 76,959 — $1,721,715 $4,503,388 $2,864,617 ($283,130) $2,581,487 — All debt issued is pooled debt. Total bonds issued are$42,605,000. Total amount of bonds redeemed ._ are $27,140,000. Outstanding bonds at December 31, 1994, are $15,465,000. All taxable value is currently retained by the Housing and Redevelopment Authority. 22. Contingent Liability In 1993, the Housing and Redevelopment Authority (HRA) entered into a limited tax increment revenue note with a developer whereby the HRA shall pay the developer the lesser of the scheduled payment — or available tax increment. Whether a payment will occur and if so, the amount of the payment 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. — At December 31, 1994, the maximum possible payment to the developer wa $1,565,261. 64 GENERAL FUND The General Fund was established to account for the revenues and expenditures necessary to carry out basic governmental activities of the City, such as general government, public safety, and public works. Revenues are recognized by source, such as property taxes, licenses and permits, fines and forfeits, charges for services and state-shared taxes. General Fund expenditures are made primarily for current day to day operations and are recorded by functional classifications and by operating departments. This fund accounts for all financial transactions not accounted for in another fund. • Exhibit B-1 CITY OF FRIDLEY, MINNESOTA GENERAL FUND COMPARATIVE BALANCE SHEET December 31, 1994 and 1993 1994 1993 Assets Cash and cash equivalents $994 $330 Investments 6,969,899 7,176,852 Receivables: Accounts 30,220 14,691 Taxes- Unremitted 17,220 48,504 Delinquent 28,795 209,853 Special Assessments- Unremitted Delinquent 3,695 3,806 Deferred 1,182 2,937 Interest 331,603 261,531 Loans 6,300 6,300 Developer note 137,962 137,730 Due from other governments 46,068 55,430 Due from other funds 14,230 Inventories, at cost 21,992 25,975 Prepaid items 97,779 59,829 -- Total assets $7,693,709 $8,017,998 Liabilities and Fund Balance Liabilities: Accounts payable $138,418 $128,638 Deposits payable 3,478 1,217 Contracts payable 47,958 Salaries payable 126,128 136,656 Deferred revenue 35,528 216,596 Due to other governments 5,858 179,271 Due to other funds 249,605 403,260 Total liabilities 559,015 1,113,596 Fund balance: Reserved for encumbrances 67,431 67,671 Reserved for inventory 21,992 25,975 Reserved for prepaid items 97,779 59,829 Reserved for long-term receivables 144,262 144,030 Unreserved- Designated for working capital 3,742,506 3,109,597 Designated for contingencies 820,753 936,472 Designated for subsequent year's expenditures 1,016,720 239,655 Designated for fixed asset replacement 994,935 534,726 Undesignated 228,316 1,786,447 Total fund balance 7,134,694 6,904,402 Total liabilities and fund balance $7,693,709 $8,017,998 65 Exhibit B-2 CITY OF FRIDLEY, MINNESOTA GENERAL FUND STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE- BUDGET AND ACTUAL Year Ended December 31, 1994 With Comparative Actual Amounts for Year Ended December 31, 1993 1994 Variance Favorable 1993 Budget Actual (Unfavorable) Actual Revenues: Taxes $3,556,148 $3,529,356 ($26,792) $3,667,991 Special assessments 1,896 3,975 2,079 2,896 Licenses and permits 420,626 439,237 18,611 322,201 Intergovernmental revenue 3,054,262 3,109,846 55,584 3,033,365 Charges for services 849,445 892,471 43,026 787,742 Fines and forfeits 242,392 184,024 (58,368) 198,190 Interest on investments 430,000 402,563 (27,437) 541,163 Miscellaneous 155,232 185,196 29,964 130,561 Total revenues 8,710,001 8,746,668 36,667 8,684,109 Expenditures: Current- General government 1,772,365 1,630,467 141,898 1,548,100 Public safety 3,661,846 3,549,978 111,868 3,405,367 Civic center 187,774 180,104 7,670 169,493 Public works 2,196,164 2,144,797 51,367 2,147,000 Community development 481,579 462,615 18,964 407,470 Recreation and naturalist 816,124 780,242 35,882 720,759 Reserve for contingency 41,919 41,919 Capital outlay 282,303 274,929 7,374 305,531 - Debt service 18,830 14,572 4,258 Total expenditures 9,458,904 9,037,704 421,200 8,703,720 Excess(deficiency)of revenues over expenditures (748,903) (291,036) 457,867 (19,611) Other financing sources(uses): Capital lease obligation 38,999 38,500 (499) Issuance of long term note receivable 9,414 9,414 Operating transfers in 473,414 473,414 400,292 Total other financing sources(uses) 512,413 521,328 8,915 400,292 Excess(deficiency)of revenues and - other financing sources over expenditures and other financing uses (236,490) 230,292 466,782 380,681 Fund balance January 1 6,904,402 6,904,402 6,509,737 Residual equity transfers in(out) 13,984 Fund balance December 31 $6,667,912 $7,134,694 $466,782 $6,904,402 66 _ Exhibit B-3 CITY OF FRIDLEY, MINNESOTA GENERAL FUND SCHEDULE OF REVENUES AND OTHER FINANCING SOURCES- BUDGET AND ACTUAL Year Ended December 31, 1994 With Comparative Actual Amounts for Year Ended December 31, 1993 1994 Variance Favorable 1993 Budget Actual (Unfavorable) Actual Taxes and special assessments: Current ad valorem taxes $3,489,601 $3,505,354 $15,753 $3,450,431 Delinquent ad valorem taxes 40,000 5,246 (34,754) 154,119 - Penalties and interest 22,047 17,335 (4,712) 57,856 Forfeited sale-taxes 4,500 1,421 (3,079) 5,585 Special assessments 1,896 3,975 2,079 2,896 - Total taxes and special assessments 3,558,044 3,533,331 (24,713) 3,670,887 Licenses and permits: Licenses- Contractor 20,000 10,910 (9,090) 8,435 Business 76,640 67,759 (8,881) 79,078 All other 35,630 76,199 40,569 25,004 - Permits 288,356 284,369 (3,987) 209,684 Total licenses and permits 420,626 439,237 18,611 322,201 Intergovernmental revenue: Civil defense 5,803 4,206 (1,597) 8,424 State maintenance aid 201,663 191,698 (9,965) 201,663 State credits 1,057,010 1,065,611 8,601 1,023,565 Local government aid 1,558,917 1,558,917 1,523,365 Other state grants 31,218 31,218 30,117 Police and fire pension 227,842 250,410 22,568 243,224 - Other 3,027 7,786 4,759 _ 3,007 • Total intergovernmental revenue 3,054,262 3,109,846 55,584 3,033,365 - Charges for services: General government 566,403 642,034 75,631 557,674 Public safety 104,802 70,418 (34,384) 80,190 _ Conservation of health 2,977 3,477 500 3,898 Recreation 175,263 176,542 1,279 145,980 Total charges for services 849,445 892,471 43,026 787,742 - Fine and forfeits 242,392 184,024 (58,368) 198,190 Interest on investments 430,000 402,563 (27,437) 541,163 (Continued) 67 Exhibit B-3 Continued CITY OF FRIDLEY, MINNESOTA GENERAL FUND SCHEDULE OF REVENUES AND OTHER FINANCING SOURCES-BUDGET AND ACTUAL Year Ended December 31. 1994 With Comparative Actual Amounts for Year Ended December 31, 1993 1994 Variance Favorable 1993 Budget Actual (Unfavorable) Actual _ Miscellaneous revenue: Rent income $6,186 $5,045 ($1,141) $3,905 Sale of property 23,072 26,832 3,760 15,212 Donations 32,489 38,335 5,846 26,685 Miscellaneous 93,485 114,984 21,499 84,759 Total miscellaneous revenue 155,232 185,196 29,964 130,561 Total revenues 8,710,001 8,746,668 36,667 8,684,109 ._ Other financing sources: Capital lease obligation 38,999 38,500 (499) _ Issuance of long term note receivable 9,414 9,414 Operating transfers in- Employee Benefit Fund 200,000 200,000 100,000 _ Liquor Fund 25,000 25,000 Special Assessment Debt Service Fund 248,414 248,414 300,292 Total other financing sources 512,413 521,328 8,915 400,292 Total revenues and other financing sources $9,222,414 $9,267,996 $45,582 $9,084,401 68 Exhibit B-4 CITY OF FRIDLEY. MINNESOTA GENERAL FUND SCHEDULE OF EXPENDITURES AND OTHER FINANCING USES- BUDGET AND ACTUAL -' Year Ended December 31. 1994 With Comparative Actual Amounts for Year Ended December 31, 1993 1994 Variance Favorable 1993 Budget Actual (Unfavorable) Actual General government: Mayor and Council - Personal services $51,705 $48,825 $2,880 $48,015 Supplies and other charges 41,187 36,792 4,395 46,689 92,892 85,617 7,275 94,704 Planning commission- Supplies and other charges 3,523 181 3,342 794 3,523 181 3,342 794 Other commissions- Supplies and other charges 9,145 9,145 3,058 9,145 9,145 3,058 City manager- Personal services 262,582 243,805 18,777 235,778 Supplies and other charges 45,685 41,994 3,691 40,834 308,267 285,799 22,468 276,612 - Personnel- Personal services 78,337 78,337 73,519 Supplies and other charges 13,655 8,449 5,206 9,267 91,992 86,786 5,206 82,786 Legal - Supplies and other charges 238,891 238,891 195,642 238,891 238,891 195,642 Elections- - Personal services 26,641 26,641 Supplies and other charges 3,160 1,764 1,396 713 29,801 28,405 1,396 713 (Continued) 69 Exhibit B-4 Continued CITY OF FRIDLEY, MINNESOTA GENERAL FUND - SCHEDULE OF EXPENDITURES AND OTHER FINANCING USES-BUDGET AND ACTUAL Year Ended December 31, 1994 With Comparative Actual Amounts for Year Ended December 31, 1993 1994 - Variance Favorable 1993 Budget Actual (Unfavorable) Actual General government(continued): Accounting- Personal services $420,748 $414,747 $6,001 $400,456 Supplies and other charges 71,941 65,240 6,701 60,813 492,689 479,987 12,702 461,269 Assessing- Personal services 153,265 122,720 30,545 136,097 Supplies and other charges 14,972 7,000 7,972 17,997 168,237 129,720 38,517 154,094 MIS- Personal services 94,291 92,403 1,888 96,812 Supplies and other charges 64,958 53,416 11,542 37,544 159,249 145,819 13,430 134,356 City clerk/records- - Personal services 85,758 84,507 1,251 80,979 Supplies and other charges 11,220 6,170 5,050 5,567 96,978 90,677 6,301 86,546 Nondepartmental- Personal services 4,000 1,166 2,834 166 Supplies and other charges 76,701 48,274 28,427 57,360 80,701 49,440 31,261 57,526 Total general government 1,772,365 1,630,467 141,898 1,548,100 (Continued) 70 Exhibit B-4 Continued CITY OF FRIDLEY, MINNESOTA - GENERAL FUND SCHEDULE OF EXPENDITURES AND OTHER FINANCING USES- BUDGET AND ACTUAL Year Ended December 31, 1994 - With Comparative Actual Amounts for Year Ended December 31, 1993 - 1994 Variance Favorable 1993 - Budget Actual (Unfavorable) Actual Public safety: - Police- Personal services $2,638,343 $2,593,585 $44,758 $2,476,715 Supplies and other charges 294,695 290,004 4,691 287,660 - 2,933,038 2,883,589 49,449 2,764,375 Fire- Personal services 598,091 548,568 49,523 541,774 Supplies and other charges 103,092 101,142 1,950 93,106 701,183 649,710 51,473 634,880 - Rental inspections Personal services 12,347 7,234 5,113 _ Supplies and other charges 6,494 2,742 3,752 18,841 9,976 8,865 Civil defense- - Supplies and other charges 8,784 6,703 2,081 6,112 8,784 6,703 2,081 6,112 - Total public safety 3,661,846 3,549,978 111,868 3,405,367 - Municipal center: Personal services 27,243 22,529 4,714 24,469 Supplies and other charges 160,531 157,575 2,956 145,024 - Total municipal center 187,774 180,104 7,670 169,493 _ Public works: Engineering- Personal services 395,330 384,280 11,050 367,542 Supplies and other charges 56,599 56,599 42,854 451,929 440,879 11,050 410,396 Public works and parks: Personal services 1,027,512 987,195 40,317 1,029,256 Supplies and other charges 716,723 716,723 707,348 1,744,235 1,703,918 40,317 1,736,604 Total public works 2,196,164 2,144,797 51,367 2,147,000 (Continued) 71 Exhibit B-4 Continued CITY OF FRIDLEY. MINNESOTA GENERAL FUND SCHEDULE OF EXPENDITURES AND OTHER FINANCING USES-BUDGET AND ACTUAL Year Ended December 31, 1994 - With Comparative Actual Amounts for Year Ended December 31, 1993 1994 Variance Favorable 1993 Budget Actual (Unfavorable) Actual Community Development: Building inspection - Personal services $102,508 $83,544 $18,964 $130,781 Supplies and other charges 91,984 91,984 44,773 194,492 175,528 18,964 175,554 Planning- Personal services 232,373 232,373 202,241 Supplies and other charges 54,714 54,714 29,675 287,087 287,087 231,916 - Total community development 481,579 462,615 18,964 407,470 Recreation and Naturalist: Recreation- Personal services 420,363 391,317 29,046 364,313 "" Supplies and other charges 154,793 149,871 4,922 129,149 575,156 541,188 33,968 493,462 Naturalist- Personal services 178,154 178,154 166,467 Supplies and other charges 62,814 60,900 1,914 60,830 240,968 239,054 1,914 227,297 Total recreation and naturalist 816,124 780,242 35,882 720,759 - Reserve for contingency- 41,919 41,919 (Continued) 72 Exhibit B-4 Continued CITY OF FRIDLEY, MINNESOTA GENERAL FUND SCHEDULE OF EXPENDITURES AND OTHER FINANCING USES- BUDGET AND ACTUAL Year Ended December 31, 1994 With Comparative Actual Amounts for Year Ended December 31, 1993 -- 1994 Variance Favorable 1993 Budget Actual (Unfavorable) Actual Capital outlay expenditures- - City manager $ $ $ $2,654 Personnel 1,698 Accounting 600 600 MIS 5,223 City clerk/records 5,347 Police 95,851 95,851 82,690 Fire 46,158 42,625 3,533 58,744 Rental inspections 8,971 6,314 2,657 Municipal center 4,433 4,433 Building inspection 1,526 1,526 15,000 Planning 3,847 3,847 Engineering 600 552 48 4,090 Public works 107,262 106,416 846 109,423 Naturalist 3,780 3,585 195 Recreation 9,275 9,180 95 20,662 Total capital outlay 282,303 274,929 7,374 305,531 Debt service- - Principal 12,018 12,018 Interest 6,812 2,554 4,258 Total debt service 18,830 14,572 4,258 Total expenditures $9,458,904 $9,037,704 $421,200 $9,338,600 73 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 Funr! This fund receives revenues from the issuance of a franchise agreement with the cable TV provider. These revenues are used for the operation and maintenance of a government access channel. • Grant Management Fund 'f r This fund administers grants received from a variety of intergovernmental agencies. In most cases, � gS r grant funds are provided on a reimbursement basis following proper documentation of expenditures, however, in some cases the money is provided in advance to be spent on specific activities outlined H, in the grant. ;. Solid Waste Abatement Fund This fund receives grants, recycling fees and yard waste fees. These revenues finance the City's curbside recycling pickup and operation of the yard waste transfer site. 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 equally between the investigating agency and the prosecuting agency. 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. HRA Housing Fund This fund receives tax increments in order to administer the Housing and Redevelopment Authority's housing rehabilitation programs. The HRA has targeted the removal of blighted property and low interest improvement loans to older houses as major housing issues for the City. Housing Revitalization Fund This fund receives revenues to administer the City Council's priority of improving housing rehabilitation , programs to revitalize aging neighborhoods in the community. • CITY OF FRIDLEY, MINNESOTA SPECIAL REVENUE FUNDS - COMBINING BALANCE SHEET December 31, 1994 With Comparative Totals for December 31, 1993 - Solid Waste - Cable Grant Abatement TV Management Fund Assets Cash and cash equivalents $10,000 $ $ - Investments 135,862 21,873 Receivables: Accounts 23,401 263 12,982 - Mortgages Deferred Due from other funds 12,411 - Due from other governments 159,673 28,585 Total assets $169,263 $172,347 $63,440 - Liabilities and Fund Balance - Liabilities: Accounts payable $9,137 $17,942 $13,726 Deposits payable 10,000 75,000 Salaries payable 319 700 678 Due to other funds 71,245 Due to other governments 121 Total liabilities 19,577 164,887 14,404 Fund balance: Reserved- Reserved for encumbrances 2,669 517 Reserved for long-term receivables Unreserved- Designated for subsequent year's expenditures 29,832 6,943 11,988 Designated for special revenue programs 117,185 37,048 Total fund balance 149,686 7,460 49,036 Total liabilities and fund balance $169,263 $172,347 $63,440 "' 76 Exhibit C-1 Drug& Gambling HRA Forfeiture HRA Housing Totals Reimbursement Fund Housing Revitalization 1994 1993 $ $ $18,077 $ $28,077 $10,000 .. 10,383 168,118 168,280 36,646 35,219 - 6,614 6,614 472 266 12,677 8,561 - 188,258 79,330 $266 $10,383 $24,691 $0 $440,390 $301,862 $39 $ $4,061 $44,905 $30,844 500 85,500 10,000 966 2,663 2,805 227 12,550 84,022 32,899 121 146 266 18,077 217,211 76,694 3,186 1,000 - 6,614 6,614 472 - 48,763 52,405 10,383 164,616 171,291 10,383 6,614 223,179 225,168 $266 $10,383 $24,691 $0 $440,390 $301,862 - 77 CITY OF FRIDLEY. MINNESOTA SPECIAL REVENUE FUNDS — COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES Year Ended December 31, 1994 With Comparative Totals for Year Ended December 31, 1993 — Solid Waste — Cable Grant Abatement TV Management Fund Revenues: Charges for services $ $ $146,392 — Fines and forfeits Licenses and permits 88,874 Intergovernmental revenue 317,434 53,425 — Interest on investments 8,613 Miscellaneous 1,667 392 Total revenues 99,154 317,826 199,817 — Expenditures: Current- General government 87,099 312,211 208,034 Public safety Capital outlay 16,146 — Total expenditures 103,245 312,211 208,034 Excess(deficiency)of revenues — over expenditures (4,091) 5,615 (8,217) Other financing sources(uses): — Operating transfers in Total other financing sources(uses) Excess(deficiency)of revenues and other financing sources over expenditures and other financing uses (4,091) 5,615 (8,217) — Fund balance January 1 153,777 1,845 57,253 Fund balance December 31 $149,686 $7,460 $49,036 78 Exhibit C-2 Drug& Gambling - HRA Forfeiture HRA Housing Totals Reimbursement Fund Housing Revitalization 1994 1993 $ $ $ $ $146,392 $101,533 - 1,396 1,396 5,602 88,874 87,934 9,991 380,850 179,058 - 8,613 20,977 253 2,312 74,205 9,991 1,396 253 628,437 469,309 9,991 104,371 8,966 730,672 425,065 2,834 2,834 7,930 315,373 106,106 437,625 64,725 9,991 2,834 419,744 115,072 1,171,131 497,720 - (1,438) (419,491) (115,072) (542,694) (28,411) - 425,633 115,072 540,705 79,067 425,633 115,072 540,705 79,067 (1,438) 6,142 (1,989) 50,656 11,821 472 225,168 174,512 - $0 $10,383 $6,614 $0 $223,179 $225,168 79 Exhibit C-3 CITY OF FRIDLEY, MINNESOTA CABLE TV SPECIAL REVENUE FUND COMPARATIVE BALANCE SHEET — December 31, 1994 and 1993 1994 1993 Assets — Cash and cash equivalents $10,000 $10,000 Investments 135,862 142,883 — Accounts receivable 23,401 22,036 Total assets $169,263 $174,919 — Liabilities and Fund Balance — Liabilities: Accounts payable $9,137 $10,811 — Deposits payable 10,000 10,000 Salaries payable 319 331 Due to other governments 121 — Total liabilities 19,577 21,142 Fund balance: -- Reserved for encumbrances 2,669 Unreserved- Designated for subsequent year's expenditures 29,832 18,669 Designated for cable TV program 117,185 135,108 Total fund balance 149,686 153,777 Total liabilities and fund balance $169,263 $174,919 80 Exhibit C-4 CITY OF FRIDLEY. MINNESOTA CABLE TV SPECIAL REVENUE FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE- BUDGET AND ACTUAL Year Ended December 31, 1994 With Comparative Amounts for Year Ended December 31, 1993 1994 Variance Favorable 1993 Budget Actual (Unfavorable) Actual Revenues: Licenses-franchise fee $91,369 $88,874 ($2,495) $87,934 Interest on investments 5,865 8,613 2,748 20,977 Donations 73,200 Miscellaneous 1,667 1,667 -. Total revenues 97,234 99,154 1,920 182,111 Expenditures: Current General government- Personal services 40,365 38,020 2,345 36,756 Supplies and other charges 52,110 49,079 3,031 50,898 Capital outlay 19,000 16,146 2,854 62,216 Total expenditures 111,475 103,245 8,230 149,870 Excess(deficiency)of revenues over expenditures (14,241) (4,091) 10,150 32,241 Fund balance January 1 153,777 153,777 121,536 Fund balance December 31 $139,536 $149,686 $10,150 $153,777 81 Exhibit C-5 CITY OF FRIDLEY. MINNESOTA GRANT MANAGEMENT SPECIAL REVENUE FUND COMPARATIVE BALANCE SHEET — December 31, 1994 and 1993 1994 1993 Assets — Accounts receivable $263 $751 Due from other funds 12,411 Due from other governments 159,673 23,027 Total assets $172,347 $23,778 Liabilities and Fund Balance Liabilities: Accounts payable $17,942 $4,251 Deposits payable 75,000 Salaries payable 700 958 Due to other funds 71,245 16,724 Total liabilities 164,887 21,933 Fund balance: Reserved - Reserved for encumbrances 517 1,000 Unreserved- Designated for subsequent year's expenditures 6,943 845 Total fund balance 7,460 1,845 — Total liabilities and fund balance $172,347 $23,778 82 Exhibit C-6 CITY OF FRIDLEY, MINNESOTA GRANT MANAGEMENT SPECIAL REVENUE FUND STATEMENT OF REVENUES. EXPENDITURES AND _ CHANGES IN FUND BALANCE-BUDGET AND ACTUAL Year Ended December 31, 1994 With Comparative Amounts for Year Ended December 31, 1993 1994 Variance Favorable 1993 Budget Actual (Unfavorable) Actual Revenues: Intergovernmental revenue- — Federal $143,222 $315,861 $172,639 $76,479 State 9,998 1,573 (8,425) 2,206 Donations 392 392 1,005 Total revenues 153,220 317,826 164,606 79,690 Expenditures: Current General government- Personal services 48,276 45,908 2,368 48,532 Supplies and other charges 266,303 266,303 29,681 Total expenditures 314,579 312,211 2,368 78,213 Excess(deficiency)of revenues over expenditures (161,359) 5,615 (155,744) 1,477 Fund balance January 1 1,845 1,845 368 — Fund balance December 31 ($159,514) $7,460 ($155,744) $1,845 83 Exhibit C-7 CITY OF FRIDLEY, MINNESOTA SOLID WASTE ABATEMENT SPECIAL REVENUE FUND COMPARATIVE BALANCE SHEET — December 31, 1994 and 1993 1994 1993 Assets — Investments $21,873 $13,576 Accounts receivable 12,982 12,432 Due from other governments 28,585 44,690 Total assets $63,440 $70,698 — Liabilities and Fund Balance -- Liabilities: Accounts payable $13,726 $12,785 — Salaries payable 678 660 Total liabilities 14,404 13,445 — Fund balance: Unreserved- — Designated for subsequent year's expenditures 11,988 33,736 Designated for solid waste abatement 37,048 23,517 Total fund balance 49,036 57,253 Total liabilities and fund balance $63,440 $70,698 84 Exhibit C-8 CITY OF FRIDLEY. MINNESOTA SOLID WASTE ABATEMENT SPECIAL REVENUE FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE- BUDGET AND ACTUAL Year Ended December 31, 1994 With Comparative Amounts for Year Ended December 31, 1993 1994 Variance Favorable 1993 Budget Actual (Unfavorable) Actual Revenues: Intergovernmental revenue- - State $40,000 $53,425 $13,425 $84,059 Charges for services 144,320 146,392 2,072 101,533 Total revenues 184,320 199,817 15,497 185,592 Expenditures: Current General government- Personal services 44,163 41,195 2,968 42,031 Supplies and other charges 173,893 166,839 7,054 148,937 Total expenditures 218,056 208,034 10,022 190,968 Excess of revenues over expenditures (33,736) (8,217) 25,519 (5,376) Other financing sources(uses): Operating transfers in- Special Assessment Debt Service Fund 24,981 -. Excess(deficiency)of revenues and other financing sources over expenditures (33,736) (8,217) 25,519 19,605 Fund balance January 1 57,253 57,253 37,648 Fund balance December 31 $23,517 $49,036 $25,519 $57,253 85 Exhibit C-9 CITY OF FRIDLEY, MINNESOTA HRA REIMBURSEMENT SPECIAL REVENUE FUND, COMPARATIVE BALANCE SHEET — December 31, 1994 and 1993 1994 1993 Assets ._ Due from other funds $266 $8,561 — Total assets $266 $8,561 Liabilities and Fund Balance Liabilities: — Accounts payable $39 $ Due to other funds 227 8,561 Total liabilities 266 8,561 Fund balance: Unreserved-undesignated — Total liabilities and fund balance $266 $8,561 86 Exhibit C-10 CITY OF FRIDLEY, MINNESOTA HRA REIMBURSEMENT SPECIAL REVENUE FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE- BUDGET AND ACTUAL Year Ended December 31, 1994 With Comparative Amounts for Year Ended December 31, 1993 1994 _ Variance Favorable 1993 Budget Actual (Unfavorable) Actual Revenues: Intergovernmental revenue- Housing&Redevelopment Authority $9,991 $9,991 $ $16,314 Total revenues 9,991 9,991 16,314 Expenditures: Current General government- Supplies and other charges 9,991 9,991 16,314 Total expenditures 9,991 9,991 16,314 Excess of revenues over expenditures Fund balance January 1 Fund balance December 31 $0 $0 $0 $0 87 Exhibit C-11 CITY OF FRIDLEY, MINNESOTA DRUG AND GAMBLING FORFEITURE SPECIAL REVENUE FUND COMPARATIVE BALANCE SHEET — December 31, 1994 and 1993 1994 1993 Assets ,_ Investments $10,383 $11,821 Total assets $10,383 $11,821 Liabilities and Fund Balance Fund balance: — Unreserved-designated for drug and gambling enforcement $10,383 $11,821 Total liabilities and fund balance $10,383 $11,821 88 Exhibit C-12 CITY OF FRIDLEY, MINNESOTA DRUG AND GAMBLING FORFEITURE SPECIAL REVENUE FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE-BUDGET AND ACTUAL Year Ended December 31, 1994 With Comparative Amounts for Year Ended December 31, 1993 1994 Variance Favorable 1993 Budget Actual (Unfavorable) Actual — Revenues: Fines and forfeits $1,396 $1,396 $ $5,602 Total revenues 1,396 1,396 5,602 Expenditures: Current -' Public safety- Supplies and other charges 2,834 2,834 7,930 Capital outlay 811 Total expenditures 2,834 2,834 8,741 Excess of revenues over expenditures (1,438) (1,438) (3,139) Fund balance January 1 11,821 11,821 14,960 Fund balance December 31 $10,383 $10,383 $0 $11,821 89 Exhibit C-13 — CITY OF FRIDLEY, MINNESOTA HRA HOUSING SPECIAL REVENUE FUND COMPARATIVE BALANCE SHEET December 31, 1994 and 1993 1994 1993 Assets ,_ Cash and cash equivalents $18,077 $ Receivables: Mortgages- Deferred 6,614 472 Due from other governments 11,613 — Total assets $24,691 $12,085 Liabilities and Fund Balance -. Liabilities: Accounts payable $4,061 $2,997 Deposits payable 500 Salaries payable 966 856 Due to other funds 12,550 7,614 Due to other governments 146 Total liabilities 18,077 11,613 Fund balance: — Reserved for mortgages receivable 6,614 472 Total liabilities and fund balance $24,691 $12,085 ., 90 Exhibit C-14 CITY OF FRIDLEY, MINNESOTA HRA HOUSING SPECIAL REVENUE FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE-BUDGET AND ACTUAL Year Ended December 31, 1994 With Comparative Amounts for Year Ended December 31, 1993 1994 Variance Favorable 1993 Budget Actual (Unfavorable) Actual Revenues: Rent Income $253 $253 $ $ Expenditures: Current -. General government- Personal services 47,089 47,089 32,850 Supplies and other charges 57,282 57,282 19,066 Capital outlay 315,373 315,373 1,698 Total expenditures 419,744 419,744 53,614 Excess(deficiency)of revenues over expenditures (419,491) (419,491) (53,614) r- Other financing sources(uses): Operating transfer in- HRA Capital Project Fund 425,633 425,633 54,086 Excess(deficiency)of revenues and other financing sources over expenditures 6,142 6,142 472 Fund balance January 1 472 472 Fund balance December 31 $6,614 $6,614 $0 $472 91 Exhibit C-15 CITY OF FRIDLEY, MINNESOTA HOUSING REVITALIZATION SPECIAL REVENUE FUND COMPARATIVE BALANCE SHEET December 31, 1994 Assets Total assets $0 Liabilities and Fund Balance — Fund balance: Unreserved, Undesignated $0 92 Exhibit C-16 CITY OF FRIDLEY, MINNESOTA HOUSING REVITALIZATION SPECIAL REVENUE FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE-BUDGET AND ACTUAL Year Ended December 31, 1994 Variance Favorable Budget Actual (Unfavorable) Expenditures: Current General government- Supplies and other charges $8,966 $8,966 $ Capital Outlay 106,106 106,106 Total expenditures 115,072 115,072 Excess(deficiency)of revenues _ over expenditures (115,072) (115,072) Other financing sources(uses): — Operating transfer in- Special Assessment Debt Service Fund 115,072 115,072 Excess(deficiency)of revenues and other financing sources over expenditures Fund balance January 1 Fund balance December 31 $0 $0 $0 93 DEBT SERVICE FUNDS Debt Service Funds are used to finance and account for the payment of principal and interest on all general obligation debt excluding those accounted for in the proprietary funds. Special Assessment Fund This 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 be benefited from such improvements. HRA Fund This fund services the debt of the tax increment bonds. Tax increment money is used to service the debt on redevelopment related bonds. Exhibit D-1 CITY OF FRIDLEY. MINNESOTA DEBT SERVICE FUNDS COMBINING BALANCE SHEET December 31. 1994 With Comparative Totals for December 31, 1993 Special Totals Assessment HRA 1994 1993 Assets Cash and cash equivalents $ $1,061,695 $1,061,695 $1,049,631 Investments 9,462,421 9,462,421 11,902,335 Receivables: Special Assessments- Unremitted 3,193 3,193 16,830 Delinquents 93,714 93,714 87,105 Deferred 2,197,528 2,197,528 2,430,155 Total assets $11,756,856 $1,061,695 $12,818,551 $15,486,056 Liabilities and Fund Balance Liabilities: Accounts payable $ $102 $102 $595 Deferred revenue 2,291,242 2,291,242 2,517,260 _ Due to other funds 129,498 Due to other governments 2,301 2,301 Total liabilities 2,293,543 102 2,293,645 2,647,353 '- Fund balance: Reserved for debt service 482,530 1,061,593 1,544,123 3,878,456 Unreserved-undesignated 8,980,783 8,980,783 8,960,247 Total fund balance 9,463,313 1,061,593 10,524,906 12,838,703 Total liabilities and fund balance $11,756,856 $1,061,695 $12,818,551 $15,486,056 95 Exhibit D-2 CITY OF FRIDLEY, MINNESOTA DEBT SERVICE FUNDS — COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES Year Ended December 31, 1994 — With Comparative Totals for Year Ended December 31, 1993 Special Totals Assessment HRA 1994 1993 Revenues: Special assessments $478,634 $ $478,634 $499,961 Interest on investments 529,214 529,214 1,066,182 — Total revenues 1,007,848 1,007,848 1,566,143 Expenditures: Debt service- Principal retirement 2,000,000 305,000 2,305,000 925,000 Interest and fiscal charges 160,253 987,298 1,147,551 1,270,590 — Total expenditures 2,160,253 1,292,298 3,452,551 2,195,590 Excess(deficiency)of revenues over expenditures (1,152,405) (1,292,298) (2,444,703) (629,447) — Other financing sources(uses): Operating transfers in (out)- Bond proceeds 2,309 2,309 HRA Capital Projects Fund 1,304,368 1,304,368 1,940,968 General Fund (248,414) (248,414) (300,292) Housing Revitalization Special Revenue Fund (115,072) (115,072) Solid Waste Abatement Fund (24,981) Total other financing sources(uses) (361,177) 1,304,368 943,191 1,615,695 — Excess(deficiency)of revenues and other financing sources over expenditures and other financing uses (1,513,582) 12,070 (1,501,512) 986,248 Fund balance January 1 11,789,180 1,049,523 12,838,703 11,852,455 Residual equity transfer in(out) (812,285) (812,285) Fund balance December 31 $9,463,313 $1,061,593 $10,524,906 $12,838,703 96 CAPITAL PROJECTS FUNDS Capital Projects Funds are used to account for the resources expended to acquire permanent or long term assets. These funds are established to provide special accounting for bond proceeds, grants and contributions designated for the acquisition of capital assets. Capital Projects Funds provide a formal mechanism which enables administrators to ensure that revenues designated forspecific purposes are properly used. Capital Improvement Fund This 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. Special Assessment Fund This fund is used to account for the construction of public improvements, such as residential streets, sidewalks, and storm sewers or for the provision of services which are to be paid for primarily by the benefited property owner. HRA Fund This fund receives revenues from general property taxes in the form of tax increment and also from land sale proceeds. A board of commissioners is appointed by the City Council and they use these funds to purchase land in the City of Fridley for resale to developers of commercial facilities. CITY OF FRIDLEY, MINNESOTA CAPITAL PROJECTS FUNDS COMBINING BALANCE SHEET December 31, 1994 With Comparative Totals for December 31, 1993 Capital Special Improvements Assessments Assets — Cash and cash equivalents $ $ Investments 8,554,915 353,643 _ Receivables: Accounts Taxes- Unremitted 333 Delinquent 3,204 Specials- — Delinquent Deferred 48,763 Mortgage- — Deferred Interest Due from other funds — Total assets $8,558,452 $402,406 Liabilities and Fund Balance Liabilities: Accounts payable $ $9,175 Deposits payable 77,088 — Contracts payable 132,000 25,268 Deferred revenue 3,204 48,763 Due to other funds 670,672 — Due to other governments 145,479 Total liabilities 135,204 976,445 — Fund balance: Reserved for encumbrances 865,353 Reserved for construction _ Reserved for long-term receivables Unreserved- Designated for fixed asset replacement 1,728,644 — Designated for park improvements 707,381 Designated for street improvements 5,121,870 Undesignated (574,039) — Total fund balance 8,423,248 (574,039) Total liabilities and fund balance $8,558,452 $402,406 98 Exhibit E-1 Totals HRA 1994 1993 $14,305 $14,305 $258,143 8,523,103 17,431,661 17,688,285 650 650 1,037 _ 93,022 93,355 87,575 331,848 335,052 318,119 99 48,763 26,721 _ 1,134,807 1,134,807 1,083,564 90,695 90,695 62,149 135,288 $10,188,430 $19,149,288 $19,660,980 $31,524 $40,699 $18,273 77,088 89,682 _ 157,268 58,926 331,848 383,815 344,939 127 670,799 939,713 150,858 296,337 191,555 514,357 1,626,006 1,643,088 865,353 797,636 8,539,266 8,539,266 8,225,314 1,134,807 1,134,807 1,083,564 1,728,644 1,964,774 _ 707,381 839,940 5,121,870 5,768,463 (574,039) (661,799) 9,674,073 17,523,282 18,017,892 $10,188,430 $19,149,288 $19,660,980 99 CITY OF FRIDLEY. MINNESOTA CAPITAL PROJECTS FUNDS COMBINING STATEMENT OF REVENUES, EXPENDITURES AND -" CHANGES IN FUND BALANCE Year Ended December 31, 1994 With Comparative Totals for Year Ended December 31, 1993 Capital Special Improvements Assessments Revenues: Taxes- Tax increment $ $ Current ad valorem taxes 70,698 Delinquent ad valorem taxes 103 Special assessments 12,420 Total taxes 70,801 12,420 Intergovernmental revenue- -' State credits 15,000 State aid for construction 303,132 Total intergovernmental revenue 318,132 Charges for services- General government -' Total charges for services Interest on investments 475,046 17,562 -' Miscellaneous revenue- Rental income — Donations 34,874 Other 1,868 Total miscellaneous revenue 36,742 0 Total revenues 900,721 29,982 100 _ Exhibit E-2 - Totals HRA 1994 1993 $2,734,021 $2,734,021 $3,164,395 -- 70,698 71,254 103 3,109 86,268 98,688 111,789 — 2,820,289 2,903,510 3,350,547 -- 15,000 15,000 303,132 1,190,412 318,132 1,205,412 39,461 39,461 502,927 995,535 1,401,365 43,165 43,165 70,828 34,874 106,125 4,703 6,571 4,705 47,868 84,610 181,658 3,371,084 4,301,787 6,178,443 101 CITY OF FRIDLEY, MINNESOTA CAPITAL PROJECTS FUNDS COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE(Continued) Year Ended December 31, 1994 With Comparative Totals for Year Ended December 31, 1993 Capital Special Improvements Assessments Expenditures: Current- General government $ $ Public works 202,268 126,063 Debt service- _ Loan principal 3,685 Interest 8,616 Bond issuance costs 16,365 _ Capital outlay 750,723 838,168 Total expenditures 952,991 992,897 Excess(deficiency)of revenues over expenditures (52,270) (962,915) — Other financing sources(uses): Bond proceeds 155,380 Operating transfers in(out)- _ HRA Special Revenue Fund HRA Debt Service Fund Capital Improvement Fund 895,295 _ Special Assessment Capital Projects Fund (895,295) Total other financing sources(uses) (895,295) 1,050,675 Excess(deficiency)of revenues and other financing sources over expenditures and other financing uses (947,565) 87,760 _ Fund balance deficit January 1 9,370,813 (661,799) Residual Equity Transfer in (out) Fund balance(deficit)December 31 $8,423,248 ($574,039) 102 _ Exhibit E-2 Continued Totals HRA 1994 1993 $845,803 $845,803 $639,776 — 328,331 229,990 3,685 3,458 — 8,616 8,843 16,365 430,085 2,018,976 1,712,037 — 1,275,888 3,221,776 2,594,104 — 2,095,196 1,080,011 3,584,339 — 155,380 (425,633) (425,633) (54,086) — (1,304,368) (1,304,368) (1,940,968) 895,295 625,750 (895,295) (625,750) _ (1,730,001) (1,574,621) (1,995,054) 365,195 (494,610) 1,589,285 — 9,308,878 18,017,892 16,442,591 (13,984) $9,674,073 $17,523,282 $18,017,892 103 Exhibit E-3 CITY OF FRIDLEY, MINNESOTA CAPITAL IMPROVEMENTS CAPITAL PROJECT FUND COMPARATIVE BALANCE SHEET — December 31, 1994 and 1993 1994 1993 Assets -" Investments $8,554,915 $9,375,512 Receivables: — Taxes- Unremitted 333 925 Delinquent 3,204 7,060 — Total assets $8,558,452 $9,383,497 Liabilities and Fund Balance Liabilities: Accounts payable $ $5,624 Contracts payable 132,000 Deferred revenue 3,204 7,060 Total liabilities 135,204 12,684 Fund balance: Reserved for encumbrances 865,353 797,636 Unreserved- Designated for fixed asset replacement 1,728,644 1,964,774 Designated for park improvements 707,381 839,940 Designated for street improvements 5,121,870 5,768,463 Total fund balance 8,423,248 9,370,813 Total liabilities and fund balance $8,558,452 $9,383,497 104 Exhibit E-4 CITY OF FRIDLEY, MINNESOTA CAPITAL IMPROVEMENTS CAPITAL PROJECT FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE- BUDGET AND ACTUAL Year Ended December 31, 1994 With Comparative Amounts for Year Ended December 31, 1993 1994 Variance Favorable 1993 Budget Actual (Unfavorable) Actual Revenues: Taxes- Current ad valorem taxes $70,550 $70,698 $148 $71,254 Delinquent ad valorem taxes 103 103 3,109 Total taxes 70,550 70,801 251 74,363 Intergovenmental revenue- State credits 15,000 15,000 15,000 State aid for construction 600,000 303,132 (296,868) 1,190,412 Total intergovernmental revenue 615,000 318,132 (296,868) 1,205,412 ,.., Interest on investments 418,672 475,046 56,374 856,230 Miscellaneous revenue- _„ Donations 10,000 34,874 24,874 106,125 Other 1,868 1,868 664 Total miscellaneous revenue 10,000 36,742 26,742 106,789 Total revenues 1,114,222 900,721 (213,501) 2,242,794 Expenditures: Current Public works 250,916 202,268 48,648 103,523 Capital outlay 1,457,834 750,723 707,111 397,178 Total expenditures 1,708,750 952,991 755,759 500,701 Excess(deficiency)of revenues over expenditures (594,528) (52,270) 542,258 1,742,093 _ Other financing sources(uses): Operating transfers in (out): Special Assessment Capital Projects Fund (895,295) (895,295) (625,750) Excess(deficiency)of revenues an other financing sources over expenditures and other financing uses (1,489,823) (947,565) 542,258 1,1 16,343 Fund balance January 1 9,370,813 9,370,813 8,254,470 Fund balance December 31 $7,880,990 $8,423,248 $542,258 $9,370,813 105 ENTERPRISE FUNDS Enterprise Funds are used to account for the operations of self-supporting governmental activities which render services or goods to the public. The accounting records are maintained on an accrual basis. The reporting for enterprise funds is similar to comparable private enterprises. Creditors, legislators or the general public can evaluate the performance of a municipal enterprise on the same basis as they can the performance of investor-owned enterprises. Liquor Fund This fund accounts for the operation of two off-sale liquor establishments. Public Utilities Fund This fund accounts for the operations of the City-owned sewer and water systems. CITY OF FRIDLEY, MINNESOTA Exhibit F-1 ENTERPRISE FUNDS COMBINING BALANCE SHEET December 31, 1994 With Comparative Totals for December 31, 1993 Public Totals Liquor Utilities 1994 1993 Assets Current Assets: Cash and cash equivalents $457,995 $4,423,461 $4,881,456 $5,664,926 - Investments 456,903 456,903 Accounts receivable 1,085,676 1,085,676 1,139,967 Due from other funds 235,460 235,460 2,120 - Due from other governments 21,311 21,311 20,492 Inventories, at cost 329,193 5,994 335,187 277,771 Prepaid items 257,963 257,963 223,500 - Total current assets 1,479,551 5,794,405 7,273,956 7,328,776 Restricted Assets: Cash and cash equivalents 425,603 Long-term receivable- Metro Waste Control Commission 439,249 439,249 213,540 - Property and equipment, at cost: Property and equipment 579,889 28,323,538 28,903,427 27,324,912 Less: accumulated depreciation (307,426) (8,680,232) (8,987,658) (8,334,082) - Net property and equipment 272,463 19,643,306 19,915,769 18,990,830 Total assets $1,752,014 $25,876,960 $27,628,974 $26,958,749 Liabilities and Fund Equity - Current liabilities: Accounts payable $178,000 $28,063 $206,063 $178,417 Contracts payable 9,680 9,680 134,658 Salaries payable 4,182 8,608 12,790 12,612 Due to other governments 30,737 385,537 416,274 439,822 Accrued interest payable 52,624 52,624 53,830 Bonds payable-current 85,000 85,000 80,000 Total current liabilities 212,919 569,512 782,431 899,339 Long-term liabilities: - Bonds payable 2,325,000 2,325,000 2,075,000 Total liabilities 212,919 2,894,512 3,107,431 2,974,339 Fund equity: Contributed capital 12,591,797 12,591,797 12,474,387 Retained earnings- Reserved for capital outlay 2,259,000 2,259,000 2,058,000 Reserved for construction 425,603 Unreserved 1,539,095 8,131,651 9,670,746 9,026,420 Total retained earnings 1,539,095 10,390,651 11,929,746 11,510,023 - Total fund equity 1,539,095 22,982,448 24,521,543 23,984,410 Total liabilities and fund equity $1,752,014 $25,876,960 $27,628,974 $26,958,749 107 CITY OF FRIDLEY, MINNESOTA - Exhibit F-2 ENTERPRISE FUNDS COMBINING STATEMENT OF REVENUES, EXPENSES AND CHANGES IN RETAINED EARNINGS - Year Ended December 31, 1994 With Comparative Totals for Year Ended December 31, 1993 Public Totals Liquor Utilities 1994 1993 - Sales and cost of sales: Sales $3,083,966 $ $3,083,966 $2,783,611 - Cost of sales 2,486,129 2,486,129 2,214,716 Gross profit 597,837 597,837 568,895 Operating revenues: - Water sales and sewer rents 3,871,358 3,871,358 3,436,041 Other 114,254 114,254 121,047 Total operating revenues 3,985,612 3,985,612 3,557,088 - Operating expenses: Personal services 316,594 736,846 1,053,440 1,004,333 - Supplies and other charges- Disposal charges 2,564,878 2,564,878 2,395,871 Other 156,906 605,085 761,991 850,026 - Depreciation 26,326 627,250 653,576 602,730 Total operating expenses 499,826 4,534,059 5,033,885 4,852,960 Operating income(loss) 98,011 (548,447) (450,436) (726,977) Non-operating revenues(expenses): - Interest on investments 54,316 230,405 284,721 481,390 Debt service (141,196) (141,196) (129,944) Other 4,413 23,284 27,697 7,374 - Total non-operating revenues(expenses) 58,729 112,493 171,222 358,820 Net income(loss)before operating transfers 156,740 (435,954) (279,214) (368,157) - Operating transfers in (out): General Fund (25,000) (25,000) Net income(loss)before - extraordinary item 131,740 (435,954) (304,214) (368,157) Extraordinary gain on issuance of sewer availability charge credits 364,000 364,000 Net income (loss) 131,740 (71,954) 59,786 (368,157) Credit arising from transfer of depreciation on contributed capital 359,937 359,937 337,065 Retained earnings January 1 1,407,355 10,102,668 11,510,023 11,541,115 Retained earnings December 31 $1,539,095 $10,390,651 $11,929,746 $11,510,023 - 108 _ Exhibit F-3 CITY OF FRIDLEY, MINNESOTA ENTERPRISE FUNDS COMBINING STATEMENT OF CASH FLOWS Year Ended December 31. 1994 With Comparative Totals for Year Ended December 31, 1993 Public Totals Liquor Utilities 1994 1993 - Cash flows from operating activities: Operating income $98,011 ($548,447) ($450,436) ($726,977) Adjustments to reconcile operating income (loss) .-. to net cash flows from operating activities: Depreciation 26,326 627,250 653,576 602,730 Changes in assets and liabilities: -. Decrease(increase) in receivables 76,563 76,563 (167,607) Decrease(increase)in due from other funds (235,460) 2,120 (233,340) 1,312 Decrease(increase) in inventories (60,889) 3,473 (57,416) (2,338) .-. Decrease(increase)in prepaid items (34,463) (34,463) (18,553) Increase(decrease)in payables 39,718 (161,626) (121,908) 270,255 Other non-operating revenue 4,413 23,284 27,697 7,374 Use of sewer availability charge credits 115,200 115,200 56,250 Net cash flows from operating activities (127,881) 103,354 (24,527) 22,446 - Cash flows from non-capital financing activities: Operating transfers in(out) (25,000) (25,000) Cash flows from capital and related financing activities: Acquisition and construction of fixed assets (3,595) (1,097,573) (1,101,168) (671,001) Proceeds from sale of revenue bonds 335,000 335,000 Principal paid on revenue bonds (80,000) (80,000) (45,000) Interest and paying agent fees on revenue bonds (141,196) (141,196) (129,944) Net cash flows from capital and related financing activities (3,595) (983,769) (987,364) (845,945) Cash flows from investing activities: Purchase of investment securities (456,903) (456,903) Proceeds from sale of investment securities 4,277,999 Interest on investments 54,316 230,325 284,641 474,128 Interest received from MWCC 80 80 7,262 Net cash flows from investing activities (402,587) 230,405 (172,182) 4,759,389 - Net increase(decrease)in cash and cash equivalents (559,063) (650,010) (1,209,073) 3,935,890 Cash and cash equivalents-January 1 1,017,058 5,073,471 6,090,529 2,154,639 - Cash and cash equivalents-December 31 $457,995 $4,423,461 $4,881,456 $6,090,529 Non-cash investing, capital and financing activities: System assets of$477,347 were contributed by the Capital Projects Special Assessment Fund to the Public Utility Enterprise Fund in 1994. A receivable for sewer availability charge credits from Metropolitan Council Wastewater Services, in the Wastewater Services, in the amount of$364,000,was recognized in the Public Utility Enterprise Fund in 1994. 109 Exhibit F-4 CITY OF FRIDLEY. MINNESOTA LIQUOR ENTERPRISE FUND COMPARATIVE BALANCE SHEET December 31, 1994 and 1993 1994 1993 Assets Current Assets: Cash and cash equivalents $457,995 $1,017,058 — Investments 456,903 Due from other funds 235,460 Inventories, at cost 329,193 268,304 — Total current assets 1,479,551 1,285,362 Property and equipment, at cost: Land 66,961 66,961 Buildings 178,897 178,897 Improvements other than building 86,759 86,759 — Machinery and equipment 247,272 243,677 579,889 576,294 Less: accumulated depreciation (307,426) (281,100) — Net property and equipment 272,463 295,194 Total assets $1,752,014 $1,580,556 — Liabilities and Fund Equity Current Liabilities: Accounts payable $178,000 $137,598 Salaries payable 4,182 4,262 Due to other governments 30,737 31,341 Total current liabilities 212,919 173,201 Fund equity: — Retained earnings—unreserved 1,539,095 1,407,355 Total liabilities and fund equity $1,752,014 $1,580,556 110 Exhibit F-5 CITY OF FRIDLEY, MINNESOTA LIQUOR ENTERPRISE FUND COMPARATIVE STATEMENT OF REVENUES, EXPENSES AND CHANGES IN RETAINED EARNINGS Years Ended December 31, 1994 and 1993 1994 1993 Sales and cost of sales: Sales $3,083,966 $2,783,611 Cost of sales 2,486,129 2,214,716 Gross profit 597,837 568,895 Operating expenses: Selling: Personal services 139,992 160,113 Supplies and other charges 61,044 59,839 Total selling expenses 201,036 219,952 Administration and overhead Personal services 176,602 128,060 Supplies and other charges 95,862 118,814 Depreciation 26,326 25,686 Total administration and overhead 298,790 272,560 Total operating expenses 499,826 492,512 Operating income 98,011 76,383 Non-operating revenues: Interest on investments 54,316 50,813 Other 4,413 5,307 Total non-operating revenues 58,729 56,120 Net income(loss)before operating transfers 156,740 132,503 Operating transfers in(out): General Fund (25,000) Net income 131,740 132,503 Retained earnings January 1 1,407,355 1,274,852 Retained earnings December 31 $1,539,095 $1,407,355 111 Exhibit F-6 CITY OF FRIDLEY, MINNESOTA LIQUOR ENTERPRISE FUND COMPARATIVE STATEMENT OF CASH FLOWS, — Years Ended December 31, 1994 and 1993 1994 1993 Cash flows from operating activities: Operating income $98,011 $76,383 Adjustments to reconcile operating income(loss)to net cash flows from operating activities: — Depreciation 26,326 25,686 Changes in assets and liabilities: Decrease(increase) in due from other funds (235,460) Decrease(increase) in inventories (60,889) (3,292) Decrease(increase) in prepaid items 6,625 Increases(decrease) in payables 39,718 4,062 — Other non-operating revenue 4,413 5,307 Net cash flows from operating activities (127,881) 114,771 — Cash flows fro non-capital financing activities: Operating transfers in (out) (25,000) — Cash flows from capital and related financing activities: — Acquisition and construction of fixed assets (3,595) (7,449) Cash flows from investing activities: — Purchase of investment securities (456,903) Interest on investments 54,316 50,813 Net cash flows for investing activities (402,587) 50,813 Net increase(decrease)in cash and cash equivalents (559,063) 158,135 Cash and cash equivalents-January 1 1,017,058 858,923 Cash and cash equivalents-December 31 $457,995 $1,017,058 112 Exhibit F-7 CITY OF FRIDLEY. MINNESOTA PUBLIC UTILITY ENTERPRISE FUND COMPARATIVE BALANCE SHEET December 31, 1994 and 1993 1994 1993 Assets Current assets: Cash &cash equivalents $4,423,461 $4,647,868 Receivables: Accounts 1,083,183 1,137,260 Taxes 2,493 2,707 Due from other funds 2,120 Due from other governments 21,311 20,492 Inventories, at cost 5,994 9,467 Prepaid items 257,963 223,500 Total current assets 5,794,405 6,043,414 Restricted assets: -. Cash and cash equivalents 425,603 Long-term receivable- Metropolitan Waste Control Commission 439,249 213,540 Property and equipment, at cost: Land 154,531 154,531 Buildings 1,529,236 1,529,236 Improvements other than building 6,370,544 5,311,529 Machinery and equipment 2,281,441 2,242,884 _ Water and sewer lines 17,987,786 17,510,438 28,323,538 26,748,618 Less: accumulated depreciation (8,680,232) (8,052,982) _ Net property and equipment 19,643,306 18,695,636 Total assets $25,876,960 $25,378,193 Liabilities and Fund Equity Current liabilities: Accounts payable $28,063 $40,819 Contracts payable 9,680 134,658 —' Salaries payable 8,608 8,350 Due to other governments 385,537 408,481 Accrued interest payable 52,624 53,830 Bonds payable-current 85,000 80,000 Total current liabilities 569,512 726,138 Long term liabilities: Bonds payable 2,325,000 2,075,000 Total liabilities 2,894,512 2,801,138 _ Fund Equity: Contributed capital 12,591,797 12,474,387 Retained earnings: Reserved for capital outlay 2,259,000 2,058,000 Reserved for construction 425,603 Unreserved 8,131,651 7,619,065 -. Total retained earnings 10,390,651 10,102,668 Total fund equity 22,982,448 22,577,055 Total liabilities and fund equity $25,876,960 $25,378,193 113 Exhibit F-8 CITY OF FRIDLEY, MINNESOTA PUBLIC UTILITY ENTERPRISE FUND COMPARATIVE STATEMENT OF REVENUES, EXPENSES AND CHANGES IN RETAINED EARNINGS Years Ended December 31, 1994 and 1993 1994 1993 _ Operating revenues: Water sales and sewer rents $3,871,358 $3,436,041 Other 114,254 121,047 Total operating revenues 3,985,612 3,557,088 — Operating expenses: Personal services 736,846 716,160 Supplies and other charges- Disposal charges 2,564,878 2,395,871 Other 605,085 671,373 Depreciation: Purchased assets 267,313 239,979 Contributed assets 359,937 337,065 Total operating expenses 4,534,059 4,360,448 — Operating loss (548,447) (803,360) — Non-operating revenues(expenses): Interest on investments 230,405 430,577 Debt service (141,196) (129,944) Other 23,284 2,067 Total non-operating revenues (expenses) 112,493 302,700 Net income(loss)before extraordinary item (435,954) (500,660) — Extraordinary gain on issuance of sewer availability Charge credits 364,000 Net income(loss) (71,954) (500,660) Credit arising from transfer of depreciation on contributed capital 359,937 337,065 Retained earnings January 1 10,102,668 10,266,263 Retained earnings December 31 $10,390,651 $10,102,668 114 Exhibit F-9 CITY OF FRIDLEY, MINNESOTA PUBLIC UTILITY ENTERPRISE FUND COMPARATIVE STATEMENT OF CASH FLOWS Years Ended December 31, 1994 and 1993 — 1994 1993 Cash flows from operating activities: Operating income(loss) ($548,447) ($803,360) Adjustment to reconcile operating income(loss)to net cash flows from operating activities: Depreciation 627,250 577,044 Changes in assets and liabilities: Decrease(increase)in receivables 76,563 (167,607) Decrease(increase) in due from other funds 2,120 1,312 Decrease(increase)in inventories 3,473 954 Decrease(increase)in prepaid items (34,463) (25,178) _ Increase(decrease)in payables (161,626) 266,193 Other non-operating revenue 23,284 2,067 Use of sewer availability charge credits 115,200 56,250 Net cash flows from operating activities 103,354 (92,325) Cash flows from capital and related financing activities: Acquisition and construction of fixed assets (1,097,573) (663,552) Proceeds from sale of revenue bonds 335,000 Principal paid on revenue bonds (80,000) (45,000) Interest and paying agent fees on revenue bonds (141,196) (129,944) Net cash flows from capital and related financing activities (983,769) (838,496) Cash flows from investing activities: Proceeds from sale of investment securities 4,277,999 Interest on investments 230,325 423,315 Interest received from MWCC 80 7,262 Net cash flows from investing activities 230,405 4,708,576 Net increase(decrease)in cash and cash equivalents (650,010) 3,777,755 Cash and cash equivalents-January 1 5,073,471 1,295,716 Cash and cash equivalents-December 31 $4,423,461 $5,073,471 Non-cash investing, capital and financing activities: System assets of$477,347 were contributed by the Capital Projects Special Assessment Fund to the Public Utility Enterprise Fund in 1994. A receivable for sewer availability charge credits from Metropolitan Council Wastewater Services, in the amount of$364,000,was recognized in the Public Utility Enterprise Fund in 1994. 115 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 ski jre:y rtin, 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. fi Employee Benefits Fund This fund is used to account for the expenses associated with providing fringe benefits for the City of Fridley employees. Self Insurance Fund i:. This fund is used to account for all revenues and expenses associated with the $50,000 deductible in the City 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. .,KK Exhibit G-1 CITY OF FRIDLEY, MINNESOTA INTERNAL SERVICE FUNDS COMBINING BALANCE SHEET December 31, 1994 With Comparative Totals for December 31, 1993 Employee Self Information Totals Benefits Insurance Systems 1994 1993 Assets Current assets: Cash and cash equivalents $5,077 $ $ $5,077 $1,323,397 Investments 1,139,509 829,643 820,125 2,789,277 77,335 Accounts receivable 231 Due from other funds 926,498 926,498 1,345,171 Total current assets 1,144,586 1,756,141 820,125 3,720,852 2,746,134 - Property and equipment, at cost: Property and equipment 819,572 819,572 Less: accumulated depreciation (561,735) (561,735) Net property and equipment 257,837 257,837 Total assets $1,144,586 $1,756,141 $1,077,962 $3,978,689 $2,746,134 Liabilities and Fund Equity Current liabilities: Accounts payable $4,338 $877 $ $5,215 $827 Payroll deductions payable 57,707 57,707 56,988 Compensated absences payable 820,755 820,755 815,003 Due to other funds 170,106 170,106 Total liabilities 1,052,906 877 1,053,783 872,818 Fund equity: Contributed capital 1,000,000 1,008,743 2,008,743 1,000,000 Retained earnings: Reserved for employee benefits 91,680 91,680 268,362 Reserved for equipment acquisition 69,219 69,219 Unreserved- Designated for future losses 755,264 755,264 604,954 Total fund equity 91,680 1,755,264 1,077,962 2,924,906 1,873,316 Total liabilities and fund equity $1,144,586 $1,756,141 $1,077,962 $3,978,689 $2,746,134 117 Exhibit G-2 CITY OF FRIDLEY, MINNESOTA INTERNAL SERVICE FUNDS _ COMBINING STATEMENT OF REVENUES, EXPENSES AND CHANGES IN RETAINED EARNINGS Year Ended December 31 1994 With Comparative Totals for Year Ended December 31, 1993 Employee Self Information Totals Benefits Insurance Systems 1994 1993 Operating revenues: Charges for services $15,172 $ $64,949 $80,121 $29,075 Insurance reimbursement 140,607 140,607 107,501 Total operating revenues 15,172 140,607 64,949 220,728 136,576 Operating expenses: Personal services 52,475 52,475 53,425 Supplies and other charges 4,332 64,394 2,159 70,885 35,926 Depreciation 64,949 64,949 Total operating expenses 56,807 64,394 67,108 188,309 89,351 Operating income(loss) (41,635) 76,213 (2,159) 32,419 47,225 Non operating revenues: Interest on investments 64,953 74,097 11,397 150,447 229,711 Income before operating transfers 23,318 150,310 9,238 182,866 276,936 Operating transfers out: General Fund (200,000) (200,000) (100,000) Net income(loss) (176,682) 150,310 9,238 (17,134) 176,936 Credit arising from transfer of depreciation on contributed capital 59,981 59,981 Retained earnings January 1 268,362 604,954 873,316 696,380 Retained earnings December 31 $91,680 $755,264 $69,219 $916,163 $873,316 118 CITY OF FRIDLEY, MINNESOTA Exhibit G-3 INTERNAL SERVICE FUNDS COMBINING STATEMENT OF CASH FLOWS Year Ended December 31, 1994 With Comparative Totals for Year Ended December 31, 1993 Employee Self Information Totals Benefits Insurance Systems 1994 1993 Cash flows from operating activities: — Operating income (loss) ($41,635) $76,213 ($2,159) $32,419 $47,225 Adjustments to reconcile operating income (loss)to net cash flows from - operating activities: Depreciation 64,949 64,949 Changes in assets and liabilities: Decrease(increase) in due from other funds 109 (720,945) (720,836) 140,212 Decrease (increase) in accounts receivables 22 209 231 (231) Increase (decrease) in accounts payable 4,073 315 4,388 (16,140) Increase (decrease) in compensated absences payable 5,752 5,752 (90,755) Increase (decrease) in payroll deductions payable 719 719 (3,040) Increase (decrease) in due from other funds 170,106 170,106 (3,040) Net cash flows from operating activities 139,146 (644,208) 62,790 (442,272) 74,231 Cash flows from non-capital financing activities: Operating transfers to General Fund (200,000) (200,000) (100,000) - Net cash flows from non-capital financing activities (200,000) (200,000) (100,000) — Cash flows from capital and related financing activities: Acquisition of fixed assets (66,347) (66,347) — Contributed capital 812,285 812,285 Net Cash flows from capital and related financing activities 745,938 745938 Cash flows from investing activities: Purchase of investment securities (752,308) (820,125) (1,572,433) (77,335) — Interest on investments 64,953 74,097 11,397 150,447 229,711 Net cash flows from investing activities 64,953 (678,211) (808,728) (1,421,986) 152,376 — Net increase(decrease) in cash and cash equivalents 4,099 (1,322,419) (1,318,320) 126,607 — Cash and cash equivalents-January 1 978 1,322,419 1,323,397 1,193,750 Cash and cash equivalents- December 31 $5,077 $0 $0 $5,077 $1,320,357 Non-cash investing, capital and financing activities: Computer Equipment of$256,439 was contributed from the General Fixed Assets — account group to the Information Systems Internal Service Fund during 1994. 119 Exhibit G-4 CITY OF FRIDLEY, MINNESOTA EMPLOYEE BENEFITS INTERNAL SERVICE FUND COMPARATIVE BALANCE SHEET — December 31, 1994 and 1993 1994 1993 Assets — Cash and cash equivalents $5,077 $978 Due from other funds 1,139,509 1,139,618 — Accounts receivable 22 Total assets $1,144,586 $1,140,618 Liabilities and Fund Equity Current Liabilities: Accounts payable $4,338 $265 Compensated absences payable 820,755 815,003 Payroll deductions payable 57,707 56,988 — Due to other funds 170,106 Total current liabilities 1,052,906 872,256 — Fund equity: Retained earnings- Reserved for employee benefits 91,680 268,362 Total current liability and fund equity $1,144,586 $1,140,618 120 Exhibit G-5 - CITY OF FRIDLEY, MINNESOTA EMPLOYEE BENEFITS INTERNAL SERVICE FUND COMPARATIVE STATEMENT OF REVENUES, — EXPENSES AND CHANGES IN RETAINED EARNINGS Years Ended December 31, 1994 and 1993 1994 1993 Operating revenues: Charges for services $15,172 $29,075 Operating expenses: General government- - Personal services 52,475 53,425 Supplies and other charges 4,332 2,990 Total operating expenses 56,807 56,415 Operating income(loss) (41,635) (27,340) — Non-operating revenues: Interest on investments 64,953 116,097 Total non-operating revenues 64,953 116,097 Income before operating transfers 23,318 88,757 Operating transfers out: General Fund (200,000) (100,000) Net income(loss) (176,682) (11,243) — Retained earnings January 1 268,362 279,605 Retained earnings December 31 $91,680 $268,362 121 Exhibit G-6 CITY OF FRIDLEY, MINNESOTA EMPLOYEE BENEFITS INTERNAL SERVICE FUND COMPARATIVE STATEMENT OF CASH FLOWS — Years Ended December 31, 1994 and 1993 1994 1993 — Cash flows from operating activities: Operating loss ($41,635) ($27,340) — Adjustments to reconcile operating income (loss)to net cash flows from operating activities: — Changes in assets and liabilities: Decrease (increase) in due from other funds 109 105,958 Decrease (increase) in accounts receivable 22 (22) — Increase (decrease) in accounts payable 4,073 80 Increase (decrease) in compensated absences payable 5,752 (90,755) Increase (decrease) in payroll deductions payable 719 (3,040) Increase (decrease) in due to other funds 170,106 — Net cash flows from operating activities 139,146 (15,119) Cash flows from non-capital financing activities: Operating transfer to General Fund (200,000) (100,000) Cash flows from investing activities: Interest on investments 64,953 116,097 Net increase(decrease) in cash and cash equivalents 4,099 978 Cash and cash equivalents-January 1 978 — Cash and cash equivalents- December 31 $5,077 $978 122 Exhibit G-7 CITY OF FRIDLEY, MINNESOTA SELF INSURANCE INTERNAL SERVICE FUND COMPARATIVE BALANCE SHEET — December 31, 1994 and 1993 — 1994 1993 Assets Cash and cash equivalents $ $1,322,419 Investments 829,643 77,335 — Accounts receivable 209 Due from other funds 926,498 205,553 — Total assets $1,756,141 $1,605,516 — Liabilities and Fund Equity Current liabilities: — Accounts payable $877 $562 Total current liabilities 877 562 Fund equity: Contributed capital 1,000,000 1,000,000 — Retained earnings- Unreserved- Designated for future losses 755,264 604,954 Total fund equity 1,755,264 1,604,954 Total liabilities and fund equity $1,756,141 $1,605,516 123 - Exhibit G-8 CITY OF FRIDLEY, MINNESOTA SELF INSURANCE INTERNAL SERVICE FUND COMPARATIVE STATEMENT OF REVENUES, — EXPENSES AND CHANGES IN RETAINED EARNINGS Years Ended December 31, 1994 and 1993 1994 1993 Operating revenues: Insurance reimbursement $140,607 $107,501 — Total operating revenues 140,607 107,501 Operating expenses: Supplies and other charges 64,394 32,936 Total operating expenses 64,394 32,936 — Operating income 76,213 74,565 Non-operating expenses: Interest on investments 74,097 113,614 Net income 150,310 188,179 Retained earnings January 1 604,954 416,775 Retained earnings December 31 $755,264 $604,954 124 Exhibit G-9 CITY OF FRIDLEY, MINNESOTA SELF INSURANCE INTERNAL SERVICE FUND COMPARATIVE STATEMENT OF CASH FLOWS Years Ended December 31, 1994 and 1993 1994 1993 Cash flows from operating activities: Operating income $76,213 $74,565 Adjustments to reconcile operating income (loss)to net cash flows from operating activities: Changes in assets and liabilities: Decrease (increase) in due from other funds (720,945) 34,254 Decrease (increase) in accounts receivable 209 (209) Increase (decrease) in accounts payable 315 (16,220) Net cash flows from operating activities (644,208) 92,390 Cash flows from investing activities: Purchase of investment securities (752,308) (77,335) Interest on investments 74,097 113,614 Net cash flows from investing activities (678,211) 36,279 Net increase in cash and cash equivalents (1,322,419) 128,669 Cash and cash equivalents-January 1 1,322,419 1,193,750 Cash and cash equivalents- December 31 $0 $1,322,419 125 TRUST AND AGENCY FUNDS Trust and Agency Funds are used to account for assets held by a government in a trustee or agent capacity for individuals, private organizations, other governments or other funds. Expendable Trust Fund The City of Fridley maintains only one Expendable Trust Fund that is used to defray the City administrative costs associated with the issuance of industrial revenue development bonds. Six Cities Watershed Agency Fund This fund was established to account for the collection of taxes received from the County on behalf of the Six Cities Watershed District. Hotel/Motel Agency Fund This fund was established to account for the collection of a three percent tax that has been imposed on all the hotels and motels in the north suburban area. The collection process is administered by the City on behalf of the North Metro Convention and Tourism Bureau which will use the money to provide information to visitors and create an awareness of the facilities available in this area. Deferred Compensation Agency Fund This fund accounts for deposits held in trust with the International City Managers Association (ICMA) on behalf of the City of Fridley employees. Employees make pretax contributions to this organization throughout their careers which are used as a retirement benefit. HRA Deferred Compensation Agency Fund This fund accounts for deposits held in trust with the International City Managers Association (ICMA) on behalf of the Housing and Redevelopment Authority employees. Employees make pretax contributions to this organization throughout their careers which are used as a retirement benefit. Exhibit H-1 CITY OF FRIDLEY, MINNESOTA TRUST AND AGENCY FUNDS — COMBINING BALANCE SHEET December 31, 1994 With Comparative Totals for December 31, 1993 — Expendable Agency Totals — Trust Funds 1994 1993 Assets — Investments $53,580 $5,387 $58,967 $63,229 Receivables: — Accounts 3,019 3,019 2,701 Taxes- Unremitted 5 5 33 — Delinquent 418 418 623 Other assets 4,701,218 4,701,218 4,520,377 Total assets $53,580 $4,710,047 $4,763,627 $4,586,963 Liabilities and Fund Balance Liabilities: Accounts payable $ $ $ $491 Deposits payable 35,899 4,701,218 4,737,117 4,560,317 Due to other funds 103 103 Due to other governments 8,726 8,726 11,359 Total liabilities 35,899 4,710,047 4,745,946 4,572,167 Fund balance: _ Unreserved - undesignated 17,681 17,681 14,796 Total liabilities and fund balance $53,580 $4,710,047 $4,763,627 $4,586,963 — 128 Exhibit H-2 CITY OF FRIDLEY, MINNESOTA _ INDUSTRIAL DEVELOPMENT REVENUE BOND TRUST FUND COMPARATIVE STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE Years Ended December 31, 1994 and 1993 — 1994 1993 Revenues: Interest on investments $2,885 $4,802 Excess of revenues over expenditures 2,885 4,802 Increase of revenues over expenditures and other financing uses 2,885 4,802 Fund balance,January 1 14,796 9,994 — Fund balance, December 31 $17,681 $14,796 129 Exhibit H-3 CITY OF FRIDLEY, MINNESOTA ALL AGENCY FUNDS COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABILITIES (Continued) Year Ended December 31, 1994 Balance Balance January 1 Additions Deletions December 31 SIX CITIES WATERSHED AGENCY FUND Assets Investments $5,635 $3,343 $3,591 $5,387 Taxes receivable: Unremitted 33 5 33 5 Delinquent 623 205 418 Total assets $6,291 $3,348 $3,829 $5,810 Liabilities Due to other governments $6,291 $3,500 $3,981 $5,810 -- Total liabilities $6,291 $3,500 $3,981 $5,810 HOTEUMOTEL TAX AGENCY FUND -- Assets Investments $2,367 $41,799 $44,166 $ Accounts receivable 2,701 3,019 2,701 3,019 Total assets $5,068 $44,818 $46,867 _ $3,019 Liabilities Due to other funds $ $103 $ $103 Due to other governments 5,068 44,715 46,867 2,916 -- Total liabilities $5,068 $44,818 $46,867 $3,019 130 Exhibit H-3 Continued CITY OF FRIDLEY, MINNESOTA ALL AGENCY FUNDS COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABILITIES (Continued) Year Ended December 31, 1994 Balance Balance January 1 Additions Deletions December 31 DEFERRED COMPENSATION AGENCY FUND Assets Deferred compensation - at market $4,518,485 $412,148 $235,551 $4,695,082 Total assets $4,518,485 $412,148 $235,551 $4,695,082 Liabilities Deposits payable $4,518,485 $412,148 $235,551 $4,695,082 Total liabilities $4,518,485 $412,148 $235,551 $4,695,082 HRA DEFERRED COMPENSATION AGENCY FUND Assets _ Deferred compensation - at market $1,892 $4,330 $86 $6,136 Total assets $1,892 $4,330 $86 $6,136 Liabilities Deposits payable $1,892 $4,330 $86 $6,136 Total liabilities $1,892 $4,330 $86 $6,136 131 Exhibit H-3 Continued CITY OF FRIDLEY, MINNESOTA ALL AGENCY FUNDS — COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABILITIES (Continued) Year Ended December 31, 1994 Balance Balance January 1 Additions Deletions December 31 TOTALS-All AGENCY FUNDS Assets Investments $8,002 $45,142 $47,757 $5,387 Receivables: Accounts 2,701 3,019 2,701 3,019 Taxes- Unremitted 33 5 33 5 Delinquent 623 205 418 Other assets 4,520,377 416,478 235,637 4,701,218 — Total assets $4,531,736 $464,644 $286,333 $4,710,047 • Liabilities Deposits payable $4,520,377 $416,478 $235,637 $4,701,218 Due to other funds 103 103 Due to other governments 11,359 48,215 50,848 8,726 Total liabilities $4,531,736 $464,796 $286,485 $4,710,047 • 132 GENERAL FIXED ASSET ACCOUNT GROUP The General Fixed Asset Account Group is set up to account for long-lived assets not accounted for in an enterprise, trust or internal service fund. - Exhibit I-1 _ CITY OF FRIDLEY, MINNESOTA COMPARATIVE STATEMENT OF GENERAL FIXED ASSETS December 31, 1994 and 1993 1994 1993 General fixed assets: Land $2,484,913 $2,269,670 Building 4,882,041 4,773,786 Improvements other than building 15,942,628 18,322,067 Machinery and equipment 4,911,298 5,322,556 Construction in progress 1,307,914 Total general fixed assets $28,220,880 $31,995,993 Investment in general fixed assets from: General obligation bonds $856,597 $856,597 Federal and state aid 1,682,960 1,682,960 General fund revenues 10,167,201 10,694,521 Special revenue fund revenues 1,663,262 1,558,473 Special assessments 12,375,336 13,242,744 Private gifts 770,888 770,888 Other sources 704,636 3,189,810 Total investment in general fixed assets $28,220,880 $31,995,993 133 Exhibit 1-2 CITY OF FRIDLEY, MINNESOTA SCHEDULE OF CHANGES IN GENERAL FIXED ASSETS - BY FUNCTION AND ACTIVITY -• Year Ended December 31, 1994 General Fixed General Fixed Assets Assets 1/1/94 Additions Deletions 12/31/94 Function and Activity General government City manager $24,288 $19,336 $4,952 Cable TV 42,031 15,403 1,857 55,577 _ Accounting 44,240 13,527 30,713 Management information systems 570,486 555,441 15,045 Assessing 4,725 4,725 __ Elections 94,339 600 2,347 92,592 City clerk/records 3,185 700 2,485 Planning 146,851 3,847 1,649 149,049 Municipal center 3,724,338 4,433 3,728,771 Total general government 4,654,483 24,283 599,582 4,079,184 Public safety Public protection 715,815 95,851 72,969 738,697 Fire protection 1,555,090 187,509 15,276 1,727,323 Inspectional services 10,282 1,525 6,890 4,917 Civil defense 146,933 146,933 Total public safety 2,428,120 284,885 95,135 2,617,870 Public works Engineering 148,080 551 82,802 65,829 _ Street improvements 14,157,759 890,812 2,031,853 13,016,718 Traffic signal 219,415 219,415 City garage 2,067,606 117,313 4,103 2,180,816 Parks 5,616,792 281,970 1,236,539 4,662,223 Total public works 22,209,652 1,290,646 3,355,297 20,145,001 Recreation/Naturalist Recreation 166,989 8,246 24,491 150,744 Naturalist 1,228,835 6,377 7,131 1,228,081 __ Total recreation/naturalist 1,395,824 14,623 31,622 1,378,825 Construction in progress 1,307,914 1,307,914 -_ Total general fixed assets $31,995,993 $1,614,437 $5,389,550 $28,220,880 134 Exhibit 1-3 CITY OF FRIDLEY, MINNESOTA SCHEDULE OF GENERAL FIXED ASSETS BY FUNCTION AND ACTIVITY December 31, 1994 Improvements Machinery - Other than and Total Land Buildings Buildings Equipment - Function and Activity _ General government City manager $4,952 $ $ $ $4,952 Cable TV 55,577 55,577 Accounting 30,713 30,713 - Management information systems 15,045 15,045 Elections 92,592 92,592 City clerk/records 2,485 2,485 - Planning 149,049 124,804 24,245 Municipal center 3,728,771 53,948 2,849,206 44,377 781,240 Total general government 4,079,184 178,752 2,849,206 44,377 1,006,849 Public safety Public protection 738,697 166,871 571,826 Fire protection 1,727,323 58,656 504,212 111,205 1,053,250 Inspectional services 4,917 4,917 Civil defense 146,933 110,527 36,406 Total public safety 2,617,870 58,656 504,212 388,603 1,666,399 _ Public works Engineering 65,829 65,829 Street improvements 13,016,718 197,500 12,819,218 Traffic signal 219,415 214,537 4,878 City garage 2,180,816 142,940 386,266 239,888 1,411,722 Parks 4,662,223 1,601,007 691,041 1,796,446 573,729 Total public works 20,145,001 1,941,447 1,077,307 15,070,089 2,056,158 Recreation/Naturalist Recreation 150,744 13,542 137,202 Naturalist 1,228,081 306,058 451,316 426,017 44,690 Total recreation/naturalist 1,378,825 306,058 451,316 439,559 181,892 Total fixed assets $28,220,880 $2,484,913 $4,882,041 $15,942,628 $4,911,298 135 GENERAL LONG-TERM DEBT ACCOUNT GROUP The General Long-Term Debt Account Group is set up to account for unmatured principal of bonds, warrants, notes, or other forms of long-term indebtedness that are secured by the full faith and credit of the City and is not deemed the primary obligation of any specific enterprise fund of the City. Exhibit J-1 CITY OF FRIDLEY, MINNESOTA COMPARATIVE SCHEDULE OF GENERAL LONG-TERM DEBT December 31, 1994 and 1993 1994 1993 Amount available and to be provided for the payment of general long-term debt Amount available in Debt Service Funds $10,524,906 $12,838,703 Amount to be provided by future taxes 6,819,432 6,637,839 Total available and to be provided $17,344,338 $19,476,542 General long-term debt payable General long-term debt payable: General obligation special assessment improvement bonds $1,725,000 $3,575,000 General obligation tax increment refunding bonds 9,485,000 9,485,000 General obligation temporary tax increment bonds 4,030,000 4,030,000 Tax increment revenue refunding bonds 1,950,000 2,255,000 Capital lease payable 26,481 Construction loan payable 127,857 131,542 Total general long-term debt payable $17,344,338 $19,476,542 137 SUPPLEMENTAL SECTION Independent Auditors Report on Compliance With Specific Requirements Applicable to Nonmajor Federal Financial Assistance Program Transactions To the Honorable Mayor and Members of the City Council City of Fridley, Minnesota We have audited the general purpose financial statements of the City of Fridley,Minnesota as of and for the year ended December 31, 1994, and have issued our report thereon dated June 7, 1995. In connection with our audit of the general purpose financial statements of the City of Fridley, Minnesota, and with our consideration of the City of Fridley,Minnesota's control structure used to administer federal financial assistance programs,as required by Office of Management and Budget Circular A-128,Audits of State and Local Governments, we selected certain transactions applicable to certain nonmajor federal financial assistance programs for the year ended December 31, 1994. As required by OMB Circular A-128,we have performed auditing procedures to test compliance with the requirements governing the types of services, and special tests and provisions that are applicable to those transactions. Our procedures were substantially less in scope than an audit, the objective of which is the expression of an opinion on the City of Fridley, Minnesota's compliance with these requirements. Accordingly, we do not express such an opinion. With respect to the items tested,the results of those procedures disclosed no material instances of noncompliance with the requirements listed in the preceding paragraph. With respect to items not tested, nothing came to our attention that caused us to believe that the City of Fridley, Minnesota had not complied,in all material respects, with those requirements. Also, the results of our procedures did not disclose any immaterial instances of noncompliance with those requirements. This report is intended for the information of the City of Fridley, Minnesota and the Federal Cognizant Audit Agency. However, this report is a matter of public record and its distribution is not limited. ,, L/ 1;44es /Zolfo/A. 7€TAUTGES, REDPATH& CO., LTD. Certified Public Accountants June 7, 1995 139 Independent Auditor's Report on the Internal Control Structure in Accordance with Government Auditing Standards To the Honorable Mayor and — Members of the City Council City of Fridley, Minnesota We have audited the general purpose financial statements of the City of Fridley, Minnesota, as of and for the year ended December 31, 1994, and have issued our report thereon dated June 7, 1995. We conducted our audit in accordance with generally accepted auditing standards and Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement. In planning and performing our audit of the general purpose financial statements of the City of Fridley, Minnesota, for the year ended December 31, 1994, we considered its internal control structure in order to determine our auditing procedures for the purpose of expressing our opinion on the general purpose financial statements and not to provide assurance on the internal control structure. The management of the City of Fridley, Minnesota,is responsible for establishing and maintaining an internal control structure. In fulfilling this responsibility, estimates and judgments by management are required to assess the expected benefits and related costs of internal control structure policies and procedures. The objectives of an internal control structure are to provide management with reasonable, but not absolute, assurance that assets are safeguarded against loss from unauthorized use or disposition, and that transactions are executed in accordance with management's authorization and recorded properly to permit the preparation of general purpose financial statements in accordance with generally accepted accounting principles. Because of inherent limitations in any internal control structure,errors or irregularities may nevertheless occur and not be detected. Also,projections of any evaluation of the structure to future periods is subject to the risk that procedures may become inadequate because of changes in conditions or that the effectiveness of the design and operation of policies and procedures may deteriorate. — We obtained an understanding of the design of relevant policies and procedures and whether they have been placed in operation, and we assessed control risk. We also performed tests of controls to evaluate the effectiveness of the design and operation of internal control structure policies and procedures that we considered relevant to preventing and detecting irregularities that are material to the general purpose financial statements, and to preventing misstatements resulting from illegal acts and other noncompliance matters that have a direct and material effect on the general purpose financial statements. Our tests were less in scope than would be necessary to render an opinion on internal control structure policy and procedures. Accordingly, we do not express such an opinion. 141 Our consideration of the internal control structure would not necessarily disclose all matters in the internal control structure that might be material weaknesses under standards established by the American Institute of Certified Public Accountants. A material weakness is a condition in which the design or operation of one or more of the internal control structure elements does not reduce to a relatively low level the risk that errors and irregularities in amounts that would be material in relation to the general purpose financial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. We noted no matters involving the internal control structure and its operations that we consider to be material weaknesses as defined above. This report is intended for the information of the City of Fridley, Minnesota and the Federal Cognizant Audit Agency. This restriction is not intended to limit the distribution of this report, which is a matter of public record. sf,44.€4 ge,-/hfaZ -14. xkf. TAUTGES, REDPATH& CO., LTD. Certified Public Accountants June 7, 1995 143 • Independent Auditor's Report on the Internal Control Structure Used in Administering Federal Financial Assistance Programs To the Honorable Mayor and Members of the City Council City of Fridley, Minnesota We have audited the general purpose financial statements of the City of Fridley, Minnesota, as of and for the year ended December 31, 1994, and have issued our report thereon dated June 7, 1995. We conducted our audit in accordance with generally accepted auditing standards; Government Auditing Standards,issued by the Comptroller General of the United States; and Office of Management and Budget Circular A-128,Audits of State and Local Governments. Those standards and OMB Circular A-128 require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement. In planning and performing our audits for the year ended December 31, 1994, we considered the internal control structure of the City of Fridley, Minnesota in order to determine our auditing procedures for the purpose of expressing our opinion on the general purpose financial statements of the City of Fridley, Minnesota and to report on the internal control structure in accordance with OMB Circular A-128. This report addresses our consideration of internal control structure policies and procedures relevant to compliance with requirements applicable to federal financial assistance programs. We have addressed internal control structure policies and procedures relevant to our audit of the general purpose financial statements in a separate report dated June 7, 1995. The management of the City of Fridley,Minnesota is responsible for establishing and maintaining an internal control structure. In fulfilling this responsibility,estimates and judgments by management are required to assess the expected benefits and related costs of internal control structure policies and procedures. The objectives of an internal control structure are to provide management with reasonable, but not absolute, assurance that assets are safeguarded against loss from unauthorized use or disposition, that transactions are executed in accordance with management's authorization and recorded properly to permit the preparation of general purpose financial statements in accordance with generally accepted accounting principles, and that federal financial assistance programs are managed in compliance with applicable laws and regulations. Because of inherent limitations in any internal control structure, errors, irregularities, or instances — of noncompliance may nevertheless occur and not be detected. Also,projection of any evaluation of the structure to future periods is subject to the risk that procedures may become inadequate because of changes in conditions or that the effectiveness of the design and operation of policies and procedures may deteriorate. 145 For the purpose of this report, we have classified the significant internal control structure policies and procedures used in administering federal financial assistance programs in the following categories: General Requirements: Accounting applications: Political Activity Receivables Civil Rights Cash disbursements — Cash Management Allowable Costs/Cost Principles Administrative Requirements For all of the internal control structure categories listed above, we obtained an understanding of the design of relevant policies and procedures and determined whether they have been placed in operation, and we assessed control risk. During the year ended December 31, 1994, the City of Fridley, Minnesota had no major federal financial assistance programs and expended 87.76% of its total federal financial assistance under the Community Development Block Grant Program. We performed tests of controls, as required by OMB Circular A-128, to evaluate the effectiveness — of the design and operation of internal control structure policies and procedures that we considered relevant to preventing or detecting material noncompliance with specific requirements, general requirements, and requirements governing claims for advances and reimbursements and amounts claimed or used for matching that are applicable to the aforementioned nonmajor programs. Our procedures were less in scope than would be necessary to render an opinion on these internal control structure policies and procedures. Accordingly, we do not express such an opinion. Our consideration of the internal control structure policies and procedures used in administering federal financial assistance would not necessarily disclose all matters in the internal control structure that might constitute material weaknesses under standards established by the American Institute of Certified Public Accountants. A material weakness is a reportable condition in which the design or operation of one or more of the internal control structure elements does not reduce to a relatively low level the risk that noncompliance with laws and regulations that would be material to a federal financial assistance program may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. We noted no matters involving the internal control structure and its operations that we consider to be material weaknesses as defined above. This report is intended for the information of the City of Fridley, Minnesota and the Federal Cognizant Audit Agency. This restriction is not intended to limit the distribution of this report, which is a matter of public record. TAUTGES, REDPATH& CO., LTD. Certified Public Accountants June 7, 1995 147 Independent Auditor's Report on Compliance With General Requirements Applicable to Federal Financial Assistance Programs To the Honorable Mayor and Members of the City Council City of Fridley, Minnesota We have audited the general purpose financial statements of the City of Fridley, Minnesota, as of and for the year ended December 31, 1994, and have issued our report thereon dated June 7, 1995. We have applied procedures to test the City of Fridley, Minnesota's compliance with the following requirements applicable to its federal financial assistance programs, which are identified in the Schedule of Federal Financial Assistance,for the year ended December 31, 1994. The general requirements tested were: _ Political Activity Allowable Costs/Cost Principles Civil Rights Administrative Requirements Cash Management Our procedures were limited to the applicable procedures described in the Office of Management and Budget's Compliance Supplement for Single Audits of State and Local Governments. Our procedures were substantially less in scope than an audit, the objective of which is the expression of an opinion on the City of Fridley, Minnesota's compliance with the requirements listed in the preceding paragraph. Accordingly, we do not express such an opinion. With respect to the items tested, the results of those procedures disclosed no material instances of noncompliance with the requirements listed in the second paragraph of this report. With respect to items not tested,nothing came to our attention that caused us to believe that the City of Fridley, Minnesota had not complied, in all material respects, with those requirements. Also, the results of our procedures did not disclose any immaterial instances of noncompliance with those requirements. This report is intended for the information of the City of Fridley, Minnesota and the Federal Cognizant Audit Agency. However, this report is a matter of public record and its distribution is not limited. Aggihogit. 4, /44 TAUTGES, REDPATH& CO.,LTD. Certified Public Accountants June 7, 1995 149 Independent Auditor's Report on Supplementary Schedule of Federal Financial Assistance To the Honorable Mayor and Members of the City Council City of Fridley, Minnesota We have audited the general purpose financial statements of the City of Fridley, Minnesota, as of and for the year ended December 31, 1994, and have issued our report thereon dated June 7, 1995. These general purpose financial statements are the responsibility of the City of Fridley, Minnesota's management. Our responsibility is to express an opinion on these general purpose financial statements based on our audit. We conducted our audit in accordance with generally accepted auditing standards and Government Auditing Standards, issued by the Comptroller General of the United States and the provisions of Office of Management and Budget Circular A-128,Audits of State and Local Governments. Those standards and OMB Circular A-128 require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the general purpose financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall general purpose financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. Our audit was conducted for the purpose of forming an opinion on the general purpose financial statements of the City of Fridley, Minnesota, taken as a whole. The accompanying Schedule of Federal Financial Assistance is presented for purposes of additional analysis and is not a required part of the general purpose financial statements. The information in that Schedule has been subjected to the auditing procedures applied in the audit of the general purpose financial statements and, in our opinion,is fairly presented in all material respects in relation to the general purpose — financial statements taken as a whole. TAUTGES, REDPATH& CO., LTD. Certified Public Accountants June 7, 1995 151 Compliance Report Based on an Audit of General Purpose Financial Statements Performed in Accordance with Government Auditing Standards To the Honorable Mayor and Members of the City Council City of Fridley, Minnesota We have audited the general purpose financial statements of the City of Fridley, Minnesota, as of and for the year ended December 31, 1994 and have issued our report thereon dated June 7, 1995. We conducted our audit in accordance with generally accepted auditing standards and Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement. Compliance with laws,regulations,contracts, and grants applicable to the City of Fridley, Minnesota, is the responsibility of the City of Fridley,Minnesota's management. As part of obtaining reasonable assurance about whether the general purpose financial statements are free of material misstatement, we performed tests of the City of Fridley, Minnesota's compliance with certain provisions of laws, regulations,contracts, and grants. However, the objective of our audit of the general purpose financial statements was not to provide an opinion on overall compliance with such provisions. Accordingly, we do not express such an opinion. Reportable noncompliance findings consist of irregularities and illegal acts that are not clearly inconsequential and instances of other noncompliance that are material to the financial statements. Irregularities are intentional misstatements or omissions of amounts or disclosures in financial statements. Illegal acts are violations of laws and regulations. Instances of other noncompliance include failures to follow requirements or violations of prohibitions contained in contracts or grant agreements that cause us to conclude that the aggregation of the misstatements resulting from those failures or violations is material to the financial statements. The results of our tests of compliance disclosed no reportable noncompliance findings. This report is intended solely for the information of the City of Fridley, Minnesota and the Federal Cognizant Audit Agency. This restriction is not intended to limit the distribution of this report, which is a matter of public record. Respectfully submitted, TAUTGES, REDPATH& CO., LTD. Certified Public Accountants June 7, 1995 153 Exhibit K-1 CITY OF FRIDLEY, MINNESOTA SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE For The Year Ended December 31, 1994 Accrued Catalog# Accrued (Deferred) Federal Funding Source/ Federal Revenue at Revenue at Pass Through Agency/ Domestic January 1, Revenue December 31 Program Title Assistance 1994 Recognized Expenditures 1994 U.S. Department of Housing and Urban Development: Anoka County: Community Development Block Grant- Entitlement Grant 14.219 $13,885 $60,299 $60,299 $38,789 Home Investment Partnership Program 14.239 203,312 203,312 120,192 13,885 263,611 263,611 158,981 Metropolitan Council Housing and Redevelopment Authority: Housing Assistance Payments Program for Low Income Families 14.156 8,429 43,332 36,755 Total Department of Housing and Urban Development 22,314 306,943 300,366 158,981 U.S. Department of Health and _ Human Services: Greater Minneapolis Council of Churches: Special Programs for the Aging - Title III, Part C - Nutrition Services 13.635 713 8,918 8,918 692 Federal Emergency Management _ Association: Minnesota Department of Public Safety: Civil Defense 83.516 1,059 4,206 4,206 Total Federal Assistance $24,086 $320,067 $313,490 $159,673 155 Exhibit K-2 CITY OF FRIDLEY, MINNESOTA SCHEDULE OF ASSESSED VALUATION AND LONG-TERM DEBT FOR THE TAX INCREMENT FINANCING DISTRICT '- DECEMBER 31, 1994 Redevelopment District Original Tax Capacity $1,721,715 Current Tax Capacity 4,303,202 Captured Tax Capacity- retained by the Authority 2,581,487 Bonds Issues: General Obligation Tax Increment Bonds of 1981 $2,200,000 General Obligation Tax Increment Bonds of 1982 625,000 General Obligation Tax Increment Bonds of 1983 600,000 Tax Increment Revenue Refunding Bonds of 1985 4,070,000 General Obligation Tax Increment Redevelopment Bonds of 1985 11,550,000 General Obligation Tax Increment Refunding Bonds of 1986 10,045,000 General Obligation Tax Increment Refunding Bonds of 1990 9,485,000 General Obligation Temporary Tax Increment Bonds of 1992, Series 1992C 4,030,000 Total bonds issued 42,605,000 Amounts Redeemed: Paid (3,860,000) Bonds defeased - prior (23,280,000) Total amount redeemed (27,140,000) Outstanding bonds at December 31, 1994 $15,465,000 156 Exhibit K-3 — CITY OF FRIDLEY, MINNESOTA SCHEDULE OF SOURCES AND USES OF PUBLIC FUNDS FOR THE TAX INCREMENT FINANCING DISTRICT INCEPTION TO DECEMBER 31, 1994 — Current Year Prior Years Total Sources of Funds: — Proceeds of bond sale $ $44,226,128 $44,226,128 Tax increments received 2,734,021 18,715,499 21,449,520 Special assessments 86,268 287,707 373,975 — Interest on invested funds 502,927 5,609,862 6,112,789 Real estate sales 536,334 536,334 Rental 43,165 620,284 663,449 — Home ownership revenue 10,125 10,125 Other 4,703 311,939 316,642 Total sources of funds 3,371,084 70,317,878 73,688,962 Uses of Funds: Land acquisition 445,932 15,807,839 16,253,771 — Building acquisition 12,411 1,262,440 1,274,851 Site improvements or preparation costs 287,115 3,140,015 3,427,130 — Installation of public utilities and improvements 1,096,775 1,096,775 Bond payments — Principal 305,000 14,485,000 14,790,000 Interest and fiscal charges 987,298 8,760,509 9,747,807 Payment to refunded bond escrow agent 9,257,980 9,257,980 — Refund to school districts 296,246 1,499,105 1,795,351 Administrative costs 515,022 3,925,254 4,440,276 Other 138,653 724,088 862,741 Total uses of funds 2,987,677 59,959,005 62,946,682 District Balance $383,407 $10,358,873 $10,742,280 157 STATISTICAL SECTION Table 1 CITY OF FRIDLEY, MINNESOTA GENERAL GOVERNMENT EXPENDITURES BY FUNCTION (1) LAST TEN FISCAL YEARS Fiscal General Public Municipal Public Community Recreation, Debt Year Government Safety Center Works Development(2) Naturalist Service Total 1985 $985,091 $2,270,691 $162,220 $2,212,406 $ $535,801 $768,547 $6,934,756 — 1986 1,877,676 2,576,847 180,839 1,886,888 535,430 1,515,823 8,573,503 1987 1,927,147 2,707,681 160,222 1,992,949 530,066 2,248,809 9,566,874 1988 2,366,779 2,741,465 205,654 2,014,957 589,771 2,803,027 10,721,653 — 1989 2,013,513 3,030,507 273,095 2,222,203 628,397 3,181,419 11,349,134 1990 2,470,439 3,008,700 173,260 2,592,638 641,432 15,789,169 24,675,638 1991 2,566,435 3,233,501 165,968 2,213,994 422,381 655,985 1,866,305 11,124,569 1992 2,857,536 3,320,123 172,06664 2,306,970 378,690 702,421 1,884,325 11,622,729 — 1993 2,612,941 3,413,297 169,493 2,376,990 407,470 720,759 2,207,891 11,908,841 1994 3,206,942 3,552,812 180,104 2,473,128 462,615 780,242 3,495,789 14,151,632 — Notes (1) Includes General, Special Revenue, Capital Projects and Debt Service Funds and excludes capital outlay. (2) Prior to 1991, Community Development was included with Public Works. 159 Table 2 — CITY OF FRIDLEY GENERAL REVENUE BY SOURCE(1) LAST TEN FISCAL YEARS General Property Taxes& Intergovern- — Fiscal Special Licenses mental Charges For Miscellaneous Year Assessments &Permits Revenue Services Revenue Total — 1985 $4,269,937 $422,606 $3,402,703 $153,483 $2,506,575 $10,755,304 1986 4,885,669 358,962 3,652,179 157,829 3,571,207 12,625,846 1987 4,767,980 405,583 3,302,438 164,617 3,086,280 11,726,898 — 1988 5,296,520 378,553 3,744,038 160,255 2,938,911 12,518,277 1989 7,353,139 477,192 4,968,720 158,663 2,682,242 15,639,956 1990 6,900,089 408,966 3,564,426 630,015 2,570,467 14,073,963 _ 1991 7,301,508 425,023 3,445,972 784,962 3,031,408 14,988,873 1992 7,336,538 401,178 4,538,566 842,590 3,027,293 16,146,165 1993 7,521,395 410,135 4,417,835 928,736 3,619,903 16,898,004 — 1994 6,915,475 528,111 3,808,828 1,038,863 2,393,463 14,684,740 Note _ (1) Includes General, Special Revenue, Capital Projects and Debt Service Funds. 160 Table 3 _ CITY OF FRIDLEY, MINNESOTA CERTIFIED PROPERTY TAX LEVIES AND COLLECTIONS LAST TEN FISCAL YEARS — Ratio Current Percent Collection of Total Outstanding Fiscal Certified Tax of Levy of Prior Total Collections Delinquent — Year Tax levy Collections(1X2) Collected Year's Taxes Collections to Tax Levy Taxes 1985 $3,178,325 $3,072,588 96.67% $76,894 $3,149,482 .9909:1 $150,983 — 1986 3,232,877 3,152,249 97.51% 44,094 3,196,343 .9887:1 180,738 1987 3,406,825 3,253,858 95.51% 49,299 3,303,157 .9696:1 284,407 1988 3,440,107 3,373,355 98.06% 106,318 3,479,673 1.0115:1 244,842 — 1989 3,652,452 3,574,837 97.87% 36,610 3,611,447 .9888:1 285,847 1990 4,512,647 4,393,986 97.37% 64,357 4,458,343 .9880:1 300,854 1991 4,751,465 4,620,032 97.23% 12,633 4,632,665 .9750:1 320,081 — 1992 4,751,465 4,575,242 96.29% 36,480 4,611,722 .9706:1 399,739 1993 4,626,465 4,563,742 98.64% 162,911 4,726,653 1.0019:1 217,536 1994 3,678,665 3,578,604 97.28% 6,764 3,585,368 .9746:1 32,416 (3) Notes (1) For years prior to 1994, the tax levy and collections include Homestead and Agricultural — Aid Credit(HACA). Beginning in 1994, state law required the City to certify its tax levy after subtracting HACA. Total HACA received in 1994 was$1,072,800. — (2) Excludes collections from properties pledged to tax increment. (3) Taxes were adjusted$229,213 by Anoka County due to abatements, court — ordered settlements and corrections of prior errors by the County. See Footnote 1.F.2. 161 CITY OF FRIDLEY, MINNESOTA ESTIMATED MARKET VALUE AND TAXABLE VALUE OF ALL PROPERTY — LAST TEN FISCAL YEARS Fiscal Year Payable 1985 1986 1987 1988 Assessment Year 1984 1985 1986 1987 — Population, fiscal year 29,440 29,423 29,310 29,336 Real Property: — Estimated market value $807,910,500 $839,392,000 $879,498,600 $907,274,900 Taxable value - — Homestead $91,923,166 $91,343,841 $94,010,922 $94,216,387 Excess and non-homestead 132,234,317 143,450,918 153,262,018 152,658,373 Less fiscal disparities contribution (29,835,444) (29,730,694) (34,112,779) (37,235,245) — Less tax increment value (5,458,497) (9,032,222) (11,348,839) (14,921,389) Taxable value $188,863,542 $196,031,843 $201,811,322 $194,718,126 — Personal property: Estimated market value $21,534,300 $26,208,700 $26,531,000 $26,731,000 Taxable value $9,259,749 $11,245,936 $11,393,525 $11,479,525 Totals: Estimated market value $829,444,800 $865,600,700 $906,029,600 $934,005,900 — Taxable value $198,123,291 $207,277,779 $213,204,847 $206,197,651 Per market value ratios Taxable value .239:1 .239:1 .235:1 .221:1 Per capita valuations Estimated market value $28,174 $29,419 $30,912 $31,838 Taxable value $6,730 $7,045 $7,274 $7,029 Real property — Taxable value - Fiscal disparities distribution $18,142,244 $18,296,235 $20,639,055 $23,382,622 Notes (1) The Minnesota Legislature enacted legislation which changed the method of — computing property taxes in 1988, 1989 and 1990. Those changes have been reflected in the computation of the taxable value for taxes payable in 1988 thru 1994. (2) The Anoka County Auditor's Office determines taxable values on January 2 of each year pursuant to State Statutes. The Total Taxable Value on January 2, 1993 upon which the 1994 levy was based was$19,747,532. — (3) The 1994 polulation estimate from Metropolitan Council was not available. 162 Table 4 1989 1990 1991 1992 1993 1994 1988 (1) 1989 (1) 1990 (1) 1991 (1) 1992(1) 1993(1) (3) 29,250 28,335 28,313 28,369 28,287 28,287 $941,136,600 $998,231,500 $1,002,812,900 $1,057,532,000 $1,064,099,200 $1,068,474,200 $11,864,707 $6,858,848 $7,009,982 $6,763,333 $6,980,161 $7,008,373 19,425,676 19,728,534 20,147,442 20,555,478 19,609,068 19,250,219 (4,351,931) (4,435,055) (4,853,513) (4,684,322) (5,274,175) (5,000,902) (2,524,911) (2,368,717) (2,840,385) (3,073,122) (2,536,327) (2,581,487) $24,413,541 $19,783,610 $19,463,526 $19,561,367 $18,778,727 $18,676,203 - $26,452,800 $27,116,700 $27,606,700 $22,917,200 $23,184,800 $23,308,700 $1,385,766 $1,369,388 $1,115,388 $1,087,658 $1,088,969 $1,071,329 $967,589,400 $1,025,348,200 $1,030,419,600 $1,080,449,200 $1,087,284,000 $1,091,782,900 $25,799,307 $21,152,998 $20,578,914 $20,649,025 $19,867,696 $19,747,532 .027:1 .021:1 .020:1 .019:1 .018:1 .018:1 $33,079 $36,187 $36,393 $38,086 $38,438 $38,597 $882 $747 $727 $728 $702 $698 $3,428,008 $3,817,118 $4,079,539 $3,753,494 $3,463,663 $3,349,769 163 CITY OF FRIDLEY, MINNESOTA SIGNIFICANT MINNESOTA TAX POLICIES — DECEMBER 31, 1994 GENERAL All non-exempt property in Minnesota is subject to taxation by local taxing districts. The tax levied on — a property is determined by computing its tax capacity, which is the property's market value multiplied by the appropriate class rate. The taxes on a property are computed by multiplying the tax rate by the property's tax capacity. The tax rate is determined by the County Auditor, dividing each tax levy by the taxing jurisdiction's adjusted net tax capacity. — Properties are physically reviewed by assessors at least once every four years. The assessors market value is multiplied by the appropriate class rates to arrive at the adjusted net tax capacity (taxable value). The class rates vary by class of property. Type of Property 1994 Class Rates Residential Homestead First $72,000 1.00% _ Over $72,000 2.00 Commercial/Industrial First $100,000 3.00 Over $100,000 4.70 Rentals Apartments: 4+ units 3.40 Less than 4 units 2.50 — Title II, MFHA, Sect. 8 2.30 Property Tax Refund. Residential property tax credits are indexed by the percentage of net property — tax to household income to the extent a homeowners property tax exceeds a percentage of household income. This percentage ranges from 1.2%for incomes below$1,000 up to 4%for incomes of$61,930. The maximum refund is $440. In 1989 the Minnesota Legislature also enacted a targeting property tax credit program. This program provides refunds to homestead property owners for part of their tax increase in excess of 12 percent, if the increase is at least $300. The refund is equal to 75 percent of the increase over 12%. The — maximum refund is $1,500. 164 CITY OF FRIDLEY, MINNESOTA PROPERTY TAX RATES AND CALCULATED TAX LEVIES ALL OVERLAPPING GOVERNMENTS LAST TEN FISCAL YEARS Property Tax Rates(1) School School School School - Fiscal District District District District Year City No. 11 No. 13 No. 14 No. 16 (2) County 1985 14.894 52.830 50.487 59.675 60.914 27.017 1986 14.330 55.740 53.797 60.919 63.878 28.738 1987 14.630 54.926 63.234 57.087 60.989 29.414 - 1988 15.058 62.181 60.733 67.454 70.880 30.766 1989 12.544% 51.384% 51.364% 55.193% 53.212% 27.425% 1990 15.010% 47.893% 41.329% 43.158% 43.334% 28.846% - 1991 15.854% 51.779% 53.249% 49.727% 49.867% 31.400% 1992 15.474% 56.525% 61.847% 58.025% 49.798% 32.990% 1993 15.390% 63.717% 68.142% 61.406% 58.922% 32.779% - 1994 16.005% 57.161% 69.161% 60.840% 53.355% 32.680% Certified Levies Calculated Tax Levies School School School School Fiscal District District District District Year City No. 11 No. 13 No. 14 No. 16 (2) County - 1985 $3,163,427 $536,388 $2,650,406 $6,152,690 $3,122,134 $5,825,992 1986 3,232,877 576,032 2,894,115 6,402,200 3,555,419 6,451,056 - 1987 3,406,825 585,299 3,522,818 6,298,305 3,500,364 6,864,334 1988 3,440,107 647,200 3,599,278 7,437,847 3,817,013 7,031,655 1989 3,652,452 708,533 3,692,407 7,836,416 3,448,538 7,939,936 - 1990 4,509,208 566,098 2,930,508 5,953,244 3,097,572 9,883,766 1991 4,751,465 586,640 3,353,377 6,279,991 3,477,136 9,717,317 1992 4,751,465 627,737 3,778,068 6,979,677 3,813,412 9,308,025 - 1993 4,626,465 707,974 4,017,763 7,284,693 4,232,967 9,620,566 1994 3,678,665 601,518 3,320,595 6,553,910 3,608,345 7,828,549 Notes (1) 1985-1988 tax rates are expressed as mills; 1989-1994 rate is expressed as a - tax capacity rate. (2) Vocational/Technical District#916 is included in District No. 16. - (3) Six Cities Watershed District is included with School District No. 11 beginning in 1985. (4) Rice Creek Watershed District is included with School District No. 13,14 and 16. - (5) The 1994 State Legislature required all entities to certify tax levies after subtracting Homestead and Agricultural Aid Credit(HACA). N/A- Comparison with past years is not applicable due to the change discussed in Note 5. 166 Table 5 Totals Total School School School School Special District District District District Districts No. 11 (3) No. 13 (4) No. 14(4) No. 16 (2),(4) 5.229 99.480 97.257 106.445 107.684 4.956 103.502 101.673 108.795 111.754 5.761 104.299 112.889 106.742 110.644 5.531 113.334 112.022 118.743 122.169 4.679% 95.813% 95.908% 99.737% 97.756% 4.399% 95.851% 89.554% 91.383% 92.498% 4.767% 103.420% 105.226% 101.704% 101.844% - 5.119% 109.711% 115.388% 111.566% 103.339% 5.668% 116.910% 122.707% 115.221% 114.723% - 5.452% 110.879% 123.277% 114.956% 108.899% Net Total Total Yearly Contribution Tax Total Special All Local Percentage To Metro Increment Tax Districts Tax Levies Change Tax Pool Districts Levies $1,073,929 $22,524,966 (2.02)% $1,343,511 $573,946 $24,442,423 1,080,737 24,192,436 7.40% 1,298,052 867,372 26,357,860 1,269,417 25,447,362 5.19% 1,608,958 993,610 28,049,930 1,246,009 27,219,109 6.96% 1,799,575 1,530,798 30,549,482 1,321,824 28,600,106 5.07% 91,973 2,357,865 31,049,944 1,442,262 28,382,658 (.08)% 92,659 2,510,294 30,985,611 1,426,691 29,592,617 4.26% 122,535 2,662,381 32,377,533 1,497,874 30,756,258 3.93% 143,841 3,146,849 34,046,948 1,564,535 32,054,963 4.22% 278,637 3,165,008 35,498,608 1,223,738 26,815,320 N/A 264,264 2,885,143 29,964,727 167 Table 6 CITY OF FRIDLEY, MINNESOTA SPECIAL ASSESSMENT LEVIES AND COLLECTIONS LAST TEN FISCAL YEARS Total Current Current Collections Delinquent Collections Outstanding Fiscal Assessments Assessments to Amount Assessments Total to Current Delinquent Year Due Collected Due Collected Collected Assessment Assessments 1985 $893,674 $802,910 89.84% $133,182 $936,092 104.75% $344,254 1986 765,737 730,149 95.35% 143,891 874,040 114.14% 176,879 1987 917,525 845,716 92.17% 30,524 876,240 95.50% 221,994 1988 782,079 779,413 99.66% 41,719 821,132 104.99% 202,296 1989 743,555 706,442 95.01% 52,374 758,816 102.05% 168,014 1990 604,960 577,064 95.39% 41,913 618,977 102.32% 151,658 1991 737,712 652,011 88.38% 28,616 680,627 92.26% 215,764 1992 636,842 573,413 90.04% 68,982 642,395 100.87% 126,221 1993 603,004 553,927 91.86% 68,367 622,294 103.20% 91,010 1994 581,591 536,450 92.24% 31,201 567,651 97.60% 118,994 168 CITY OF FRIDLEY, MINNESOTA HISTORY OF CERTIFIED TAX LEVIES AND TAX RATES LAST TEN FISCAL YEARS — 1985 1986 1987 1988 — Certified tax levies General Fund $3,083,270 $3,141,859 $3,311,826 $3,345,1 90 — General Debt Service Funds 35,175 35,628 Capital Improvement Fund 44,982 45,521 85,542 86,320 Subtotal 3,163,427 3,223,008 3,397,368 3,431,510 — Agency Fund 14,898 9,869 9,457 8,597 Total $3,178,325 $3,232,877 $3,406,825 $3,440,107 Mill rate (1985-1988); Tax Capacity Rate (1989-1994) — General Fund 14.283 13.895 14.188 14.614 General Debt Service Funds 0.163 0.158 Capital Improvement Fund 0.208 0.203 0.367 0.378 — Subtotal 14.654 14.256 14.555 14.992 Agency Fund 0.240 0.074 0.075 0.066 — Total 14.894 14.330 14.630 15.058 Notes (1) In 1994, the State law required the City to certify its tax levy after subtracting — Homestead and Agricultural Aid Credit(HACA). Total HACA for 1994 was$1,072,800. 170 Table 7 1989 1990 1991 1992 1993 1994 (1) $3,556,166 $4,421,519 $4,660,276 $4,660,276 $4,535,276 $3,603,266 87,689 87,689 87,689 87,689 87,689 72,689 3,643,855 4,509,208 4,747,965 4,747,965 4,622,965 3,675,955 8,597 3,439 3,500 3,500 3,500 2,710 $3,652,452 $4,512,647 $4,751,465 $4,751,465 $4,626,465 $3,678,665 - 12.192% 14.705% 15.548% 15.153% 15.076% 15.690% 0.300% 0.290% 0.284% 0.300% 0.314% 0.315% - 12.492% 14.995% 15.832% 15.453% 15.390% 16.005% 0.052% 0.015% 0.022% 0.021% 0.022% 0.021% 12.544% 15.010% 15.854% 15.474% 15.412% 16.026% 171 CITY OF FRIDLEY, MINNESOTA RATIO OF NET GENERAL BONDED DEBT TO TAXABLE VALUE AND NET BONDED DEBT PER CAPITA _ LAST TEN FISCAL YEARS Deduct City Debt Special Total Service Fund Assessment, _ Fiscal Taxable Gross Monies Revenue and Year Population Value Bonded Debt Available HRA Bonds 1985 29,440 $198,123,291 $22,125,000 $86,117 $22,090,000 1986 29,423 207,277,779 34,035,000 91,510 34,035,000 1987 29,310 213,204,847 33,195,000 -0- 33,195,000 1988 29,336 206,197,651 31,845,000 -0- 31,845,000 1989 29,250 25,799,307 (1) 30,060,000 -0- 30,060,000 1990 28,335 21,152,998 (1) 15,765,000 -0- 15,765,000 _ 1991 28,313 20,578,914 (1) 17,715,000 -0- 17,715,000 1992 28,369 20,649,025 (1) 22,470,000 -0- 22,470,000 1993 28,287 19,867,696 (1) 21,500,000 -0- 21,500,000 _ 1994 28,287 (2) 19,747,532 (1) 19,600,000 -0- 19,600,000 Notes (1)The Minnesota Legislature enacted legislation in 1988 and 1989 which changed the method of computing property taxes. Those changes have been reflected in the computation of the taxable value for taxes payable in 1989 - 1994. _ (2)The 1994 population estimate from Metropolitan Council was not available. 172 Table 8 Ratio of Net General Bonded Net General Net General Debt to Total Bonded Debt Bonded Debt Taxable Value Per Capita -0- - - -0- - - -0- - - -0- - - -0- - - -0- - - -0- - - -0- - - -0- - - -0- - - 173 Table 9 CITY OF FRIDLEY, MINNESOTA COMPUTATION OF LEGAL DEBT MARGIN DECEMBER 31, 1994 Market Value $1,091,782,900 (A) Debt Limit 2% of Market Value $21,835,658 Amount of Debt Applicable to Debt Limit: Total Debt $19,727,857 (B) Deductions: Tax Increment Redevelopment Bonds $15,465,000 Special Assessment Bonds 1,725,000 — Revenue Bonds 2,410,000 Construction Loan 127,857 19,727,857 Total Amount of Debt Applicable to Debt Limit -0- Legal Debt Margin $21,835,658 Notes (A) M.S.A. Section 475.53 (see following page) (B) M.S.A. Section 475.51 (see following page) — 174 CITY OF FRIDLEY, MINNESOTA COMPUTATION OF LEGAL DEBT MARGIN (CONTINUED) YEAR ENDED DECEMBER 31, 1994 Note (A): M.S.A. Section 475.53 et seq. Limit on Net Debt 'Subdivision 1. Generally, except as otherwise provided in sections 475.51 to 475.75, no municipality, except a school district or a city of the first class, shall incur or be subject to a net debt in excess of two percent of the market value of taxable property in the municipality.' Note (B): M.S.A. Section 475.51 Definitions 'Subdivision 4. 'Net Debt' means the amount remaining after deducting from its gross debt the amount of current revenues which are applicable within the current fiscal year to the payment of any debt, and the aggregate of the principal of the following: (1) Obligations issued for improvements which are payable wholly or partly from the proceeds of special assessments levied upon property specially benefited thereby, including those which are general obligations of the municipality issuing them, if the municipality is entitled to reimbursement in whole or in part from the proceeds of the special assessments. (2) Warrants or orders having no definite or fixed maturity. (3) Obligations payable wholly from the income from revenue producing conveniences. (4) Obligations issued to create or maintain a permanent improvement revolving fund. (5) Obligations issued for the acquisition and betterment of public waterworks systems, public lighting, heating or power systems, and any combination thereof, or for any other public convenience from which a revenue is or may be derived. (6) Debt service loans and capital loans made to a school district under the provisions of sections 124.42 and 124.431. (7) Amount of all money and the face value of all securities held as a debt service fund for the extinguishment of obligations other than those deductible under this subdivision. (8) Obligations to repay loans made under section 216C.37. (9) Obligations to repay loans made from money received from litigation or settlement of alleged violations of federal petroleum pricing regulations. (10) All other obligations which under the provisions of law authorizing their issuance are not to be included in computing the net debt of the municipality.' 175 Table 10 CITY OF FRIDLEY, MINNESOTA COMPUTATION OF DIRECT AND OVERLAPPING BONDED DEBT AND COMPARATIVE DEBT RATIOS — DECEMBER 31, 1994 Debt % of Debt Net Debt Gross Service Net Applicable Applicable Governmental Unit Debt Funds Debt to City to City — Direct and overlapping debt Direct debt: City of Fridley $19,600,000 $10,524,906 $9,075,094 100.00% $9,075,094 Overlapping debt: School Districts No. 11 120,142,792 38,636,744 81,506,048 1.16% 945,470 — No. 14 135,000 182,894 No. 16 4,385,000 541,261 3,843,739 36.80% 1,414,496 Metro Transit 1,400,000 593,000 807,000 1.29% 10,410 Metro Council 379,505,000 41,558,448 337,946,552 1.19% 4,021,564 — Anoka County 102,820,298 41,842,857 60,977,441 18.04% 11,000,330 Vocational/Technical District No. 916 9,460,000 133,656 9,326,344 2.21% 206,112 Overlapping debt 617,848,090 123,488,860 494,407,124 17,598,382 — Total direct and overlapping debt $637,448,090 $134,013,766 $503,482,218 $26,673,476 — 176 Table 11 CITY OF FRIDLEY, MINNESOTA — RATIO OF ANNUAL DEBT SERVICE EXPENDITURES FOR GENERAL BONDED DEBT TO TOTAL GENERAL GOVERNMENT EXPENDITURES LAST TEN FISCAL YEARS — Ratio of Debt Total Total Service to Fiscal Debt General General — Year Principal Interest Service Expenditures(1) Expenditure 1985 $120,000 $648,547 $768,547 $6,934,756 .1108.1 — 1986 215,000 1,300,823 1,515,823 8,573,503 .1768.1 1987 740,000 1,508,809 2,248,809 9,566,874 .2351.1 1988 1,380,000 1,423,027 2,803,027 10,721,653 .2614.1 1989 1,640,500 1,540,919 3,181,419 11,349,134 .2803.1 1990 14,720,000 1,069,169 15,789,169 24,675,638 .6399.1 1991 685,000 1,181,305 1,866,305 11,124,569 .1678:1 1992 715,000 1,169,325 1,884,325 11,662,729 .1616:1 1993 925,000 1,270,590 2,195,590 11,908,841 .1844:1 1994 2,305,000 1,147,551 3,452,551 14,151,632 .2440:1 Notes (1) Includes General, Special Revenue, Debt Service and Capital Projects. 177 Table 12 CITY OF FRIDLEY, MINNESOTA REVENUE BOND COVERAGE _ LAST TEN FISCAL YEARS Net Operating Revenue _ Direct Direct Available Fiscal Operating Operating For Debt Debt Service Requirements Year Revenue (1) Expenses (2) Service Principal Interest Total Coverage _ 1985 $2,296,415 $2,253,164 $43,251 $50,000 $5,152 $55,152 0.78 1986 2,434,100 2,522,048 (87,948) 50,000 3,400 53,400 - _ 1987 2,473,814 2,513,721 (39,907) 50,000 1,646 51,646 - 1988 2,725,742 2,943,443 (217,701) 20,000 380 20,380 - 1989 2,879,180 3,134,235 (255,055) - - - - _ 1990 3,049,658 3,213,227 (163,569) - - - - 1991 3,115,437 3,408,068 (292,631) - 148,449 148,449 - 1992 3,111,284 3,764,686 (653,402) - 131,761 131,761 - _ 1993 3,557,088 4,360,448 (803,360) 45,000 129,944 174,944 - 1994 3,985,612 4,534,059 (548,447) 80,000 127,301 207,301 - Notes _ (1) Total operating revenue exclusive of interest on investments. (2) Total operating expenses including depreciation. — 178 — Table 13 CITY OF FRIDLEY, MINNESOTA DEMOGRAPHIC STATISTICS — LAST TEN FISCAL YEARS — Annual Average Fiscal Per Capita Median School Unemployment — Year Population (1) Income Age (4) Enrollment(3) Rate(5) (6) 1985 29,440 10,129 28.9 4,833 4.9% — 1986 29,423 10,635 29.2 4,660 4.3% 1987 29,310 13,238 29.9 4,453 4.7% 1988 29,336 13,241 29.9 4,367 3.1% — 1989 29,250 13,241 31.0 4,362 2.9% 1990 28,335 (2) 16,431 (7) 32.6 (2) 4,371 4.5% 1991 28,313 16,347 32.6 (2) 4,392 4.5% — 1992 28,369 16,055 32.6 (2) 4,361 4.1% 1993 28,287 15,261 30.3 4,200 4.4% 1994 28,287 15,535 30.5 3,942 0.0% Sources: (1) Estimated by Metropolitan Council. 1994 estimate was not available. — (2) 1990 Population Report- Bureau of the Census (3) Estimated- excludes Grace Parochial High School as it is not supported by by property tax dollars. — (4) 1985-1989 and 1991-1994 amounts are for Anoka County. Amounts for the City of Fridley are not available. (5) Minnesota Department of Economic Security-Twin Cities Labor Market — (6) 1985 - 1989 Unemployment Rate as reported is area wide for the County of Anoka rather than for the City of Fridley. (7) National Planning Data Corporation 179 Table 14 CITY OF FRIDLEY, MINNESOTA CONSTRUCTION, BANK DEPOSITS AND PROPERTY VALUE LAST TEN FISCAL YEARS Commercial Construction Residential Construction Estimated Market Value Number Number Bank(1) Fiscal of of Deposits Taxable Non- Year Units Value Units Value (Thousands) Property Taxable(2) Total 1985 54 $12,729,783 365 $5,430,598 $24,074 $829,444,800 $110,559,039 $940,003,839 1986 41 10,871,941 379 5,409,450 27,025 865,600,700 177,123,840 1,042,724,540 1987 54 9,845,600 435 23,413,715 33,201 906,029,600 177,123,840 1,083,153,440 1988 70 17,421,494 340 3,660,384 29,030 934,005,900 177,123,840 1,111,129,740 1989 93 30,529,963 301 3,522,035 30,329 967,589,400 177,123,840 1,144,713,240 1990 83 12,883,850 349 3,321,362 29,902 1,025,348,200 177,123,840 1,202,472,040 1991 75 11,946,068 360 2,525,711 33,520 1,030,419,600 177,123,840 1,207,543,440 1992 73 10,329,409 407 2,873,240 48,098 1,080,449,200 173,900,300 1,254,349,500 1993 69 6,778,632 474 3,536,547 48,376 1,087,284,000 177,929,400 1,265,213,400 1994 115 17,510,011 711 6,365,829 46,888 1,091,782,900 191,559,200 1,283,342,100 Sources: (1) Fridley State Bank (2) Non-taxable property is reevaluated by the city assessors every six years 180 Table 15 CITY OF FRIDLEY, MINNESOTA PRINCIPAL TAXPAYERS DECEMBER 31, 1994 Fiscal Year 1994 Percent 1993* of Total Taxable Taxable Rank Taxpayer Type of Business Valuation Valuation** 1 Dayton Hudson Target discount store, warehouse and office $1,462,836 5.35% 2 Medtronic, Inc. Electro-medical devices 1,160,782 4.25% 3 Onan Corporation Portable electric generators 748,300 2.74% 4 Burlington Northern Railroad Operating property 524,210 1.92% 5 United Defense Systems Naval ordinance 492,908 1.80% 6 Dow Brands Cosmetics 482,963 1.77% 7 University Avenue Associates Springbrook apartments 332,374 1.22% 8 Maurice Fillister Georgetown apartments 314,840 1.15% 9 Retail Trust IV Wal-Mart discount store 269,504 0.99% — 10 East River Road Business Center Business and retail complex 246,215 0.90% Total $6,034,932 22.09% — Notes * The 1994 levy was based upon the January 2, 1993 taxable value. — ** Before contribution to Metropolitan Tax Pool and tax increment financing 181 CITY OF FRIDLEY, MINNESOTA — INSURANCE COVERAGE DECEMBER 31, 1994 All risk perils, 100% coinsurance — Buildings and contents Blanket, agreed amount endorsement, replacement cost coverage $22,413,104 — Contractor's equipment 1,082,486 Boiler and machinery 3,000,000 — Municipal general liability Each occurrence limit 600,000 — Products/completed operations aggregate limit 600,000 Fire damage limit 50,000 Medical expense limit 1,000 _ Medical expense aggregate occurrence limit 10,000 Limited pollution liability limit 600,000 Lead and asbestos liability limit 200,000 _ Land use regulation limit 600,000 Automobile liability Liability 600,000 — Personal injury protection Statutory Uninsured/underinsured motorist 600,000 Comprehensive Actual cash value — Liquor liability General total limit 2,000,000 _ Bodily injury Each person 1,000,000 Each occurrence 1,000,000 Advertising injury each person 1,000,000 — Products and completed work 2,000,000 Law Enforcement professional liability — Combined single limit per loss Personal injury, bodily injury, property damage, punitive damages 600,000 Employee benefit programs liability 600,000 Worker's compensation Statutory PRINCIPAL OFFICIALS' BONDS DECEMBER 31, 1994 All employees are covered by a blanket of faithful performance bond of$100,000. 182 CITY OF FRIDLEY, MINNESOTA MISCELLANEOUS STATISTICAL INFORMATION DECEMBER 31, 1994 Date of Incorporation (Village of Fridley) July 1, 1949 — Date of Adoption of City Charter September 10, 1957 effective September 25, 1957 Form of Government Council/Manager — Fiscal year begins January 1 Area of City 11 square miles Bond rating (Moody's Investors Service, Incorporated) Aa-1 Elections — Last Election -State and Local General November 8, 1994 Registered voters 16,667 Number of votes cast 10,705 — Percent(%) of registered voters voting 64.2% Population — 1950 Federal Census 3,796 1960 Federal Census 15,182 1965 Federal Census 24,789 — 1970 Federal Census 29,233 1980 Federal Census 30,228 1985 Estimated by Metropolitan Council 29,440 1990 Federal Census 28,335 — 1991 Estimated by Metropolitan Council 28,313 1992 Estimated by Metropolitan Council 28,369 1993 Estimated by Metropolitan Council 28,287 — 1994 Estimated by Metropolitan Council Not Available Permanent Employees --As of December 31 Number 1982 123 1983 119 — 1984 119 1985 125 1986 125 1987 125 — 1988 126 1989 126 1990 126 1991 137 1992 137 1993 135 1994 140 183 CITY OF FRIDLEY, MINNESOTA MISCELLANEOUS STATISTICAL INFORMATION (CONTINUED) _ DECEMBER 31, 1994 Fire protection _ Number of stations 3 Volunteer firefighters 32 Full-time firefighters 5 _ Fire rating Class 3 Police protection _ Number of stations 1 Number of sworn officers 36 Number of street lights 1,042 Number of traffic signal installations 35 _ Number of other special signal installations 2 Number of civil defense warning sirens 8 Miles of streets and sidewalks(including State and County) _ City streets 126.09 Trunk highways 10.79 County roads 14.56 _ Sidewalks 10.98 Miles of sewer _ Storm 43.56 Sanitary 103.02 Miles of water mains 112.8 Municipal water system source _ City of Fridley Water Plant (13 wells)--capacity of 15 million gallons per day _ Number of water connections December 31, 1994 8,268 connections Daily average consumption (gallons) 5.03 million gallons _ Elevated storage capacity 2 million gallons Water storage reservoirs 4.5 million gallons Number of fire hydrants 1,080 _ Municipal sewer system Disposal --through Metropolitan Waste Control _ Commission Number of connections December 31, 1994 8,018 connections Average daily flow (includes infiltration/inflow) 5.88 million gallons 184 CITY OF FRIDLEY, MINNESOTA MISCELLANEOUS STATISTICAL INFORMATION (CONTINUED) DECEMBER 31, 1994 Parks and Recreation Areas City 316 Acres County 282 Acres Total 598 Acres City and County Parks Schools Total Number of: Hockey rinks 6 2 8 General skating rinks 15 2 17 Playgrounds 30 4 33 Swimming beaches 1 0 1 Swimming pools 0 1 1 Day camp sites 1 0 1 Baseball diamonds 4 3 7 Softball diamonds 24 7 31 Outdoor basketball courts 19 4 23 Tennis courts 24 19 43 Horseshoe courts 16 0 16 Archery ranges 1 0 1 Permanent playground buildings 3 0 3 Permanent picnic shelters 12 0 12 Soccer/football fields 7 8 15 185 CITY OF FRIDLEY, MINNESOTA GENERAL INFORMATION DECEMBER 31, 1994 — Location - Transportation The City of Fridley, with a total land area of eleven square miles and an estimated population of 28,287, is located at the northern boundaries of Minneapolis and Columbia Heights, about eight miles from the Minneapolis central business district. Freight service is provided in the area by local and interstate — truck lines and Burlington Northern Railroad. Commuter transportation is available through Metropolitan Transit Commission facilities. Highways serving Fridley include interstate #694 (beltline around the metropolitan area) and State Highways. An International Airport, located approximately twenty-five miles — south of Fridley, and private business aviation facilities located at the Anoka County and Crystal Airports, provide air transportation and are operated by the Metropolitan Airport Commission. Medical Facilities Medical facilities in Fridley include Health One Unity Hospital, a 275-bed hospital with an adjacent clinic — (Unity Professional Building), Fridley Plaza Clinic, Fridley Convalescent Home, the Fridley Medical Center, and Lynwood Health Care Center. Education Fridley is served by four school districts, a major portion of the City is located within Fridley — Independent School District No. 14. The Fridley School District operates two elementary schools, a junior high and senior high school, employing 178 certified personnel in the education of about 2,611 students. Grace Parochial High School has an enrollment of approximately 925. Portions of the — Columbia Heights School District (13), the Spring Lake Park School District (16) and Anoka/Hennepin School District (11) also lie within the City of Fridley. Those districts have an estimated enrollment of 1,331 students living within the City of Fridley. Colleges and universities, vocational-technical and specialized training schools are located throughout the metropolitan area within easy commuting distances of Fridley. 186 — CITY OF FRIDLEY, MINNESOTA GENERAL INFORMATION (CONTINUED) DECEMBER 31, 1994 Larger Employers Larger employers in the City of Fridley include: Full-Time Employer Product or Service Employees Medtronics, Inc. Electro-medical devices and hdqtrs. 3,800 Onan Corporation Portable generators, electronic equipment 1,699 — United Defense Systems Pumps and naval ordinance 1,672 Unity Hospital Medical services 1,400 Burlington Northern Railroad Northtown yard 1,100 _ Minco Products, Inc. Electronic devices 600 Kurt Manufacturing Machine parts 575 Dow Brands Cosmetics 350 _ Independent School District#14 Fridley school district 350 Target Stores, Warehouse Discount department store 337 McGlynn's Bakery 325 _ Safetran Systems Corporation Railroad accessories 243 187