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07-26-2023 Council Packet
AGENDA LITTLE CANADA CITY COUNCIL WEDNESDAY, JULY 26, 2023 CALL TO ORDER – Regular Meeting – 7:30 p.m. Roll Call Approval of Minutes July 12, 2023 Workshop Meeting July 12, 2023 Regular Council Meeting Announcements 2023 Night to Unite Proclamation PUBLIC COMMENT Please limit comments to 3 minutes per person. Items brought before the Council will be referred for consideration. Council may ask questions for clarification, but no Council action or discussion will be held on these items. PRESENTATION 1. New District 13 Metropolitan Council Member Chai Lee 2. 2022 Annual Comprehensive Financial Report by Auditors – CliftonLarsonAllen CONSENT AGENDA 3. Approval of the Vouchers 4. Approve Purchase of Tables & Chairs for Little Canada Fire Station 5. Reappoint Youth Commissioners to Parks & Rec and Planning Commissions STAFF REPORTS 6. Consider Tobacco Store License Renewal for The Hookah Hideout at 3 Little Canada Road East 7. Ordinance 875, Amending Chapter 802, Tobacco, to Add Hours of Operation Allowed for Tobacco Stores 8. 2023 Deer Control Program 9. 2nd Quarter 2023 Financial Report 10. Amendment No. 3 to Contract for Water Services with Board of Water Commissioners of the City of St. Paul (St. Paul Regional Water Services) 11. Resolution Granting Approval to an Improvement Project by the Ramsey County HRA at the Provinces Apartments COUNCIL REPORTS & MEETING UPDATES ADJOURN WHEREAS,the Minnesota Crime Prevention Association,along with AAA,and local law enforcement agencies are sponsoring a statewide program called Night to Unite on August 1, 2023; and WHEREAS,Night to Unite is designed to get to know one another in the City of Little Canada, build neighborhood involvement by bringing police and communities together;and to bring an awareness to crime prevention and local law enforcement efforts; and WHEREAS,Night to Unite supports the idea that crime prevention is an inexpensive,effective tool in strengthening police and community partnerships; and WHEREAS,Night to Unite provides opportunities to celebrate the ongoing work of law enforcement and neighborhoods in Little Canada by working together to fight crime and victimization and increase public safety for all citizens; and WHEREAS,the citizens of Little Canada play an important role in assisting the Ramsey County Sheriff’s Office through joint crime, drug and violence prevention efforts; NOW,THEREFORE,I,Mayor Tom Fischer,and WE,Council Members,Amanda Gutierrez, Chris Kwapick,Dave Miller,and Teresa Miller,DO HEREBY CALL UPON ALL CITIZENS OF LITTLE CANADA,RAMSEY COUNTY,to participate in Night to Unite on Tuesday,August 1, 2023. FURTHER,LET IT BE RESOLVED THAT I,Mayor Tom Fischer,and WE,Council Members, Amanda Gutierrez,Chris Kwapick,Dave Miller,and Teresa Miller,do hereby proclaim Tuesday, August 1, 2023, as Night to Unite in Little Canada, Ramsey County, Minnesota. __________________________ Mayor, Thomas Fischer ____________________________________________________ Council Member, Amanda Gutierrez Council Member, Chris Kwapick ____________________________________________________ Council Member, Dave Miller Council Member, Teresa Miller _________________Attested by:_________________________ Date City Administrator, Christopher Heineman Night to Unite 2023 Proclamation CITY OF LITTLE CANADA ANOKA WASHINGTON RAMSEYHENNEPIN CARVER SCOTT DAKOTA §¨¦94§¨¦94 §¨¦494 §¨¦94 §¨¦35E §¨¦694 §¨¦694§¨¦694 §¨¦94 §¨¦35E §¨¦35E §¨¦694 §¨¦94§¨¦94 §¨¦35E §¨¦35E §¨¦694 §¨¦94 §¨¦494 !(36 !(36 !(37 Gem Lake Grant Inver GroveHeights Lake Elmo Landfall Lilydale Little Canada Mahtomedi Maplewood MendotaHeights Newport NorthSt. Paul Oakdale PineSprings Roseville St. Paul Shoreview SouthSt. Paul Sunfish Lake VadnaisHeights West St. Paul WhiteBearTwp. WhiteBear Lake Woodbury Willernie £¤61 £¤52 £¤61 £¤61 £¤61 £¤61 £¤61 £¤52 ÉÉ110 ÉÉ36 ÉÉ36 ÉÉ36 ÉÉ36 Metropolitan Council District 13 ³Council District 13Interstate/Major Highway Road Municipal Boundary County Boundary 1 2 3 4 5678 9 10 11 12 1314 15 16 0 1.5 3 4.5 60.75 Miles May 2023 7/21/23, 10:13 PM Chai Lee,<br /> District 13 - Metropolitan Council https://metrocouncil.org/About-Us/Who-We-Are/CouncilMembers/District-13-Chai-Lee.aspx 1/2 Chai Lee Metropolitan Council Member, District 13 | See District 13 map and cities Chai Lee is a Program Coordinator for Nexus Community Partners. He helps recruit, interview and select people for the Boards and Commissions Leadership Institute (BCLI). Previously, he was a constituent service representative in the office of Saint Paul Mayor Chris Coleman. Lee serves on the District 1 Community Council in Saint Paul and the Gold Line BRT Community and Business Advisory Committee. He has also served on Saint Paul’s Long-Range Capital Investment Budget Committee (the CIB). Biography Chai Lee lives in Saint Paul and represents District 13, which includes the eastern half of Saint Paul, Lilydale, Mendota Heights, Sunfish Lake and West St. Paul. Chai Lee is a Program Coordinator for Nexus Community Partners. There he helps recruit, interview and select people for the Boards and Commissions Leadership Institute (BCLI). The BCLI is a seven-month cohort leadership program, which trains people of color who wish to get appointed to publicly appointed boards and commissions. Previously, he was a constituent service representative in the office of Saint Paul Mayor Chris Coleman. Among his community activities, Lee serves on the District 1 Community Council in Saint Paul and the Gold Line BRT Community and Business Advisory Committee. He is also a youth soccer coach for the Saint Paul Parks and Recreation Department. He has also served on Saint Paul’s Long-Range Capital Investment Budget Committee (the CIB), which reviews, ranks and recommends capital improvements to the City of Saint Paul. Lee is interested in the intersections of the Council’s many responsibilities; for example, how the region balances environmental concerns with the need to house people and provide a robust transportation system. He also has a strong interest in the Council’s role in addressing the region’s affordable housing crisis. “I have worked hard to keep community voices at the table wherever I have served and have always worked on the side of racially equitable policies,” Lee said. “As a Council member, I want to elevate my interests in future policy planning through an equity lens, whether we are making decisions about housing, transportation, water resources or any other issue.” Lee was born in Thailand and moved with his Hmong family to the United States when he was a year old. They lived in Fresno, California, until 1998, and then moved to Saint Paul. Lee graduated from Humboldt High School and earned a bachelor of arts degree in International Relations and Political Science from Carleton College. He enjoys photography, reading, going to movies, and watching mixed martial arts. He’s also a history buff, both military and general history. Committee assignments Community Development Committee CONTACT INFORMATION 390 Robert St. N. Saint Paul, MN 55101 Phone: 612-271-2719 chai.lee@metc.state.mn.us E-NEWSLETTER Subscribe to updates Previous Issues: Public Safety Updates and 2022 Budget - Met Council Member Chai Lee November 23, 2021 APPOINTED Lee was appointed to the Metropolitan Council by Gov. Tim Walz in March 2019. COUNCIL MEMBERS & DISTRICTS Metropolitan Council - metrocouncil.org 7/21/23, 10:13 PM Chai Lee,<br /> District 13 - Metropolitan Council https://metrocouncil.org/About-Us/Who-We-Are/CouncilMembers/District-13-Chai-Lee.aspx 2/2 Management Committee (Vice Chair) Audit Committee (Chair) Equity Advisory Committee METRO Gold Line Community and Business Advisory Committee METRO Gold Line Executive Change Control Board METRO Purple Line BRT Policy Advisory Committee (Alternate) METRO Purple Line Corridor Management Committee (Alternate) Riverview Corridor Policy Advisory Committee (Alternate) 515 Little Canada Road, Little Canada, MN 55117-1600 (651) 766-4029 / FAX: (651) 766-4048 www.littlecanadamn.org MAYOR Tom Fischer COUNCIL Teresa Miller Amanda Gutierrez Dave Miller Chris Kwapick TO: Mayor Fischer and Members of the City Council FROM: Sam Magureanu, Finance Director DATE: July 26, 2023 RE: 2022 Annual Comprehensive Financial Report ACTION REQUESTED Receive and accept the 2022 Comprehensive Annual Financial Report (ACFR). BACKGROUND Michelle Hoffman and Lance Lauinger with the City’s auditing firm, CliftonLarsonAllen (CLA) will present the 2022 ACFR highlights. The auditors have provided an unmodified opinion on the financial statements, which is the highest opinion that can be given. The City is required by Minnesota law to have an external audit completed annually. The audit provides reasonable assurance to the City Council and stakeholders that the financial statements are free of material misstatement and that the financial statements are complete and reliable. The Transmittal Letter (pages 1-7) and the Management’s Discussion and Analysis (pages 14- 24) in the ACFR provide an overview of the 2022 City’s financial operations and results. Audit Findings: The Finance department performed very well during the 2022 fiscal year and has the staff capacity to complete all required tasks for the foreseeable future. A summary of the audit findings is provided below. Staff takes all audit findings seriously and take measures to correct in future as applicable. As noted above, the City of Little Canada received the highest opinion that can be given. The audit findings below present an opportunity to strengthen our internal processes and further develop staff knowledge and abilities. Limited Segregation of Duties –The finding was noted since the City has limited staff in the Finance Department (1.8 FTE’s) and is unable to maintain strong segregation of duties. For example, the Finance Director has access to City assets (cash) and also performs the bank reconciliation. This issue was initiated by the Finance Director during the audit and after further conversations the auditors concluded that this audit finding is necessary to bring awareness to City Council about the risk surrounding existing limited segregation of duties. To effectively implement strong segregation of duties, it would require additional staffing. City staff does not recommend increasing the staff in order to remove the finding since additional costs of implementing the necessary controls outweigh the benefits that would be derived. The finance team will continue to utilize all of the existing resources to help mitigate this risk in all of its finance processes. Material Audit Adjustment – This finding was a result of an error in the Finance department. One payment at year was processed as a 2023 transaction rather than a 2022 transaction. The finance team always strives to identify all of the transactions at year end that should be moved to prior year, however due to the large volume transactions at year-end this one was missed. Public Purpose Policy – This finding was generated as a result of the auditor’s close review of the 2022 expenditures related to Employee and Volunteer Recognition events. In particular, the expenses incurred for the 2022 volunteer appreciation event and holiday party in December triggered this finding. The City’s Public Purpose Policy adopted in 2015 includes language related to holiday parties which is in violation of Minnesota legal compliance guidelines and the City policy does not meet the standards of public purpose. Staff will provide a revised version of the Public Purpose Policy for consideration at an upcoming City Council meeting. The City Council will have the opportunity to ask questions after the presentation. STAFF RECOMMENDATION Receive and accept the 2022 Annual Comprehensive Financial Report. ATTACHMENTS 2022 Annual Comprehensive Financial Report Internal Control Letter Legal Compliance Letter Governance Communication CITY OF LITTLE CANADA, MINNESOTA ANNUAL COMPREHENSIVE FINANCIAL REPORT YEAR ENDED DECEMBER 31, 2022 PREPARED BY THE FINANCE DEPARTMENT OF THE CITY OF LITTLE CANADA, MINNESOTA SAM MAGUREANU DIRECTOR OF FINANCE CITY OF LITTLE CANADA, MINNESOTA TABLE OF CONTENTS YEAR ENDED DECEMBER 31, 2022 INTRODUCTORY SECTION LETTER OF TRANSMITTAL 1 OFFICIAL DIRECTORY 8 ORGANIZATIONAL CHART 9 CERTIFICATE OF ACHIEVEMENT FOR EXCELLENCE IN FINANCIAL REPORTING 10 FINANCIAL SECTION INDEPENDENT AUDITORS’ REPORT 10 MANAGEMENT’S DISCUSSION AND ANALYSIS 14 BASIC FINANCIAL STATEMENTS STATEMENT OF NET POSITION 25 STATEMENT OF ACTIVITIES 26 GOVERNMENTAL FUNDS BALANCE SHEET 27 RECONCILIATION OF THE BALANCE SHEET TO THE STATEMENT OF NET POSITION – GOVERNMENTAL ACTIVITIES 28 STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES 29 RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES TO THE STATEMENT OF ACTIVITIES – GOVERNMENTAL ACTIVITIES 30 PROPRIETARY FUNDS STATEMENT OF NET POSITION 31 STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN NET POSITION 32 STATEMENT OF CASH FLOWS 33 NOTES TO BASIC FINANCIAL STATEMENTS 34 REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES – GENERAL FUND – BUDGET TO ACTUAL (GAAP BASIS) 70 SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES – ECONOMIC DEVELOPMENT FUND – BUDGET TO ACTUAL (GAAP BASIS) 72 NOTES TO REQUIRED SUPPLEMENTARY INFORMATION 73 PERA SCHEDULE OF THE CITY’S PROPORTIONATE SHARE OF THE NET PENSION LIABILITY 74 PERA SCHEDULE OF CITY CONTRIBUTIONS 75 CITY OF LITTLE CANADA, MINNESOTA TABLE OF CONTENTS (CONTINUED) YEAR ENDED DECEMBER 31, 2022 COMBINING AND INDIVIDUAL FUND STATEMENTS AND SCHEDULES NONMAJOR GOVERNMENTAL FUNDS COMBINING BALANCE SHEET 76 COMBINING STATEMENT OF REVENUE, EXPENDITURES, AND CHANGES IN FUND BALANCES 77 NONMAJOR SPECIAL REVENUE FUNDS COMBINING BALANCE SHEET 78 COMBINING STATEMENT OF REVENUE, EXPENDITURES, AND CHANGES IN FUND BALANCES 79 SCHEDULE OF REVENUE, EXPENDITURES, AND CHANGES IN FUND BALANCES – BUDGET AND ACTUAL – PARKS AND RECREATION 80 SCHEDULE OF REVENUE, EXPENDITURES, AND CHANGES IN FUND BALANCES – BUDGET AND ACTUAL – CABLE TV 81 SCHEDULE OF REVENUE, EXPENDITURES, AND CHANGES IN FUND BALANCES – BUDGET AND ACTUAL – RECYCLING/TRASH 82 NONMAJOR DEBT SERVICE FUNDS COMBINING BALANCE SHEET 83 COMBINING STATEMENT OF REVENUE, EXPENDITURES, AND CHANGES IN FUND BALANCES 84 NONMAJOR CAPITAL PROJECTS FUNDS COMBINING BALANCE SHEET 85 COMBINING STATEMENT OF REVENUE, EXPENDITURES, AND CHANGES IN FUND BALANCES 87 STATEMENT OF CHANGES IN ASSETS AND LIABILITIES – AGENCY FUND 89 STATISTICAL SECTION (UNAUDITED) NET POSITION BY COMPONENT 90 CHANGES IN NET POSITION 91 FUND BALANCES, GOVERNMENTAL FUNDS 93 CHANGES IN FUND BALANCES, GOVERNMENTAL FUNDS 94 TAX REVENUE BY SOURCE, GOVERNMENTAL FUNDS 95 TAX CAPACITY VALUE AND ESTIMATED MARKET VALUE OF TAXABLE PROPERTY 96 DIRECT AND OVERLAPPING TAX RATES 97 PRINCIPAL PROPERTY TAXPAYERS 98 PROPERTY TAX LEVIES AND COLLECTIONS 99 RATIOS OF OUTSTANDING DEBT BY TYPE 100 CITY OF LITTLE CANADA, MINNESOTA TABLE OF CONTENTS (CONTINUED) YEAR ENDED DECEMBER 31, 2022 RATIOS OF GENERAL BONDED DEBT OUTSTANDING 101 DIRECT AND OVERLAPPING DEBT 102 LEGAL DEBT MARGIN INFORMATION 103 DEMOGRAPHIC AND ECONOMIC STATISTICS 104 PRINCIPAL EMPLOYERS 105 FULL-TIME EQUIVALENT CITY GOVERNMENT EMPLOYEES BY FUNCTION 106 OPERATING INDICATORS BY FUNCTION 107 CAPITAL ASSET STATISTICS BY FUNCTION 108 INTRODUCTORY SECTION 515 Little Canada Road, Little Canada, MN 55117-1600 (651) 766-4029 / FAX: (651) 766-4048 www.ci.little-canada.mn.us (1) MAYOR Tom Fischer COUNCIL Teresa Miller Amanda Gutierrez Dave Miller Chris Kwapick June 29, 2023 City of Little Canada Mayor and City Council Citizens of Little Canada Little Canada, Minnesota Minnesota statutes require all cities to submit an annual audited financial statement to the Office of the State Auditor. Pursuant to that requirement, we hereby issue the Annual Comprehensive Financial Report for the City of Little Canada for the year ended December 31, 2022. The Annual Comprehensive Financial Report is prepared in accordance with Generally Accepted Accounting Principles (GAAP) as established by the Governmental Accounting Standards Board (GASB), and the American Institute of Certified Public Accountants, State Auditor’s Office and the state of Minnesota, as well as in accordance with the recommendations of the Government Finance Officers Association of the United States and Canada (GFOA). Management assumes full responsibility for the completeness and reliability of the information contained in this report, based upon a comprehensive framework of internal control standards that it has established for this purpose. Because the cost of an internal control should not exceed anticipated benefits, the objective is to provide reasonable, rather than absolute assurance that the financial statements are free of any misstatements. City of Little Canada’s financial statements have been audited by CliftonLarsonAllen LLP, a firm of licensed certified public accountants appointed by the City Council. The goal of the independent audit was to provide reasonable assurance that the financial statements of the City for the year ended December 31, 2022 are free from material misstatement. The independent audit involved examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements; assessing the accounting principles and significant estimates used by management; and evaluating the overall financial statement presentation. Based upon the audit, the independent auditor concluded that there was a reasonable basis for rendering an unmodified opinion that the City’s financial statements, as of and for the year ended December 31, 2022, are presented in conformity with GAAP. The independent auditors’ report is presented as the first component of the financial section of this report. Management’s discussion and analysis (MD&A) immediately follows the independent auditors’ report and provides a narrative introduction, overview, and analysis of the basic financial statements. This letter of transmittal is designed to complement the MD&A and should be read in conjunction with it. (2) PROFILE OF THE CITY The City of Little Canada was originally part of New Canada Township that was created in 1858. In 1953, a portion of the township was incorporated as the Village of Little Canada. In 1974, pursuant to Minnesota Statutes, Little Canada was designated a statutory city. Little Canada is a northern suburb of St. Paul and located wholly in Ramsey County. The land within the City’s boundaries covers 4.48 square miles of which 3.89 square miles is land and .59 square miles is water. The 2020 U.S. Census population for the City was 10,819 which was a 10.70% increase from the 2010 census (9,773). The City operates under the “Optional Plan A” form of government as defined in Minnesota Statutes. Under this plan, the City Council is composed of an elected mayor and four elected council members. The five-member City Council is responsible for policy-making and legislative authority. The City Council is responsible for, among other things, passing ordinances, appointing committees, and hiring the City Administrator. The City Administrator is responsible for carrying out the policies and ordinances of the City Council and for overseeing the day-to-day operations of the City government. The City Council is elected on a nonpartisan basis. The Mayor serves a two-year term and each of the Council Members is elected for a four-year term. Elections are held in the fall of even numbered years and the Mayor and City Council are elected at-large. The City provides a variety of municipal services which include: contracted services for police protection and fire protection, street maintenance, parks & recreation, refuse collection & recycling, building inspection, planning and zoning, public improvements, general administrative services, public water and sewer utilities. The City’s financial planning and control foundation is the annual budget. The budget incorporates the City’s financial policies related to operations, management policy, debt management, reserves, investments, and amendments to the overall documents. All departments and agencies of the City submit requests for appropriation to the City Administrator by June 30 of each year. The City Administrator and Finance Director use the requests as the starting point for developing a preliminary balanced budget to be presented to the City Council prior to September of each year. Before the end of September, the City Council sets the preliminary tax levy, which must take into consideration the maximum tax levy adopted at the annual meeting and must be certified prior to September 30th of each year. This preliminary tax levy can be lowered but not increased before the final budget and levy are adopted in December. FACTORS AFFECTING FINANCIAL CONDITION The information presented in the financial statements is best understood when it is considered from the broader perspective of the environment within which City of Little Canada operates. COVID-19 Pandemic The COVID-19 pandemic was an unprecedented challenge worldwide. While many larger urban areas experienced environmental, socio-economic, management, and transportation related impacts, suburban communities such as Little Canada were primarily health related. Since March, 2020 the City of Little Canada has been responding to all aspects of COVID-19 including the financial implications, and has endeavored to remain flexible and responsive to meeting the needs of the community. LOCAL ECONOMY As part of the Minneapolis/St. Paul metropolitan area, the City has experienced a strong and favorable economic environment for a number of years. The metropolitan region has a strong and diversified business base, including companies with headquarters or divisions located within City of Little (3) Canada’s boundaries including Abbott Laboratories (formerly St. Jude Medical), Slumberland, HOM Furniture, Frattalone Companies, and Q3 / Primoris Services Corporation. These businesses benefit from access to a highly educated work force; access to high technology; available capital and an excellent transportation system including major state highways and federal interstate highways which allows easy mobility in any direction. The location of Little Canada and access to transportation is a very positive factor in making the City an ideal location for commercial/industrial development and redevelopment. BIX Produce relocated to the City of Little Canada in 2019 and is now our fourth largest employer with approximately 330 employees. BIX partners with over 30 local farmers and producers to source quality fruits, vegetables and other products and delivers a wide selection of locally grown products. BIX works closely with local purveyors to ensure that crops are picked at the peak of freshness. In 2022, Vision Loss Resources relocated to an existing building located at 3230 Spruce Street in Little Canada. Vision Loss Resources is a nonprofit provider of training, classes, social activities and support groups for people with vision loss living in the Minneapolis-Saint Paul area. They also operate a for- profit manufacturing and warehousing business located at 3230 and have invested over one million dollars in interior improvements over the past year. A new 74,500 square foot industrial distribution facility was constructed in 2022 for Dart Transit at 3055 Spruce Street in Little Canada. Due to the poor soil conditions on this site, significant subsurface improvements are required for a development of this nature to occur. In 2021, the City Council established an Economic Development Tax Increment Finance (TIF) District to provide assistance with the subsurface improvements and other extraordinary costs required to construct an industrial building on this site. The City is located in a region with a varied economic base which has resulted in an unemployment rate that has consistently remained near or below national and state averages. While the national unemployment rate stood at 3.7% at the end of 2022, the City has a regional unemployment rate of 2.4% according to the Minnesota Department of Economic Security. The City is in a strong financial position. Due to its strong mix of tax base and conservative fiscal policies, the City of Little Canada continues to maintain the 4th lowest tax rate, out of 19 municipal taxing jurisdictions, in Ramsey County in 2021. The strength of the City’s financial condition is also reflected in its most recent bond rating of Aa+ from Standard & Poor’s that was achieved in 2014. LONG-TERM FINANCIAL PLANNING The Metropolitan Council requires all cities in the seven-county metropolitan area to have a Comprehensive Plan. The Metropolitan Council and state statutes require cities to update their plans every 10 years. The Little Canada Comprehensive Plan serves as a guide for orderly and economic private and public improvement. The scope of the plan is intended to include almost every factor that influences investments or improvements in the City. The City’s most recent Comprehensive Plan was approved in 2020. The City has long utilized Capital Improvement Planning (CIP) for facilities, equipment, and infrastructure to enable us to plan and fund needed capital expenditures. This is a ten-year program that is updated and approved annually. Expenditures for a ten-year period are included in the CIP to help ensure significant needs are planned for appropriately. The excess General Fund balance (balance available after complying with the General Fund Balance Policy) is annually allocated to the General Capital Improvement Fund (GCIF). 80% of Local (4) Government Aid (LGA) received from the state of Minnesota also goes into the GCIF rather than the General Fund due to the potential volatility of this revenue source. The City also levies a substantial amount for the Infrastructure Fund in addition to pledging electric franchise fee revenues to help fund street and storm water system construction. By funding a large portion of depreciation from our Water and Sewer funds, we have also provided a stable source of revenue to address infrastructure needs in these areas. RESIDENTIAL DEVELOPMENT ACTIVITY Residential and commercial/industrial new construction picked up in 2022. A total of 502 permits were issued in 2022 with a total valuation of $38,123,007, approximately twice as many permits than in 2021. Residential development is expected to continue to increase with several significant projects in the pipeline. These projects include infill development, new single-family subdivisions, and multi-family apartment projects. Approximately 600 new housing units are planned to be under development in 2023-24, which will result in increase of over 1,300 in population. The City of Little Canada approved a 7-unit single family subdivision that will feature mid-to-high market value homes starting at $750,000. In addition, a market rate neighborhood of 178 townhomes has been approved led by Lennar Corporation, the largest homebuilder in the United States, has purchased 20- acres south of County Road D East in Little Canada. These townhomes would be targeted at entry- level home buyers starting at $375,000. The City of Little Canada has also partnered with a local developer (Reuter-Walton) on a multi-family housing project on City-owned property on Twin Lake Boulevard. The first of two 60-unit buildings with underground parking is nearly completed. The unit mix will be targeted towards working families with children and feature a majority of two-and three-bedroom layouts. Reuter Walton was awarded LIHTC tax credits for both projects and has received $2.5 Million in funding from Ramsey County. The second 60-unit building is slated to break ground in fall of 2023. Reuter-Walton is also working on another multi-family apartment project featuring up to 175 units at the intersection of Demont and Rice Street. The project has received initial funding from Ramsey County, and will be applying for Housing Tax Credits. A senior (55+) apartment project with approximately 110 units has also been proposed along County Road B East and has also received initial funding from Ramsey County. If additional funding is obtained, both of these projects could be under construction in 2024. The City also welcomed several commercial and industrial developments within the City. Royal Credit Union constructed a new bank at the intersection of Rice Street and County Road C. DART Transit also constructed a new warehouse and distribution facility at the corner of South Owasso and Spruce Blvd and is in full operation. The City continues to review strategies regarding community development, looking at how to best utilize sites in the City that would be candidates for new development and redevelopment projects. The City completed a comprehensive update to the zoning code in 2021, which is beginning to foster additional development and redevelopment activities. (5) The City expects to see continued growth in our annual taxable market value as indicated in the chart below: $720,000,000 $760,000,000 $800,000,000 $840,000,000 $880,000,000 $920,000,000 $960,000,000 $1,000,000,000 $1,040,000,000 $1,080,000,000 $1,120,000,000 $1,160,000,000 $1,200,000,000 $1,240,000,000 $1,280,000,000 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 EstimatedMarketValue Estimated Market Value MAJOR INITIATIVES Cooperative Efforts with Other Entities/Jurisdictions: The City contracts with the Little Canada Fire Department for fire services. LCFD is an independent corporation that provides contracted service only to Little Canada. The City contracts for police protection through the Ramsey County Sheriff’s Department. We are one of seven jurisdictions in the County to participate in the relationship. Managers/Administrators of each participant jurisdiction meet monthly to review operations, set budgets, and discuss service level in a cooperative manner that helps keep police costs as low as possible while meeting the public safety needs of our communities. The City is 1 of 45 jurisdictions that contracts with Metro-INET for information technology (IT) services. This arrangement creates an “economy of scale” that enables us to obtain excellent services that would be far more expensive for comparable quality. Little Canada provides building inspection services to Falcon Heights. This arrangement allows both communities to provide a responsive and professional service at lower costs than if we each staff our own inspection program. The City is also exploring other potential partnerships related to building inspection services that may help to make this even more sustainable in the future. Water and Sewer Infrastructure: The City operates and maintains both a water distribution and sanitary sewer collection system. The City of Little Canada maintains a water tower and manages its own water distribution system, but does not have its own wells. Water is purchased from St. Paul Regional Water Service (SPRWS). This water is (6) treated and softened before delivery to our customers. The City is responsible for maintenance of the water system and all customer relations. The City’s sanitary sewer collection system discharges into several Metropolitan Council Environmental Services (MCES) interceptor sewers for treatment by MCES at the Metro Wastewater treatment plant. The City pays MCES for sanitary sewer treatment charges on a quarterly basis, and these MCES treatment costs are included in the City’s sewer billing to residents. The City continues to strive to eliminate significant sources of inflow and infiltration of ground water into the City’s sanitary sewer system. Past efforts have included a sump pump inspection program, televising of city sewer mains and repairs of system leaks, and lining of sewer services in high water table areas. We are also starting to televise sewer service lines. Because the MCES charges are based on measured flow, any reduction of inflow and infiltration results in lower charges to the City and our customers. The City has one water tower to serve the needs of the community. The water tower also generates significant revenue through leases to telecommunications providers to meet their antenna needs. RELEVANT FINANCIAL POLICIES Financial trends in this millennium indicate the City will experience an increased reliance on service fees and property taxes as key funding sources for operations and capital improvements. In Little Canada’s case, our fully developed status means building and development related fees need to be estimated conservatively to avoid huge fluctuations in revenue. Interest income on existing fund balances is expected to increase in future years as the market has seen higher yields toward the end of 2022 and beginning of 2023. Through constant monitoring of operations and performance and through agile responses to changing conditions, the City has been able to maintain its financial condition despite external challenges. Conservative financial management policy has directed the City’s finances for many years and in 2007, they were formalized in written form. These policies were updated and adopted by City Council in 2019. STATISTICAL SECTION The statistical section presents comparative statistical data for the past 10 years, and other pertinent information involving taxes, revenues, expenditures, and bonded debt. The unaudited data should be of interest to investors of City of Little Canada bonds, financial institutions, or others interested in financial statistics of municipal governments. The statistical section includes selected financial and demographic information, generally presented on a multi-year basis. AWARDS AND ACKNOWLEDGMENTS 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 Little Canada for its Annual Comprehensive Financial Report for the fiscal year ended December 31, 2021. This was the seventh year that the City applied for and received this prestigious award. In order to be awarded a Certificate of Achievement, the government must publish an easily readable and efficiently organized Annual Comprehensive Financial Report. This report must satisfy both accounting principles generally accepted in the United States of America and applicable legal requirements. (7) A Certificate of Achievement is valid for a period of one year only. We believe that our current Annual Comprehensive Financial Report continues to meet the Certificate of Achievement Program’s requirement and we are submitting it to the GFOA to determine its eligibility for another certificate. The preparation of this report would not have been possible without the dedicated services of the Finance Department staff. I would like to express my appreciation to all of those who assisted and contributed to the preparation of this report. Recognition is also extended to the City Council for their unfailing support for maintaining the highest standards of professionalism in the management of City of Little Canada’s financial operations. Respectfully submitted, Christopher Heineman City Administrator CITY OF LITTLE CANADA, MINNESOTA OFFICIAL DIRECTORY YEAR ENDED DECEMBER 31, 2022 (8) CITY COUNCIL AND OTHER OFFICIALS Term Expires John Keis, Mayor December 31, 2022 Tom Fischer, Council Member December 31, 2022 Michael McGraw, Council Member December 31, 2024 Teresa Miller, Council Member December 31, 2024 Christian Torkelson, Council Member December 31, 2022 CITY OFFICIALS Chris Heineman City Administrator Sam Magureanu Finance Director CITY OF LITTLE CANADA, MINNESOTA ORGANIZATIONAL CHART YEAR ENDED DECEMBER 31, 2022 (9) CITY OF LITTLE CANADA, MINNESOTA CERTIFICATE OF ACHIEVEMENT FOR EXCELLENCE IN FINANCIAL REPORTING DECEMBER 31, 2022 (10) FINANCIAL SECTION CLA(CliftonLarsonAllenLLP)isanindependentnetworkmemberofCLAGlobal.SeeCLAglobal.com/disclaimer. CliftonLarsonAllenLLP CLAconnect.com (10) INDEPENDENT AUDITORS’ REPORT Honorable Mayor and the City Council City of Little Canada, Minnesota Report on the Audit of the Financial Statements Opinions We have audited the accompanying financial statements of the governmental activities, the business- type activities, each major fund, and the aggregate remaining fund information of the City of Little Canada, as of and for the year ended December 31, 2022, and the related notes to the financial statements, which collectively comprise the City of Little Canada’s basic financial statements as listed in the table of contents. In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Little Canada, as of December 31, 2022, and the respective changes in financial position and budgetary comparison schedules, and, where applicable, cash flows thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America. Basis for Opinions We conducted our audit in accordance with auditing standards generally accepted in the United States of America (GAAS) and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the City of Little Canada and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions. Emphasis of Matters As discussed in Note 1 to the financial statements, effective January 1, 2022, the City adopted new accounting guidance for leases. The guidance requires lessees to recognize a right-to-use lease asset and corresponding lease liability and lessors to recognize a lease receivable and corresponding deferred inflow of resources for all leases with lease terms greater than twelve months. Our opinions are not modified with respect to this matter. Honorable Mayor and the City Council City of Little Canada, Minnesota (11) Responsibilities of Management for the Financial Statements Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the City of Little Canada’s ability to continue as a going concern for twelve months beyond the financial statement date, including any currently known information that may raise substantial doubt shortly thereafter. Auditors’ Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinions. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with GAAS and Government Auditing Standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements. In performing an audit in accordance with GAAS and Government Auditing Standards, we: x Exercise professional judgment and maintain professional skepticism throughout the audit. x Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. x Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of City of Little Canada’s internal control. Accordingly, no such opinion is expressed. x Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements. Honorable Mayor and the City Council City of Little Canada, Minnesota (12) x Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about City of Little Canada’s ability to continue as a going concern for a reasonable period of time. We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control related matters that we identified during the audit. Required Supplementary Information Accounting principles generally accepted in the United States of America require that the management’s discussion and analysis, budgetary comparison information, PERA schedule of the City’s proportionate share of the net pension liability, and PERA schedule of city contributions be presented to supplement the basic financial statements. Such information is the responsibility of management and, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with GAAS, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. Supplementary Information Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City of Little Canada’s basic financial statements. The combining and individual fund statements and schedules are presented for purposes of additional analysis and are not a required part of the basic financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. The information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with GAAS. In our opinion, the combining and individual fund statements and schedules is fairly stated, in all material respects, in relation to the basic financial statements as a whole. Honorable Mayor and the City Council City of Little Canada, Minnesota (13) Other Information Management is responsible for the other information included in the annual report. The other information comprises the introductory and statistical sections but does not include the basic financial statements and our auditors’ report thereon. Our opinions on the basic financial statements do not cover the other information, and we do not express an opinion or any form of assurance thereon. In connection with our audit of the basic financial statements, our responsibility is to read the other information and consider whether a material inconsistency exists between the other information and the basic financial statements, or the other information otherwise appears to be materially misstated. If, based on the work performed, we conclude that an uncorrected material misstatement of the other information exists, we are required to describe it in our report. Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated June 29, 2023, on our consideration of the City of Little Canada’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the City of Little Canada’s internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering City of Little Canada’s internal control over financial reporting and compliance. CliftonLarsonAllen LLP Minneapolis, Minnesota June 29, 2023 CITY OF LITTLE CANADA, MINNESOTA MANAGEMENT’S DISCUSSION AND ANALYSIS YEAR ENDED DECEMBER 31, 2022 (14) As management of the City of Little Canada, Minnesota (the City), we have provided readers of the City’s financial statements with this narrative overview and analysis of the financial activities of the City for the fiscal year ended December 31, 2022. We encourage readers to consider the information presented here in conjunction with additional information that we have furnished in our letter of transmittal. FINANCIAL HIGHLIGHTS o The assets and the deferred outflows of resources exceeded liabilities and deferred inflows of resources by $58,433,926 (net position). Of this amount $17,901,784 (unrestricted net position) may be used to meet the government’s ongoing obligation to citizens and creditors. o The net position of the City’s governmental activities increased by $2,337,965 as a result of current year operations. Net position was $48,219,521 at year-end. o The net position of the City’s business-type activities increased by $26,359 as a result of current year operations. Net position was $10,214,405 at year-end. o The fund balance of the General Fund increased by $412,645 (or 12.9 %) during the year to $3,614,509 at year-end. o At the end of the current fiscal year, the City’s governmental funds reported a combined ending fund balance of $18,193,150. o At the end of the current fiscal year, the City of Little Canada had total long-term debt outstanding of $3,055,874. This is a decrease of $293,809 from prior fiscal year. OVERVIEW OF THE FINANCIAL STATEMENTS The Management’s Discussion and Analysis is intended to serve as an introduction to the City’s basic financial statements, which are comprised of three components: 1) government-wide financial statements, 2) fund financial statements, and 3) notes to the basic financial statements. This report also contains other information in addition to the basic financial statements themselves. Government-Wide Financial Statements – The government-wide financial statements are designed to provide readers with a broad overview of the City’s finances in a manner similar to private sector businesses. The statement of net position presents information on all the City’s assets, deferred outflows of resources, liabilities, and deferred inflows of resources, with the difference between them reported as net position. Over time, increases in net position may serve as a useful indicator of whether the financial position of the City is improving or deteriorating. The statement of activities presents information showing how the City’s net position changed during the most recent fiscal year. All changes to net position are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported in this statement for some items that will only result in cash flows in future fiscal periods (e.g. delinquent taxes and special assessments). CITY OF LITTLE CANADA, MINNESOTA MANAGEMENT’S DISCUSSION AND ANALYSIS YEAR ENDED DECEMBER 31, 2022 (15) Both of the government-wide financial statements distinguish functions of the City that are principally supported by property taxes and intergovernmental revenues (governmental activities) from other functions that are intended to recover all or a significant portion of their costs through user fees and charges (business-type activities). The governmental activities include general government, public safety, public works, and community services. The business-type activities of the City include enterprises for water operating and sewer operating. Fund Financial Statements – A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. The City, like other state and local governments, uses fund accounting to ensure and demonstrate compliance with finance related legal requirements. The funds of the City are divided into three categories - governmental funds, proprietary funds, and fiduciary funds. Governmental Funds – Governmental funds are used to account for essentially the same functions as governmental activities in the government-wide financial statements. However unlike the government- wide financial statements, governmental fund financial statements focus on near-term inflows and outflows of spendable resources, as well as the balances of spendable resources available at the end of the fiscal year. Such information may be useful in evaluating a government’s near-term financing requirements. Because the focus of governmental funds is narrower than that of the government-wide financial statements, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government-wide financial statements. By doing so, readers may better understand the long-term impact of the government’s near-term, financing decisions. Both the governmental funds balance sheet and the statement of revenues, expenditures, and changes in fund balances provide a reconciliation to facilitate the comparison between governmental funds and governmental activities. The fund financial statements present information for each major governmental fund in separate columns. Data from the nonmajor governmental funds are combined into a single, aggregated presentation. Individual fund data for each of these nonmajor governmental funds is provided in the form of combining statements elsewhere in this report. The City adopts an annual appropriated budget for its General Fund, special revenue funds, and proprietary funds. Budget-to-actual comparisons for the General Fund and all special revenue funds are provided in this financial report. Proprietary Funds – The City maintains one type of proprietary fund. Enterprise funds are used to report the same functions presented as business-type activities in the government-wide financial statements. The City uses enterprise funds to account for its water and sewer. Proprietary funds provide the same type of information as the government-wide financial statements, only in more detail. The proprietary fund financial statements provide separate information for each of the enterprise funds which are considered to be major funds of the City. Fiduciary Funds – Fiduciary funds are used to account for resources held for the benefit of parties outside the City. Fiduciary funds are not reflected in the government-wide financial statements because the resources of those funds are not available to support the City’s own programs. The accounting used for fiduciary funds is much like that used for proprietary funds. CITY OF LITTLE CANADA, MINNESOTA MANAGEMENT’S DISCUSSION AND ANALYSIS YEAR ENDED DECEMBER 31, 2022 (16) Notes to Basic Financial Statements – The notes to basic financial statements provide additional information that is essential to a full understanding of the data provided in the government-wide and fund financial statements. Other Information – Combining statements and schedules for nonmajor funds are presented immediately following the notes to basic financial statements. As noted earlier, net position may serve over time as a useful indicator of a government’s financial position. In the case of the City of Little Canada, assets and deferred outflows of resources exceeded liabilities and deferred inflows of resources by $58,433,926 at the close of the most recent fiscal year. The following is a summary of the City’s net position: 2022 2021 2022 2021 2022 2021 Current and Other Assets 22,106,400$ 20,874,837$ 4,717,417$ 3,109,410$ 26,823,817$ 23,984,247$ Capital Assets 31,006,058 29,978,399 7,596,291 7,638,793 38,602,349 37,617,192 Total Assets 53,112,458 50,853,236 12,313,708 10,748,203 65,426,166 61,601,439 Deferred Outflows of Resources 316,342 354,996 189,160 235,745 505,502 590,741 Other Liabilities 1,302,506 1,290,530 142,189 208,429 1,302,506 1,290,530 Long-Term Liabilities Due Within One Year 372,723 292,199 35,080 - 407,803 292,199 Due in More Than One Year 3,520,453 3,313,531 600,745 301,642 4,213,887 3,771,145 Total Liabilities 5,195,682 4,896,260 778,014 510,071 5,924,196 3,771,145 Deferred Inflows of Resources 13,597 430,416 1,510,449 285,831 1,524,046 716,247 Net Position: Net Investment in Capital Assets 27,802,478 26,571,556 7,596,291 7,638,793 35,398,769 34,210,349 Restricted 5,133,373 3,679,079 - - 5,133,373 3,679,079 Unrestricted 15,283,670 15,630,921 2,618,114 2,549,253 17,901,784 18,180,174 Total Net Position 48,219,521$ 45,881,556$ 10,214,405$ 10,188,046$ 58,433,926$ 56,069,602$ Governmental Activities TotalBusiness-Type Activities The City’s net investment in capital assets is $35,398,769 or 60.6% of the total net position, and reflects its investment in capital assets (e.g. land, buildings, infrastructure, machinery and equipment, and vehicles); less any related debt used to acquire those assets that are still outstanding. The City uses these capital assets to provide services to citizens; consequently, these assets are not available for future spending. Although the City’s investment in its capital assets is reported net of related debt, it should be noted that the resources needed to repay this debt must be provided from other sources, since the capital assets themselves cannot be used to liquidate these liabilities. An additional portion of the City’s net position, $5,133,373 or 8.8% represents resources that are subject to external restrictions on how they may be used. The remaining balance of unrestricted net position, $17,901,784 or 30.6% may be used to meet the City’s ongoing obligations to citizens and creditors. At the end of the current fiscal year, the City is able to report positive balances in all categories of net position, both for the City as a whole, as well as for its separate governmental and business-type activities. The City has historically been financially conservative, managing revenues and expenditures/expenses to assure the operation of a balanced budget. This conservative approach and the sound financial position the City has attained, have resulted in the City’s excellent bond ratings: AA+ for all general obligation bond issues. CITY OF LITTLE CANADA, MINNESOTA MANAGEMENT’S DISCUSSION AND ANALYSIS YEAR ENDED DECEMBER 31, 2022 (17) The following is a summary of the City’s change in net position: 2022 2021 2022 2021 2022 2021 REVENUES Program Revenues: Charges for Services $ 1,948,523 $ 908,285 $ 3,611,932 $ 3,484,513 $ 5,560,455 $ 4,392,798 Operating Grants and Contributions 698,238 343,816 - - 698,238 343,816 Capital Grants and Contributions 1,225,082 1,019,104 369,202 - 1,594,284 1,019,104 General Revenues: Property Taxes 3,997,591 3,601,885 - - 3,997,591 3,601,885 Other Taxes 466,344 1,187,896 - - 466,344 1,187,896 Contributions Not Restricted to Specific Programs 1,070,717 434,909 - - 1,070,717 434,909 Unrestricted Investment Earnings (301,608) 6,597 1,557 (4,420) (300,051) 2,177 Other 576,214 - 4,044 - 580,258 - Gain on Sale of Capital Assets - 61,373 (61,373) - Total Revenues 9,681,101 7,563,865 3,986,735 3,480,093 13,667,836 10,982,585 EXPENSES General Government 897,492 761,904 - - 897,492 761,904 Housing and Economic Development 274,253 282,710 - - 274,253 282,710 Public Safety 2,658,787 2,585,476 - - 2,658,787 2,585,476 Public Works 2,431,627 2,187,357 - - 2,431,627 2,187,357 Sanitation 476,404 462,250 476,404 462,250 Culture and Recreation 922,706 717,520 - - 922,706 717,520 Interest on Long-Term Debt 108,818 123,869 - - 108,818 123,869 Water - - 1,968,973 1,766,622 1,968,973 1,766,622 Sewer - - 1,616,403 1,514,193 1,616,403 1,514,193 Total Expenses 7,770,087 7,121,086 3,585,376 3,280,815 11,355,463 10,401,901 CHANGE IN NET POSITION BEFORE SPECIAL ITEMS AND TRANSFERS 1,911,014 442,779 401,359 199,278 2,312,373 580,684 Special Item 51,951 - - - 51,951 - Transfers 375,000 244,438 (375,000) (244,438) - - Total Special Items and Transfers 426,951 244,438 (375,000) (244,438) 51,951 - CHANGE IN NET POSITION 2,337,965 687,217 26,359 (45,160)2,364,324 642,057 Net Position - Beginning of Year 45,881,556 45,194,339 10,188,046 10,233,206 56,069,602 55,427,545 NET POSITION - END OF YEAR 48,219,521$ 45,881,556$ 10,214,405$ 10,188,046$ 58,433,926$ 56,069,602$ Governmental Activities Business-Type Activities Total Net position increased by $2,337,965 or 5.09% in governmental activities as a result of current year operations. Increased revenues accounted for the change in net position. Overall revenues from governmental activities increased $2,117,236. The increase in governmental activities revenues can be attributed to licenses and permits revenue of $562,379 in the current year versus $195,101 the in prior year, an increase of $367,278, as well as an increase in park fees of $102,363 from the prior year as a result of the new developments of Gervais Woods Second Addition and Twin Lake Housing Development. Further, the City received a $400,000 donation for the Pioneer Park Playground from LCRA, with the park scheduled for completion in 2023. The City also recognized $506,768 of ARPA revenues in current year for the Rondeau Park Improvements and $126,257 in state grants were received in the current year; $29,257 for Emerald Ash Borer project and $97,000 for the Gervais Mill project. Lastly, the City sold a property for $498,543 to a developer for the Twin Lake Housing Development. Governmental activities expenses increased by 9.11% or $649,001. The increase is primarily due to an increase in public safety costs of $73,311 from prior year, as police and fire contracts with neighboring governments increased a total of $32,180 and protective inspections costs increased $21,096. Public Works expenditures also increased $244,280 from the prior year. Of this increase, $41,365 of this increase relates to personnel services as well as one additional part time staff added during the year, approximately $56,000 relates to operating cost increases due to inflationary price hikes during the year, and $13,000 relates to an increase in electric and gas utilities over prior year. CITY OF LITTLE CANADA, MINNESOTA MANAGEMENT’S DISCUSSION AND ANALYSIS YEAR ENDED DECEMBER 31, 2022 (18) Lastly, culture and recreation costs have increased $205,186 from the prior year primarily due to an increase in personnel costs of approximately $50,000 due to a full year for the Parks & Recreation Coordinator (started in August of 2021 part time and moved to full time in 2022). The Park and Rec special revenue fund also had an increase from prior year of $31,325 due to more programs in 2022 (the COVID pandemic impacted in programs in 2021). Net position in the business-type activities increased by $26,359 or 0.25%. The increase in net position is a result of current year operations. Governmental Activities The following graph depicts the various governmental activities and shows the expenses and program revenues directly related to those activities: Program Expenses and Revenues – Governmental Activities $Ͳ $500,000 $1,000,000 $1,500,000 $2,000,000 $2,500,000 $3,000,000 GeneralGovernmentHousingandEconomicDevelopmentPublicSafety PublicWorks Sanitation CultureandRecreationInterestandFiscalCharges Expenses Revenues CITY OF LITTLE CANADA, MINNESOTA MANAGEMENT’S DISCUSSION AND ANALYSIS YEAR ENDED DECEMBER 31, 2022 (19) The graph below shows the governmental activities and their income and clearly reflects the need for property taxes to supplement the activities of the City, since the other sources of revenue are insufficient to fund the governmental activities. Revenues by Source – Governmental Activities Charges for Services, 20% Operating Grants and Contributions, 4% Capital Grants and Contributions, 13%Property Taxes, 41% Other Taxes, 5% Contributions Not Restricted to Specific Programs, 11% Unrestricted Investment Earnings, 4% Other, 6% Gain on Sale of Capital Assets, 0% CITY OF LITTLE CANADA, MINNESOTA MANAGEMENT’S DISCUSSION AND ANALYSIS YEAR ENDED DECEMBER 31, 2022 (20) Business-Type Activities Business-type activities had an overall increase in net position of $26,359. The increase in net position is a result of current year operations. One of the biggest expenses is depreciation (noncash expense) within the water and sewer funds. In total for the water and sewer funds combined operating costs increased $288,955. An increase of $96,345 relates to purchased water charges from the St Paul Regional Water Services. The City offset this increase with a modest 4.2% increase in water rates during the year. Additional increases in expenses are due to an increase of $85,333 in personnel cost, primarily related to a 3.3% COLA increase, and a $117,981 increase in supplies, services, and other charges. Program Expenses and Revenues – Business-Type Activities Ͳ 500,000 1,000,000 1,500,000 2,000,000 2,500,000 Water Sewer Expenses ProgramRevenues Charges for Services 90% Capital Grants and Contributions 9% Unrestricted Investment Earnings 1% Unrealized Gain (Loss) on Investments 0% Financial Analysis of the Governmental Funds Governmental Funds The focus of the City of Little Canada’s governmental funds is to provide information on near-term inflows, outflows, and balances of spendable resources. Such information is useful in assessing the CITY OF LITTLE CANADA, MINNESOTA MANAGEMENT’S DISCUSSION AND ANALYSIS YEAR ENDED DECEMBER 31, 2022 (21) City of Little Canada’s financing requirements. In particular, unassigned fund balance may serve as a useful measure of a government’s net resources for spending at the end of the fiscal year. At the end of the current fiscal year, the City’s governmental funds report combined ending fund balance of $18,193,150, an increase of $1,106,425 or 6.47%. Approximately 14.60% of the ending fund balance total or $2,656,007, constitutes unassigned fund balance. The remaining fund balance of $15,537,143 is not available for new spending because it is either 1) nonspendable $574,629 2) restricted $3,088,726, 3) committed $1,464,755, or 4) assigned $10,409,033 for other purposes. General Fund The General Fund is the main operating fund of the City. Its primary revenue source in 2022 was property taxes at 75.59% of the total revenue, followed by licenses and permits at 12.25% and intergovernmental revenue at 7.32%. The total fund balance increased by $412,645 during the current fiscal year 2022, resulting from an excess of revenue over expenditures of $322,882 combined with net transfers in of $89,763. The unassigned fund balance of $3,039,880 at the end of 2022 represents 71.32% of total General Fund expenditures for the year 2022 and 62.6% of General fund budgeted expenditures for the year 2023. Additional detail of the Fund Balance Policy can be found in Note 14 of the notes to the basic financial statements. Other Major Governmental Funds The Economic Development fund had an increase in fund balance of $714,445, to arrive at an ending fund balance of $744,421. The increase in fund balance was due a transfer from the Owasso/Woodlyn Redevelopment Fund 474 of $672,836. The transfer was approved by council during the year and brought the Owasso/Woodlyn Redevelopment Fund 474 to a zero balance. Since all the funds have been transferred to the EDA fund, Owasso/Woodlyn Redevelopment Fund 474 will be closed in 2023. The General Capital Improvements fund experienced an increase in fund balance of $917,719 during the current fiscal year to arrive at an ending fund balance of $3,609,569. The increase was due to planned revenue receipts that will be used to fund future capital improvement projects that have been identified in the City’s ten-year Capital Improvement Plan, and the sale of property to a developer for $498,543 for the Twin Lake Housing Development. The Infrastructure CIP fund had a decrease in fund balance of $923,172 during the current fiscal year to arrive at an ending fund balance of $2,447,079. The decrease was due to planned expenditures that have been identified in the City’s ten-year Capital Improvement Plan, $2,026,925 in 2022 versus $932,851 in 2021. Proprietary Funds The City of Little Canada’s proprietary funds provide the same type of information found in the government-wide financial statements, but in more detail. At the end of the year, net position of the Water and Sewer funds totaled $10,191,897 or $28,825 more than 2021, primarily due to an increase in contributed assets in 2022 compared to 2021. Unrestricted net position increased $72,327 due to increased revenues (rate increase). Budgetary Highlights CITY OF LITTLE CANADA, MINNESOTA MANAGEMENT’S DISCUSSION AND ANALYSIS YEAR ENDED DECEMBER 31, 2022 (22) General Fund There were not any adjustments to the Original Budget. The actual results were different than the final budget amounts. Large differences are as follows: x Total General Fund revenues exceeded the budget by $274,470. The biggest budget variances for revenue categories were within Property Taxes ($79,155), License and Permits ($239,224) and MSA funds ($27,473). o Property Taxes were $79,155 greater than anticipated property tax collections due to a higher collection rate than budgeted. Since the City exercises a conservative budget approach, a 97.5% collection rate is used for budgeting property taxes, but the City experienced a 99.52% collection rate for 2022. o Licenses and Permits were $239,224 greater than budget, primarily due to an increased number of permits issued for new development projects (Twin Lake) and increased roofing and siding permits due to hailstorms. o Rents and Refunds were less than the budget by $17,579 since the sheriff’s reimbursement was lower than budget by $21,710. Total General Fund Expenditures were under budget by $69,795. The biggest positive budget variance for expenditure categories was in General Government, due to lower than anticipated costs for attorneys ($14,558) and planning and zoning ($13,134). Public Works also had a positive budget variance of $9,221, primarily related to lower street maintenance costs of $20,296. Part of this variance was offset by higher costs for the City Garage of $11,257 (increase costs in utilities). CITY OF LITTLE CANADA, MINNESOTA MANAGEMENT’S DISCUSSION AND ANALYSIS YEAR ENDED DECEMBER 31, 2022 (23) Capital Assets The City’s investment in capital assets (net of accumulated depreciation) for its governmental and business-type activities as of December 31, 2022 amounts to $38,602,349. 2022 2021 2022 2021 2022 2021 Land 3,620,111$ 3,620,111$ 103,301$ 103,301$ 3,723,412$ 3,723,412$ Construction in Progress 671,484 172,438 4,672 - 676,156 172,438 Buildings and Building Improvements 7,676,257 7,665,497 - - 7,676,257 7,665,497 Improvements Other than Buildings 1,798,893 1,251,714 - - 1,798,893 1,251,714 Streets and Infrastructure 46,836,550 45,026,775 - - 46,836,550 45,026,775 Distribution/Collection Systems - - 19,118,513 18,824,340 19,118,513 18,824,340 Machinery and Equipment 6,055,039 5,998,103 1,255,442 1,185,085 7,310,481 7,183,188 Total Capital Assets 66,658,334 63,734,638 20,481,928 20,112,726 87,140,262 83,847,364 Less: Accumulated Depreciation (35,652,276) (33,756,239) (12,885,637) (12,473,933) (48,537,913) (46,230,172) Total Capital Assets, Net 31,006,058$ 29,978,399$ 7,596,291$ 7,638,793$ 38,602,349$ 37,617,192$ Capital Assets at Year-End (Net of Accumulated Depreciation) Governmental Activities Business-Type Activities Total The largest capital asset purchases in 2022 for the governmental activities were for the 2022 street improvements, which included Rayan Drive in the amount of $509,554, Woodlyn Avenue in the amount of $590,603, Maple Lane in the amount of $290,298, and Yorkton Ridge in the amount of $288,371. Additionally, $216,656 was spent toward the Twin Lake Blvd project during the year. The project is expected to be completed in 2023. In addition, a deposit $675,499 has been recorded for a new Fire Truck during the year. For the business-type activities, $601,364 of expenses were capitalized during the year. One of the largest projects, in the amount of $259,042, related to the 2022 Sewer Lining. Additional details of capital asset activity for the year can be found in Note 6 of the notes to basic financial statements. Long-Term Liabilities At the end of the current fiscal year, the City had total bonded debt, notes payable, and compensated absences payable outstanding of $3,055,874. While all of the City’s bonds have revenue streams, they are all still backed by the full faith and credit of the City. As in the recent past, the property tax levy was not used to support any debt during the current fiscal year. 2022 2021 2022 2021 2022 2021 General Obligation Bonds 2,815,000$ 3,100,000$ -$ -$ 2,815,000$ 3,100,000$ Notes Payable 18,093 25,282 - - 18,093 25,282 Compensated Absences 122,337 115,910 84,580 82,269 206,917 198,179 Bond Premium (Discount), Net 15,864 26,222 - - 15,864 26,222 Total Outstanding Debt 2,971,294$ 3,267,414$ 84,580$ 82,269$ 3,055,874$ 3,349,683$ Outstanding Debt at Year-End Governmental Activities Business-Type Activities Total Additional details of long-term debt activity for the year can be found in Note 7 of the notes to basic financial statements. CITY OF LITTLE CANADA, MINNESOTA MANAGEMENT’S DISCUSSION AND ANALYSIS YEAR ENDED DECEMBER 31, 2022 (24) REQUESTS FOR INFORMATION This financial report is designed to provide a general overview of the City’s finances for all those with an interest in the City’s finances. Questions concerning any of the information provided in this report or requests for additional information should be addressed to the Finance Department, City of Little Canada, 515 Little Canada Road East, Little Canada, Minnesota 55117. BASIC FINANCIAL STATEMENTS CITY OF LITTLE CANADA, MINNESOTA STATEMENT OF NET POSITION DECEMBER 31, 2022 See accompanying Notes to Basic Financial Statements. (25) Governmental Business-Type Activities Activities Total ASSETS Cash and Investments 17,350,662$ 2,085,299$ 19,435,961$ Accrued Interest Receivable 39,595 - 39,595 Accounts Receivable 827,330 890,645 1,717,975 Lease Receivable - 1,557,028 1,557,028 Property Taxes Receivable: Delinquent 68,376 - 68,376 Due from County 13,477 - 13,477 Special Assessments Receivable 2,081,963 - 2,081,963 Internal Balances (22,508) 22,508 - Due from Other Governments 334,548 48,131 382,679 Prepaid Items 709,142 113,806 822,948 Property Held for Resale 703,815 - 703,815 Capital Assets: Nondepreciable 4,291,595 107,973 4,399,568 Depreciable, Net 26,714,463 7,488,318 34,202,781 Total Assets 53,112,458 12,313,708 65,426,166 DEFERRED OUTFLOWS OF RESOURCES Deferred Outflows of Resources - Pensions 316,342 189,160 505,502 LIABILITIES Accounts and Contracts Payable 471,082 62,369 533,451 Accrued Salaries and Fringes 17,381 - 17,381 Accrued Interest Payable 34,914 - 34,914 Deposits 94,214 - 94,214 Unearned Revenue 645,246 - 645,246 Due to Other Governmental Units 39,669 79,820 119,489 Long-Term Liabilities: Net Pension Liability 921,882 551,245 1,473,127 Other Due Within One Year 372,723 35,080 407,803 Other Due in More Than One Year 2,598,571 49,500 2,648,071 Total Liabilities 5,195,682 778,014 5,973,696 DEFERRED INFLOWS OF RESOURCES Deferred Inflows of Resources - Pensions 13,597 8,131 21,728 Deferred Inflows of Resources - Leases - 1,502,318 1,502,318 Total Deferred Inflows of Resources 13,597 1,510,449 1,524,046 NET POSITION Net Investment in Capital Assets 27,802,478 7,596,291 35,398,769 Restricted for: Debt Service 535,035 - 535,035 Tax Increments 1,297,781 - 1,297,781 Fire Equipment 496,573 - 496,573 Park Acquisition 970,931 - 970,931 Capital Projects 1,669,994 - 1,669,994 Charitable Gambling 163,059 - 163,059 Unrestricted 15,283,670 2,618,114 17,901,784 Total Net Position 48,219,521$ 10,214,405$ 58,433,926$ Primary Government CITY OF LITTLE CANADA, MINNESOTA STATEMENT OF ACTIVITIES YEAR ENDED DECEMBER 31, 2022 See accompanying Notes to Basic Financial Statements. (26) OperatingCapitalCharges for Grants and Grants and Governmental Business-Type Functions/Programs ExpensesServices Contributions Contributions Activities ActivitiesTotalPrimary Government:Governmental Activities:General Government 897,492$ 118,794$ 10,689$ -$ (768,009)$ -$ (768,009)$ Housing and Economic Development 274,253 46,599 - - (227,654) - (227,654) Public Safety2,658,787 608,290 75,644 130,000 (1,844,853) - (1,844,853) Public Works 2,431,627 35,142 141,573 1,095,082 (1,159,830) - (1,159,830) Sanitation 476,404 508,780 31,721 - 64,097 - 64,097 Culture and Recreation 922,706 630,918 438,611 - 146,823 - 146,823 Interest and Fiscal Charges 108,818 - - - (108,818) - (108,818) Total Governmental Activities7,770,087 1,948,523 698,238 1,225,082 (3,898,244) - (3,898,244) Business-Type Activities:Water 1,968,973 1,955,504 - 56,771 - 43,302 43,302 Sewer 1,616,403 1,656,428 - 312,431 - 352,456 352,456 Total Business-Type Activities 3,585,376 3,611,932 - 369,202 - 395,758 395,758 Total Primary Government 11,355,463$ 5,560,455$ 698,238$ 1,594,284$ (3,898,244) 395,758 (3,502,486) General Revenues:Property Taxes, Levied for General Purposes 3,997,591 - 3,997,591 Tax Increments 466,344 - 466,344 Grants and Contributions Not Restricted 1,070,717 - 1,070,717 Unrestricted Investment Earnings(301,608) 1,557 (300,051) Other 576,214 4,044 580,258 Gain on Sale of Capital Assets 51,951 - 51,951 Transfers 375,000 (375,000) - Total General Revenues, Special Items, and Transfers 6,236,209 (369,399) 5,866,810 Change in Net Position 2,337,965 26,359 2,364,324 Net Position - Beginning of Year 45,881,556 10,188,046 56,069,602 Net Position - End of Year 48,219,521$ 10,214,405$ 58,433,926$ Program Revenues Net (Expense) Revenue and Changes in Net PositionPrimary Government THIS PAGE INTENTIONALLY LEFT BLANK CITY OF LITTLE CANADA, MINNESOTA BALANCE SHEET GOVERNMENTAL FUNDS DECEMBER 31, 2022 See accompanying Notes to Basic Financial Statements. (27) General Total General Economic Capital Infrastructure Other Governmental Fund Development Improvements CIP Governmental Activities (101) (105)(400)(450) Funds 2022 ASSETS Cash and Investments 3,107,587$ 741,621$ 4,154,499$ 2,493,013$ 6,819,297$ 17,316,017$ Interfund Loan Receivable 551,577 - - - 33,770 585,347 Accrued Interest Receivable 39,595 - - - - 39,595 Accounts (Net of Allowance) 9,199 - 470,994 109,303 237,834 827,330 Due from Other Governmental Units 39,659 - 126,257 168,632 - 334,548 Property Taxes Receivable: Delinquent 62,246 - - 1,552 - 63,798 Due from County 10,586 - - 372 6,610 17,568 Delinquent Tax Increment - - - - 487 487 Special Assessments Receivable Deferred - - - 1,625,356 447,429 2,072,785 Delinquent - - - - 9,178 9,178 Special Deferred - - - - - - Prepaid Items 23,052 - - - 675,449 698,501 Property Held for Resale - 2,800 - - 701,015 703,815 Total Assets 3,843,501$ 744,421$ 4,751,750$ 4,398,228$ 8,931,069$ 22,668,969$ LIABILITIES, DEFERRED INFLOWS OF RESOURCES, AND FUND BALANCE LIABILITIES Accounts and Contracts Payable 49,246$ -$ 30,382$ 324,241$ 72,298$ 476,167$ Accrued Salaries Payable 11,811 - - - - 11,811 Interfund Loan Payable - - - - 585,347 585,347 Due to Other Governmental Units 11,385 - - - 28,284 39,669 Deposits 94,214 - - - - 94,214 Unearned Revenue 90 - 640,805 - 4,351 645,246 Total Liabilities 166,746 - 671,187 324,241 690,280 1,852,454 DEFERRED INFLOWS OF RESOURCES Unavailable Revenue - Taxes 62,246 - - 1,552 6,610 70,408 Unavailable Revenue - Special Assessments - - - 1,625,356 456,607 2,081,963 Unavailable Revenue - Other - - 470,994 - - 470,994 Total Deferred Inflows of Resources 62,246 - 470,994 1,626,908 463,217 2,623,365 FUND BALANCE Nonspendable 574,629 - - - - 574,629 Restricted - - 78,000 - 3,010,726 3,088,726 Committed - 744,421 - - 720,334 1,464,755 Assigned - - 3,531,569 2,447,079 4,430,385 10,409,033 Unassigned 3,039,880 - - (383,873) 2,656,007 Total Fund Balance 3,614,509 744,421 3,609,569 2,447,079 7,777,572 18,193,150 Total Liabilities, Deferred Inflows of Resources, and Fund Balance 3,843,501$ 744,421$ 4,751,750$ 4,398,228$ 8,931,069$ 22,668,969$ CITY OF LITTLE CANADA, MINNESOTA RECONCILIATION OF THE BALANCE SHEET TO THE STATEMENT OF NET POSITION GOVERNMENTAL ACTIVITIES DECEMBER 31, 2022 See accompanying Notes to Basic Financial Statements. (28) 2022 Total Fund Balances for Governmental Funds 18,193,150$ Land 3,620,111$ Construction in Progress 671,484 Buildings and Building Improvements 7,676,257 Improvements Other than Buildings 1,798,893 Streets and Infrastructure 46,836,550 Equipment and Furniture 6,055,039 Total Capital Assets 66,658,334 Less: Accumulated Depreciation (35,652,276) 31,006,058 2,623,365 (34,914) (921,882) (13,597) 316,342 (619,137) 22,293 Bonds Payable (2,815,000) Notes Payable (18,093) Unamortized Premiums (15,864) Compensated Absence Payable (122,337) (2,971,294) Total Net Position of Governmental Activities 48,219,521$ The Cityૃs net pension liability and related deferred inflows and deferred outflows are recorded only on the statement of net position. Balance at year-end are: Total net position reported for governmental activities in the statement of net position is different because: Capital assets used in governmental funds are not financial resources and, therefore, are not reported in the funds. Those assets consist of: Some of the Cityૃs receivables (including property taxes, special assessments and other long-term receivables) will be collected after year-end, but are not available soon enough to pay for the current period's expenditures and, therefore, are reported as deferred inflows of resources in the governmental funds. Interest on long-term debt is not accrued in governmental funds, but rather is recognized as an expenditure when due. Accrued interest for general obligation bonds is included in the statement of net position. Net Pension Liability Deferred Inflows of Resources - Pensions Deferred Outflows of Resources - Pensions Long-term liabilities that pertain to governmental funds, including bonds payable, are not due and payable in the current period and, therefore, are not reported as fund liabilities. All liabilities - both current and long term - are reported in the statement of net position. Internal service funds are used by management to charge the cost of insurance to individual funds. The assets and liabilities are included in the governmental statement of net position. CITY OF LITTLE CANADA, MINNESOTA STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES GOVERNMENTAL FUNDS YEAR ENDED DECEMBER 31, 2022 See accompanying Notes to Basic Financial Statements. (29) General Total Economic Capital Infrastructure Other Governmental General Development Improvements CIP Governmental Activities Fund (105)(400)(450)Funds 2022 REVENUE Property Taxes 3,471,385$ -$ 11,890$ 121,473$ 159,048$ 3,763,796$ Franchise Tax - - - 358,954 110,088 469,042 Tax Increment Collections - - 23,861 - 703,636 727,497 Special Assessments 75 - - 466,222 337,100 803,397 Licenses and Permits 562,379 - - - - 562,379 Intergovernmental Revenue 335,920 - 980,952 205,784 - 1,522,656 Charges for Services 26,345 - - 300 587,000 613,645 Fines and Forfeitures 45,911 - - - - 45,911 Investment Earnings (35,498) (2,445) (75,402) (64,838) (123,425) (301,608) Connection Charges - - - - - - Contributions - - - - 262,126 262,126 Donations 167,418 - - - 37,266 204,684 Miscellaneous Revenue 11,462 46,599 472,774 30,158 3,026 564,019 Total Revenue 4,585,397 44,154 1,414,075 1,118,053 2,075,865 9,237,544 EXPENDITURES Current: General Government 655,924 - 550 1,850 29,778 688,102 Housing and Economic Development - - - - 271,771 271,771 Public Safety 2,527,832 - - - - 2,527,832 Public Works 521,484 - - 17,158 28,759 567,401 Sanitation and Recycling - - - - 476,404 476,404 Parks and Recreation 557,275 - - - 139,597 696,872 Capital Outlay:- General Government - - 26,985 - - 26,985 Public Safety - - - - - - Public Works - - 113,548 2,007,917 345,291 2,466,756 Parks and Recreation - - 868,116 - - 868,116 Debt Service: Principal Retirement - - - - 308,549 308,549 Interest and Fiscal Charges - 2,545 - - 101,384 103,929 Fiscal Charges - - - - 950 950 Miscellaneous - - - 995 995 Total Expenditures 4,262,515 2,545 1,009,199 2,026,925 1,703,478 9,004,662 EXCESS (DEFICIENCY) OF REVENUE OVER (UNDER) EXPENDITURES 322,882 41,609 404,876 (908,872) 372,387 232,882 OTHER FINANCE SOURCES (USES) Transfers In 89,763 672,836 14,300 - 1,846,783 2,623,682 Transfers Out - - - (14,300) (2,234,382) (2,248,682) Proceeds from Sale of Capital Assets - - 498,543 - - 498,543 Total Other Finance Sources (Uses)89,763 672,836 512,843 (14,300) (387,599) 873,543 NET CHANGE IN FUND BALANCES 412,645 714,445 917,719 (923,172) (15,212) 1,106,425 FUND BALANCES Beginning of Year 3,201,864 29,976 2,691,850 3,370,251 7,792,784 17,086,725 End of Year 3,614,509$ 744,421$ 3,609,569$ 2,447,079$ 7,777,572$ 18,193,150$ CITY OF LITTLE CANADA, MINNESOTA RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES TO THE STATEMENT OF ACTIVITIES GOVERNMENTAL ACTIVITIES YEAR ENDED DECEMBER 31, 2022 See accompanying Notes to Basic Financial Statements. (30) 2022 Net Change in Fund Balances-Total Governmental Funds 1,106,425$ v Capital Outlays - Improvement Costs 2,997,253$ Gain (Loss) on Disposal of Capital Assets 51,951 Proceeds from the Sale of Capital Assets (51,951) Depreciation Expense (1,969,594) 1,027,659 Amortization of Bond Premium 10,358 Repayment of Notes Payable 7,189 Repayment of Bond Principal 285,000 Change in Accrued Interest Expense 2,665 305,212 Deferred Inflows of Resources - December 31, 2022 2,623,365 Deferred Inflows of Resources - December 31, 2021 2,626,400 (3,035) (89,491) (2,378) (6,427) Change in Net Position of Governmental Activities 2,337,965$ Pension expenditures in the governmental funds are measured by current year employee contributions. Pension expenses on the statement of activities are measured by the change in net pension liability and the related deferred inflows and outflows of resources. In the statement of activities, compensated absences and other postemployment benefits are measured by the amounts earned during the year. In the governmental funds, however, expenditures for these items are measured by the amount of financial resources used (essentially, the amounts actually paid). During fiscal year 2017, compensated absence payable and other post employment benefits payable changed. Amounts reported for governmental activities in the statement of activities are different because: Governmental funds report capital outlays as expenditures and proceeds from the sale of capital assets as revenues. However, in the statement of activities, assets are capitalized and the cost is allocated over their estimated useful lives and reported as depreciation expense. This is the amount by which depreciation exceeded capital outlays in the current period. The governmental funds report bond proceeds as financing sources, while repayment of bond principal is reported as an expenditure. In the statement of net position, however, issuing debt increases long-term liabilities and does not affect the statement of activities and repayment of principal reduces the liability. Interest is recognized as an expenditure in the governmental funds when it is due. In the statement of activities, however, interest expense is recognized as it accrues, regardless of when it is due. The net effect of these differences in the treatment of general obligation bonds and related items is as follows: Delinquent and certain other property taxes and special assessments receivable will be collected subsequent to year-end, but are not available soon enough to pay for the current period’s expenditures and, therefore, are reported as deferred inflows of resources and excluded from revenues in the governmental funds. Internal service funds are used by management to charge the cost of insurance to individual funds. This amount is net revenue (loss) attributable to internal governmental activities. CITY OF LITTLE CANADA, MINNESOTA STATEMENT OF NET POSITION PROPRIETARY FUNDS DECEMBER 31, 2022 See accompanying Notes to Basic Financial Statements. (31) Governmental Activities- Insurance Water Sewer 2022 Internal Service (601)(602/603)Totals Fund (700) ASSETS AND DEFERRED OUTFLOWS OF RESOURCES CURRENT ASSETS Cash and Cash Equivalents 946,166$ 1,139,133$ 2,085,299$ 34,645$ Receivables: General Customers 397,229 480,477 877,706 - Other 12,939 - 12,939 - Leases 1,557,028 - 1,557,028 - Due from Other Governmental Units: Certified to County 25,962 22,169 48,131 - Prepaids 11,953 101,853 113,806 10,641 Total Current Assets 2,951,277 1,743,632 4,694,909 45,286 CAPITAL ASSETS Permanent Easements - 103,301 103,301 - Construction 4,672 - 4,672 - Equipment 564,439 691,003 1,255,442 - Mains and Systems 10,916,899 8,201,614 19,118,513 - Total 11,486,010 8,995,918 20,481,928 - Less: Accumulated Depreciation (7,672,097) (5,213,540) (12,885,637) - Net Capital Assets 3,813,913 3,782,378 7,596,291 - DEFERRED OUTFLOWS OF RESOURCES Deferred Outflows - Pensions 94,016 95,144 189,160 - Total Assets and Deferred Outflows of Resources 6,859,206$ 5,621,154$ 12,480,360$ 45,286$ LIABILITIES, DEFERRED INFLOWS OF RESOURCES, AND NET POSITION CURRENT LIABILITIES Accounts Payable 9,915$ 52,454$ 62,369$ 485$ Due to Other Governmental Units 79,820 - 79,820 - Compensated Absences Payable 17,326 17,754 35,080 - Total Current Liabilities 107,061 70,208 177,269 485 NONCURRENT LIABILITIES Compensated Absences Payable 24,495 25,005 49,500 - Net Pension Liability 273,980 277,265 551,245 - Total Noncurrent Liabilities 298,475 302,270 600,745 - Total Liabilities 405,536 372,478 778,014 485 DEFERRED INFLOWS OF RESOURCES Deferred Inflows - Pensions 4,041 4,090 8,131 - Deferred Inflows - Leases 1,502,318 - 1,502,318 - Total Deferred Inflows 1,506,359 4,090 1,510,449 - NET POSITION Net Investment in Capital Assets 3,813,913 3,782,378 7,596,291 - Unrestricted 1,133,398 1,462,208 2,595,606 44,801 Total Net Position 4,947,311 5,244,586 10,191,897 44,801 Total Liabilities, Deferred Inflows of Resources, and Net Position 6,859,206$ 5,621,154$ 12,480,360$ 45,286$ Adjutsment to reflect the consolidation of internal services fund activities to related enterprise funds 22,508 Total net position of business-type activities 10,214,405 Business-Type Activities CITY OF LITTLE CANADA, MINNESOTA STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN NET POSITION PROPRIETARY FUNDS YEAR ENDED DECEMBER 31, 2022 See accompanying Notes to Basic Financial Statements. (32) Governmental Activities- Insurance Water Sewer 2022 Internal Service (601) (602/603) Totals Fund (700) OPERATING REVENUE General Customers 1,851,568$ 1,656,428$ 3,507,996$ 292,455$ Other 1,538 - 1,538 - Meter Sales 10,129 - 10,129 - Total Operating Revenue 1,863,235 1,656,428 3,519,663 292,455 OPERATING EXPENSES Personnel Services 358,902 363,921 722,823 169,966 MCES - Sewer Service Charge - 933,746 933,746 - Purchased Water 1,171,127 - 1,171,127 - Supplies, Services, and Other Charges 184,752 158,758 343,510 - Insurance and Claims - - - 127,334 Depreciation 252,963 158,741 411,704 - Total Operating Expenses 1,967,744 1,615,166 3,582,910 297,300 OPERATING Income (LOSS)(104,509) 41,262 (63,247) (4,845) NONOPERATING REVENUE Investment Earnings 28,798 (27,241) 1,557 - Rental of City Property 92,269 - 92,269 - Miscellaneous Revenue 892 3,152 4,044 - Total Nonoperating Revenue 121,959 (24,089) 97,870 - INCOME (LOSS) BEFORE TRANSFERS AND CAPITAL CONTRIBUTIONS 17,450 17,173 34,623 (4,845) Transfers Out (225,000) (150,000) (375,000) - Capital Contributions 56,771 312,431 369,202 - CHANGES IN NET POSITION (150,779) 179,604 28,825 (4,845) NET POSITION Beginning of Year 5,098,090 5,064,982 10,163,072 49,646 End of Year 4,947,311$ 5,244,586$ 10,191,897$ 44,801$ Adjutsment to reflect the consolidation of internal services fund activities to related enterprise funds (2,466) Change in net position of business-type activities 26,359 Business-Type Activities CITY OF LITTLE CANADA, MINNESOTA STATEMENT OF CASH FLOWS PROPRIETARY FUNDS YEAR ENDED DECEMBER 31, 2022 See accompanying Notes to Basic Financial Statements. (33) Water Sewer Total CASH FLOWS FROM OPERATING ACTIVITIES Cash Receipts from Customers 1,861,810$ 1,643,913$ 3,505,723$ Cash Paid to Suppliers (1,356,173) (1,111,995) (2,468,168) Cash Paid to Employees (348,910) (353,114) (702,024) Other Receipts (Payments) 892 - 892 Net Cash Provided by Operating Activities 157,619 178,804 336,423 CASH FLOWS FROM NONCAPITAL AND RELATED FINANCING ACTIVITIES Transfers to/from Other Funds (225,000) (150,000) (375,000) CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Acquisition of Capital Assets - - - Lease Payments Received 37,559 - 37,559 Net Cash Provided by Capital and Related Financing Activities 37,559 - 37,559 CASH FLOWS FROM INVESTING ACTIVITIES Interest Received on Investments 28,798 (27,241) 1,557 NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (1,024) 1,563 539 Cash and Cash Equivalents - Beginning of the Year 947,190 1,137,570 2,084,760 CASH AND CASH EQUIVALENTS - END OF THE YEAR 946,166$ 1,139,133$ 2,085,299$ RECONCILIATION OF OPERATING LOSS TO NET CASH PROVIDED BY OPERATING ACTIVITIES Operating Income (Loss) (104,509)$ 41,262$ (63,247)$ Adjustments to Operating Income (Loss) to Net Cash Provided by Operating Activities: Depreciation 252,963 158,741 411,704 Miscellaneous Revenue 892 3,152 4,044 Change in Assets, Deferred Outflows of Resources, Liabilities, and Deferred Inflows of Resources: (Increase) Decrease in: Accounts Receivable 693 (20,475) (19,782) Prepaid Items (11,773) (24,041) (35,814) Due from Other Governmental Units (2,118) 4,808 2,690 Deferred Outflows of Resources - Pensions 23,351 23,234 46,585 Increase (Decrease) in: Accounts Payable 5,867 - 5,867 Due to Other Governmental Units 5,612 4,550 10,162 Compensated Absences Payable 1,095 1,216 2,311 Net Pension Liability 123,807 125,796 249,603 Deferred Inflows of Resources - Pensions (138,261) (139,439) (277,700) Net Cash Provided by Operating Activities 157,619$ 178,804$ 336,423$ NONCASH TRANSACTIONS Capital Contribution from Governmental Activities 56,771$ 312,431$ 369,202$ Business-Type Activities - Enterprise Funds CITY OF LITTLE CANADA, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2022 (34) NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES A. Organization The City of Little Canada, Minnesota (the City) operates under the “Optional Plan A” form of government as defined in Minnesota Statutes. Under this plan, the City Council, composed of an elected mayor and four elected trustees or council members, exercises legislative authority and determines all matters of policy. The City Council appoints personnel responsible for the proper administration of all the affairs relating to the City. The financial statements and the accounting policies of the City conform to accounting principles generally accepted in the United States of America (GAAP) as applicable to governmental units. The Governmental Accounting Standards Board (GASB) is the accepted standard setting body for establishing governmental accounting and financial reporting principles. B. Reporting Entity As required by GAAP, these financial statements include the City (the primary government) and any component units. A component unit is a legally separate entity for which the primary government is financially accountable, or for which the exclusion of the component unit would render the financial statements of the primary government misleading. The criteria used to determine if the primary government is financially accountable for a component unit includes whether or not the primary government appoints the voting majority of the potential component unit’s board, is able to impose its will on the potential component unit, is in a relationship of financial benefit or burden with the potential component unit, or is fiscally depended upon by the potential component unit. The Little Canada Economic Development Authority (EDA) is a legally separate entity created to provide financing for economic development within the City of Little Canada. The governing board of the EDA is appointed by the City council and is substantially the same as the City Council. There is also a financially beneficial relationship between the EDA and the City. For these reasons the EDA has been included in the financial statements as a blended component unit, with its funds reports as though they are funds of the City. The EDA does not prepare separate financial statements. There are no other organizations that, when considered, would be included in the financial statements as a component unit. CITY OF LITTLE CANADA, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2022 (35) NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) C. Government-Wide and Fund Financial Statements The government-wide financial statements (statement of net position and statement of activities) display information about the reporting government as a whole. These statements include all of the financial activities of the City, except fiduciary funds. Since, by definition, fiduciary fund assets are held for the benefit of a third party and cannot be used for activities or obligations of the City, these funds are excluded from the government-wide financial statements. Governmental activities, which normally are supported by taxes and intergovernmental revenues, are reported separately from business-type activities, which rely to a significant extent on sales, fees, and charges for support. The statement of activities demonstrates the degree to which the direct expenses of a given function or segment is offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or segment. Program revenues include: 1) charges to customers or applicants who purchase, use, or directly benefit from goods, services, or privileges provided by a given function or segment, 2) operating grants and contributions, and 3) capital grants and contributions, including special assessments that are restricted to meeting the operational or capital requirements of a particular function or segment. Taxes and other internally directed revenues are reported as general revenues. The government-wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. Property taxes and special assessments are recognized as revenues in the fiscal year for which they are levied. Grants and similar items are recognized when all eligibility requirements imposed by the provider have been met. As a general rule, the effect of interfund activity has been eliminated from the government-wide financial statements. However, charges between the City’s enterprise funds and other functions are not eliminated, as that would distort the direct costs and program revenues reported in those functions. The City applies restricted resources first when an expense is incurred for which both restricted and unrestricted resources are available. Depreciation expense can be specifically identified by function (see Note 5). Interest on long-term debt is considered an indirect expense and is reported separately on the statement of activities. CITY OF LITTLE CANADA, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2022 (36) NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) D. Fund Financial Statement Presentation Separate fund financial statements are provided for governmental, proprietary, and fiduciary funds. Major individual governmental and enterprise funds are reported as separate columns in the fund financial statements. Aggregated information for the remaining nonmajor governmental funds is reported in a single column in the fund financial statements. Governmental fund financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Revenue is recognized when it becomes measurable and available. “Measurable” means the amount of the transaction can be determined and “available” means collectible within the current period or soon enough thereafter to be used to pay liabilities of the current period. For this purpose, the City considers revenues to be available if collected within 60 days after year-end. Major revenue that is susceptible to accrual includes property taxes, intergovernmental revenue, charges for services, and interest earned on investments. Only the portion of special assessments receivable due within the current fiscal period is considered to be susceptible to accrual as revenue of the current period. Revenue that is not susceptible to accrual includes licenses and permits, fees, and miscellaneous revenue. Such revenue is recorded only when received because it is not measurable until collected. Grants and similar items are recognized when all eligibility requirements imposed by the provider have been met. Expenditures are generally recorded when a liability is incurred, except for principal and interest on long-term debt and compensated absences, which are recognized as expenditures to the extent they have matured. Capital asset acquisitions are reported as capital outlay expenditures in the governmental funds. Proceeds of long-term debt and acquisitions under capital leases are reported as other financing sources. Proprietary fund financial statements are reported using the economic resources measurement focus and accrual basis of accounting, similar to the government-wide financial statements. Proprietary funds distinguish operating revenues and expenses from nonoperating items. Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund’s principal ongoing operations. The principal operating revenues of the City’s enterprise funds are charges to customers for sales and services. The operating expenses for the enterprise funds include the cost of sales and services, administrative expenses, and depreciation on capital assets. All revenues and expenses not meeting this definition are reported as nonoperating revenues and expenses. CITY OF LITTLE CANADA, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2022 (37) NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) D. Fund Financial Statement Presentation (Continued) Description of Funds The City reports the following major governmental funds: General Fund – This is the general operating fund of the City. It is used to account for all financial resources except those required to be accounted for in another fund. Economic Development Fund – This fund is used to account for amounts received and spent on community development activities. General Capital Improvements Fund – This fund is used to account for project costs and the related financing for the Rice Street/Little Canada Road redevelopment project. Infrastructure CIP Capital Project Fund – This fund is used to account for accumulating reserve balances as bond issues are fully redeemed. The City reports the following major enterprise funds: Water Operating Fund – This fund is used to account for the provision of water services to the residents and business of the City. Sewer Operating Fund – This fund is used to account for the provision of sewer services to the residents and business of the City. Additionally, the City reports the following fund type: Internal Service Fund – This fund is used to account for the City’s insurance fund. CITY OF LITTLE CANADA, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2022 (38) NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) E. Budgets Budgets are adopted on a basis consistent with GAAP. Annual appropriated budgets are adopted for the General and all Special Revenue Funds. Budgeted expenditure appropriations lapse at year-end. Encumbrance accounting, under which purchase orders, contracts, and other commitments for the expenditure of monies are recorded in order to reserve that portion of the appropriation, is not employed by the City because it is, at present, not considered necessary to assure effective budgetary control or facilitate effective cash management. The City follows these procedures in establishing the budgetary data reflected in the financial statements: 1. The City Administrator submits to the City Council a proposed operating budget for the fiscal year commencing the following January 1. The operating budget includes proposed expenditures and the means of financing them. 2. Public hearings are conducted to obtain taxpayer comments. 3. The budget is legally enacted through passage of a resolution on a departmental basis and can be expended by each department based upon detailed budget estimates for individual expenditure accounts. 4. The City Administrator is authorized to transfer appropriations within any department budget. Additional interdepartmental or interfund appropriations and deletions are or may be authorized by the City Council with fund (contingency) reserves or additional revenues. 5. Formal budgetary integration is employed as a management control device during the year for the General Fund and Special Revenue Funds. 6. Legal debt obligation indentures determine the appropriation level and debt service tax levies for the Debt Service Funds. Supplementary budgets are adopted for the Proprietary Funds to determine and calculate user charges. These Debt Service and Proprietary budget amounts represent general obligation bond indenture provisions and net income for operation and capital maintenance and are not reflected in the financial statements. 7. A capital improvement program is reviewed annually by the City Council for the Capital Project Funds. However, appropriations for major improvement projects (subject to statutory purchasing requirements) are not adopted until the actual bid award of the improvement. The appropriations are not reflected in the financial statements. 8. Expenditures may not legally exceed budgeted appropriations at the total fund level. Monitoring of budgets is maintained at the expenditure category level (i.e., salaries, wages and benefits, supplies, services, capital outlay) within each activity. 9. The City Council may authorize the transfer of budgeted amounts between City funds. CITY OF LITTLE CANADA, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2022 (39) NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) F. Cash and Investments Cash and investment balances of the primary government and component unit are pooled and invested, to the extent available, in authorized investments. Investment income is allocated to individual funds on the basis of the fund’s equity in the cash and investment pool. The City provides temporary advances to funds that have insufficient cash balances by means of an advance from another fund shown as interfund receivables in the advancing fund, and an interfund payable in the fund with the deficit, until adequate resources are received. These interfund balances are eliminated on the government- wide financial statements. Investments are stated at their fair value as determined by quoted market prices, except for money market investments and participating interest-earning investment contracts that have a remaining maturity at time of purchase of one year or less which are recorded at amortized cost, provided that the fair value of those investments is not significantly affected by the impairment of the credit standing of the issuer or by other factors. Money market investments are short-term, highly liquid debt instruments including commercial paper, banker’s acceptances, and U.S. Treasury and agency obligations. Investments in external investment pools that meet the criteria of GASB Statement No. 70 are valued at amortized cost. If any external investment pool does not meet the criteria established by this Statement, that pool should apply the provisions in paragraph 16 of Statement No. 31. For purposes of the statement of cash flows, the City considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents. All of the cash and investments allocated to the Proprietary Funds have original maturities of 90 days or less. Therefore the entire balance in the Proprietary Funds is considered cash equivalents. G. Receivables All miscellaneous accounts receivable are shown at net of an allowance for doubtful accounts. Since the City is generally able to certify delinquent utility bills to the county for collection as special assessments, no allowance for uncollectible accounts has been provided on those receivables. Receivables not expected to be collected within one year include delinquent taxes, special assessments, and certain amounts due from other governmental units. Any such receivables that are not considered to be available to finance current expenditures are offset by a deferred inflow of resources in the governmental fund financial statements. CITY OF LITTLE CANADA, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2022 (40) NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) H. Property Taxes The City Council annually adopts a tax levy and certifies it to the County in December (levy/assessment date) of each year for collection in the following year. The county spreads levies over all taxable property in the City and is responsible for billing and collecting all property taxes for itself, the City, the local School District and other taxing authorities. Such taxes become a lien on January 1 and are recorded as receivables by the City on that date. Real property taxes may be paid by taxpayers in two equal installments on May 15 and October 15. Personal property taxes are due in full on May 15. The county provides tax settlements to cities and other taxing districts three times a year. Revenues are generally accrued and recognized in the year collectible. Taxes which remain unpaid at December 31 are classified as delinquent taxes receivable. The City has no ability to enforce payment of property taxes by property owners, the County possesses this authority. In the government-wide financial statements the City recognizes property tax revenue in the period for which taxes were levied. Uncollectible property taxes are not material and have not been reported. In the governmental fund financial statements the City recognizes current and delinquent taxes received by the City in July, December, and January as revenue for the current year. Taxes collected by the County by December 31 (remitted to the City the following January) are classified as taxes due from the County. The portion of taxes not received by the City by January is classified as delinquent and is fully offset by deferred inflows of resources. I. Special Assessments Special assessments are levied against the benefited properties for the cost or a portion of the cost of special assessment improvement projects in accordance with state statutes. These assessments are collectible by the City over a term of years usually consistent with the term of the related bond issue. Collection of annual installments (including interest) is handled by the County auditor in the same manner as property taxes. Property owners are allowed to (and often do) prepay future installments without interest or prepayment penalties. Once a special assessment roll is adopted, the amount attributed to each parcel is a lien upon that property until full payment is made or the amount is determined to be excessive by the City Council or court action. If special assessments are allowed to go delinquent, the property is subject to tax forfeit sale. Proceeds of sales from tax forfeit properties are remitted to the City in payment of delinquent special assessments. Pursuant to State Statutes, a property shall be subject to a tax forfeit sale after three years unless it is homesteaded, agricultural or seasons recreational land in which event the property is subject to such sale after five years. CITY OF LITTLE CANADA, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2022 (41) NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) I. Special Assessments (Continued) In the governmental-wide financial statements the City recognizes special assessment revenue in the period that the assessment roll was adopted by the City Council. In the fund financial statements current and delinquent special assessments received by the City are recognized as revenue for the current year. All remaining delinquent and deferred special assessments receivable are offset by deferred inflows of resources in the governmental funds. J. Inventories The original cost of materials and supplies has been recorded as expenditures at the time of purchase. The City does not maintain material amounts of inventories of goods and supplies. K. Prepaid Items Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid items in both government-wide and fund financial statements. Prepaid items are reported using the consumption method and recorded as expenditures/expenses at the time of consumption. L. Capital Assets Capital assets, which include land, buildings, improvements, equipment, infrastructure (utility systems, roads, bridges, sidewalks, and similar items), and intangible assets such as easements are reported in the applicable governmental or business-type activities columns in the government-wide financial statements. Such assets are capitalized at historical cost, or estimated historical cost for assets where actual historical cost is not available. Donated assets are recorded as capital assets at their acquisition value at the date of donation. The City defines capital assets as those with an initial, individual cost of $5,000 with an estimated useful life in excess of one year. The cost of normal maintenance and repairs that do not add to the value of the asset or materially extend asset lives are not capitalized. In the case of the initial capitalization of general infrastructure (those reported by governmental activities) the City chose to include all such items, regardless of their acquisition date or amount. The City was able to estimate the historical cost for the initial reporting of these assets through back-trending (i.e. estimating the current replacement cost of the infrastructure to be capitalized and using an appropriate price-level index to deflate the cost of the infrastructure to the acquisition year or estimated acquisition year). Capital assets are recorded in the government-wide and proprietary fund financial statements, but are not reported in the governmental fund financial statements. CITY OF LITTLE CANADA, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2022 (42) NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) L. Capital Assets (Continued) Capital assets are depreciated using the straight-line method over their estimated useful lives. Land and construction in progress are not depreciated. The estimated useful lives are as follows: Buildings 40 Years Other Improvements 5 to 25 Years Machinery and Equipment 5 to 15 Years Infrastructure – Streets 25 Years Infrastructure – Water and Sewer 50 Years M. Compensated Absences Payable It is the City’s policy to permit employees to accumulate earned by unused vacation and sick pay benefits. All vacation pay is accrued when incurred in the government-wide and proprietary fund financial statements. For the governmental activities, compensated absences are generally liquidated by the General Fund. A liability for these amounts is reported in governmental funds only if they have matured, for example, as a result of employee resignations and retirements. N. Long-Term Obligations In the government-wide and proprietary fund financial statements, long-term debt and other long-term obligations are reported as liabilities. Bond premiums and discounts, if material, are amortized over the life of the bonds using the straight-line method. Bond issuance costs are expensed as incurred. In the governmental fund financial statements, long-term debt and other long-term obligations are not reported as liabilities. The face amount of debt issued is reported as other financing sources. Premiums or discounts on debt issuances are reported as other financing sources or uses, respectively. Issuance costs, whether or not withheld from the actual debt proceeds received, are reported as debt service expenditures. O. Net Pension Liability For purposes of measuring the net pension liability, deferred outflows/inflows of resources, and pension expense, information about the fiduciary net position of the Public Employees Retirement Association (PERA) and additions to/deductions from PERA’s fiduciary net position have been determined on the same basis as they are reported by PERA. For this purpose, plan contributions are recognized as of employer payroll paid dates and benefit payments, and refunds are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value. CITY OF LITTLE CANADA, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2022 (43) NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) P. Net Position/Fund Balance Net position represents the difference between assets, deferred outflows of resources, liabilities, and deferred inflows of resources in the government-wide and proprietary fund financial statements. Net investment in capital assets consists of capital assets, net of accumulated depreciation, reduced by the outstanding balance of any long-term debt used to build or acquire the capital assets. Portions of net position are reported as restricted when there are limitations imposed on their use through external restrictions imposed by creditors, grantors, or laws or regulations. In the fund financial statements, governmental funds report fund balances in the classifications that disclose constraints for which amounts in those funds can be spent. These classifications are as follows: Nonspendable – portion of fund balances related to prepaids, inventories, long-term receivables, and corpus on any permanent fund. Restricted – funds are constrained from outside parties (statute, grantors, bond agreements, etc.). Committed – funds are established and modified by a resolution approved by the City Council. Assigned – consists of internally imposed constraints. The City adopted a formal fund balance policy which gives authority to assign fund balances to the Finance Director and/or City Administrator. Unassigned – is the residual classification for the General Fund and also reflects the negative residual amounts in other funds. When both restricted and unrestricted fund balance is available for use, it is the City’s policy to use restricted first, then unrestricted fund balance. When committed, assigned, or unassigned amounts are available for use, it is the City’s policy to use committed first, than assigned, and finally unassigned amounts. Q. Interfund Transactions Interfund services provided and used are accounted for as revenues, expenditures, or expenses. Transactions that constitute reimbursements to a fund for expenditures/ expenses initially made from it that are properly applicable to another fund, are recorded as expenditures/expenses in the reimbursing fund and as reductions of expenditures/expenses in the fund that is reimbursed. Interfund loans are reported as an interfund loan receivable or payable which offsets the movement of cash between funds. All other interfund transactions are reported as transfers. CITY OF LITTLE CANADA, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2022 (44) NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) R. Risk Management The City is exposed to various risks of loss related to torts: theft of, damage to, and destruction of assets; errors and omissions; and natural disasters. The City participates in the League of Minnesota Cities Insurance Trust (LMCIT), a public entity risk pool for its general property and casualty, workers’ compensation, and other miscellaneous insurance coverages. LMCIT operates as a common risk management and insurance program for a large number of cities in Minnesota. The City pays an annual premium to LMCIT for insurance coverage. The LMCIT agreement provides that the trust will be self- sustaining through member premiums and will reinsure through commercial companies for claims in excess of certain limits. Settled claims resulting from these risks have not exceeded insurance coverage in any of the past three fiscal years. There were no significant reductions in insurance coverage in 2022. S. Deferred Outflows and Inflows of Resources In addition to assets, the statements of financial position will sometimes report a separate section for deferred outflows of resources. This separate financial statement element represents a consumption of net assts that applies to a future period(s) and so will not be recognized as an outflow of resources (expense/expenditure) until that time. The City has one type of item, deferred outflows related to pensions, which qualifies for reporting in this category. See Note 8 for additional detail. In addition to liabilities, statements of financial position or balance sheets will sometimes report a separate section for deferred inflows of resources. This separate financial statement element represents an acquisition of net assets that applies to future periods and so will not be recognized as an inflow of resources (revenue) until that time. The City has two types of items which qualify for reporting in this category. The first, unavailable revenues, arises under a modified accrual basis of accounting and therefore is reported only in the governmental funds balance sheet. The governmental funds report unavailable revenue from three sources: property taxes, special assessments, and amounts due from other governments not collected within 60 days of year-end. These amounts are deferred and recognized as an inflow of resources in the period the amounts become available. The City also reports deferred inflows related to pensions on its statement of net position. See Note 8 for additional detail. T. Leases The City determines if an arrangement is a lease at inception. Lessee leases are included in right-to-use lease assets (lease assets) and lease liabilities in the statement of net position. Lessor leases are included in lease receivables and deferred inflow of resources in the statement of net position and fund financial statements. Lease receivables represent the City’s claim to receive lease payments over the lease term, as specified in the contract, in an exchange or exchange-like transaction. Lease receivables are recognized at commencement date based on the present value of expected lease payments over the lease term, reduced by any provision for estimated uncollectible amounts. Interest revenue is recognized ratably over the contract term. CITY OF LITTLE CANADA, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2022 (45) NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) T. Leases (Continued) Deferred inflows of resources related to leases are recognized at the commencement date based on the initial measurement of the lease receivable, plus any payments received from the lessee at or before the commencement of the lease term that relate to future periods, less any lease incentives paid to, or on behalf of, the lessee at or before the commencement of the lease term. The deferred inflows related to leases are recognized as lease revenue in a systematic and rational manner over the lease term. Lease assets represent the City’s control of the right to use an underlying asset for the lease term, as specified in the contract, in an exchange or exchange-like transaction. Lease assets are recognized at the commencement date based on the initial measurement of the lease liability, plus any payments made to the lessor at or before the commencement of the lease term and certain direct costs. Lease assets are amortized in a systematic and rational matter over the shorter of the lease term or the useful life of the underlying asset. Lease liabilities represent the City’s obligation to make lease payments arising from the lease. Lease liabilities are recognized at the commencement date based on the net present value of expected lease payments over the lease term, less any lease incentives. Interest expense is recognized ratably over the contract term. The lease term may include options to extend or terminate the lease when it is reasonably certain that the City will exercise that option. The City recognizes payments for short-term leases with a lease term of 12 month or less as expenses as incurred, and these leases are not included as lease liabilities or right-to-use lease assets on the statement of net position. The individual lease contracts do not always provide information about the discount rate implicit in the lease. Therefore, the City has elected to use their incremental borrowing rate to calculate the present value of expected lease payments when it is not explicitly stated in the contract. The City accounts for contracts containing both lease and non-lease components as separate contracts when possible. In cases where the contract does not provide separate price information for lease and non-lease components, and it is impractical to estimate the price of such components, the City treats the components as a single lease unit. U. Use of Estimates The preparation of financial statements in accordance with GAAP requires management to make estimates that affect amounts reported in the financial statements during the reporting period. Actual results could differ from such estimates. V. Reclassifications Certain prior year numbers have been reclassified to conform to current year presentation. CITY OF LITTLE CANADA, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2022 (46) NOTE 2 DEPOSITS AND INVESTMENTS A. Components of Cash and Investments Cash and investments at year-end consisted of the following: Investments 18,420,394$ Deposits 1,014,967 Cash on Hand 600 Total 19,435,961$ Cash and investments are presented in the financial statements as follows: Cash and Investments 19,435,961$ CITY OF LITTLE CANADA, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2022 (47) NOTE 2 DEPOSITS AND INVESTMENTS (CONTINUED) B. Deposits In accordance with applicable Minnesota Statutes, the City maintains deposits at depository banks authorized by the City Council, including checking accounts and certificates of deposit. The following is considered the most significant risk associated with deposits: Custodial Credit Risk – In the case of deposits, this is the risk that in the event of a bank failure, the City’s deposits may be lost. Minnesota Statutes require that all deposits be protected by federal deposit insurance, corporate surety bond, or collateral. The market value of collateral pledged must equal 110% of the deposits not covered by federal deposit insurance or corporate surety bonds. Authorized collateral includes treasury bills, notes, and bonds; issues of U.S. government agencies; general obligations rated “A” or better; revenue obligations rated “AA” or better; irrevocable standard letters of credit issued by the Federal Home Loan Bank; and certificates of deposit. Minnesota Statutes require that securities pledged as collateral be held in safekeeping in a restricted account at the Federal Reserve Bank or in an account at a trust department of a commercial bank or other financial institution that is not owned or controlled by the financial institution furnishing the collateral. At year-end, the carrying amount of the City’s deposits was $1,014,967 while the balance on the bank records was $1,014,967. At December 31, 2022, all deposits were fully covered by federal depository insurance, surety bonds, or by collateral held by the City’s agent in the City’s name. CITY OF LITTLE CANADA, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2022 (48) NOTE 2 DEPOSITS AND INVESTMENTS (CONTINUED) C. Investments The City has the following investments at year-end: Investments Measured at Fair Value Fair Value U.S. Treasury Security with Maturity at Purchase of Greater than 1 Year 1,043,907$ Negotiable Certificates of Deposit with Maturities at Purchase of Greater Than 1 Year 8,947,857 Federal Home Loan Bank 980,470 Federal Home Loan Mortgage Corporation 781,481 Federal Farm Credit Bank Bond 495,205 Municipal Bonds 218,734 Total Investments Measured at Fair Value 12,467,654$ Investments Measured at Amortized Cost Amortized Cost Negotiable Certificates of Deposit with Maturities at Purchase of Less Than 1 Year 490,413$ Money Market Funds 397,250 Minnesota Municipal Money Market (4M Fund) 5,065,077 Total Investments Measured at Amortized Cost 5,952,740$ Investments are subject to various risks, the following of which are considered the most significant: Interest Rate Risk – This is the risk of potential variability in the fair value of fixed rate investments resulting from changes in interest rates (the longer the period for which an interest rate is fixed, the greater the risk). The City’s investment policy requires the City to diversify its investment portfolio to eliminate the risk of loss resulting from over concentration of assets in a specific maturity. The policy states the City’s investment portfolio will remain sufficiently liquid to enable the City to meet all operating requirements. Custodial Credit Risk – For investments, this is the risk that in the event of a failure of the counterparty to an investment transaction (typically a broker-dealer) the City would not be able to recover the value of its investments or collateral securities that are in the possession of an outside party. The City’s investment policy does not address custodial credit risk. However, investments in securities are held by the City’s broker-dealers of which $1,500,000 is insured through SIPC. The broker-dealers have provided additional protection by providing additional insurance. This insurance is subject to aggregate limits applied to all of the broker-dealer’s accounts. CITY OF LITTLE CANADA, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2022 (49) NOTE 2 DEPOSITS AND INVESTMENTS (CONTINUED) C. Investments (Continued) Credit Risk – This is the risk that an issuer or other counterparty to an investment will not fulfill its obligations. Minnesota Statutes limit the City’s investments to direct obligations or obligations guaranteed by the United States or its agencies; shares of investment companies registered under the Federal Investment Company Act of 1940 that receive the highest credit rating, are rated in one of the two highest rating categories by a statistical rating agency, and all of the investments have a final maturity of 13 months or less; general obligations rated “A” or better; revenue obligations rated “AA” or better; general obligations of the Minnesota Housing Finance Agency rated “A” or better; bankers’ acceptances of United States banks eligible for purchase by the Federal Reserve System; commercial paper issued by United States corporations or their Canadian subsidiaries, rated of the highest quality category by at least two nationally recognized rating agencies, and maturing in 270 days or less; Guaranteed Investment Contracts guaranteed by a United States commercial bank, domestic branch of a foreign bank, or a United States insurance company, and with a credit quality in one of the top two highest categories; repurchase or reverse purchase agreements and securities lending agreements with financial institutions qualified as a “depository” by the government entity, with banks that are members of the Federal Reserve System with capitalization exceeding $10,000,000; that are a primary reporting dealer in U.S. government securities to the Federal Reserve Bank of New York; or certain Minnesota securities broker-dealers. A schedule of the maturities and ratings of the City’s investments as of December 31, 2022 is as follows: Investment Type Total Less Than 1 1 to 5 5 to 10 Rating U.S. Treasury Notes 1,043,907$ -$ 1,043,907$ -$ Not Rated Negotiable Certificates of Deposit 9,438,270 1,478,619 6,873,779 1,085,872 Not Rated Federal Home Loan Bank 980,470 - 980,470 - AA+/Aaa Federal Home Loan Mortgage Corporation 781,481 - 781,481 - AA+ Federal Farm Credit Bank Bond 495,205 - 495,205 - AA+/Aaa Municipal Bonds 218,734 - 118,034 100,700 AA-/A1 Money Market Funds 397,250 397,250 - - Not Rated Minnesota Municipal Money Market (4M Fund) 5,065,077 5,065,077 - - Not Rated Total Investments 18,420,394$ 6,940,946$ 10,292,876$ 1,186,572$ Concentration Risk – This is the risk associated with investing a significant portion of the City’s investment (considered 5% or more) in the securities of a single issuer. The City places no limit on the amount the City may invest in any one issuer. At December 31, 2022, the City had the following investments which individually comprise more than 5% of the City’s total investments: Percentage of Amount Investments Minnesota Municipal Money Market (4M Fund) 5,065,077$ 27.50% CITY OF LITTLE CANADA, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2022 (50) NOTE 2 DEPOSITS AND INVESTMENTS (CONTINUED) C. Investments (Continued) Fair Value Measurements The City uses fair value measurements to record fair value adjustments to certain asset and liabilities and to determine fair value disclosures. The City follows an accounting standard which defines fair value, establishes framework for measuring fair value, establishes a fair value hierarchy based on the quality of inputs used to measure fair value, and requires expanded disclosures about fair value measurements. In accordance with this standard, the City has categorized its investments, based on the priority of inputs to the valuation technique, into a three-level fair value hierarchy. The fair value hierarchy gives the highest priority to quotes and prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). If the inputs used to measure the financial instruments fall within different levels of the hierarchy, the categorization is based on the lowest level input that is significant to the fair value measurement of the instrument. Financial assets and liabilities recorded on the combined statements of financial position are categorized based on the inputs to the valuation techniques as follows: Level 1 – Financial assets and liabilities are valued using inputs that are unadjusted quoted prices in active markets accessible at the measurement date of identical financial assets and liabilities. Level 2 – Financial assets and liabilities are valued based on quoted prices for similar assets or inputs that are observable, either directly or indirectly, for substantially the full term through corroboration with observable market data. Level 3 – Financial assets and liabilities are valued using pricing inputs which are unobservable for the asset, inputs that reflect the reporting entity’s own assumptions about the assumptions market participants would use in pricing the asset. Investment Type Level 1 Level 2 Level 3 Total U.S. Treasuries with Maturities at Purchase of Greater Than 1 Year 1,043,907$ -$ -$ 1,043,907$ Negotiable Certificates of Deposit with Maturities at Purchase of Greater Than 1 Year - 8,947,857 - 8,947,857 Federal Home Loan Bank - 980,470 - 980,470 Federal Home Loan Mortgage Corporation - 781,481 - 781,481 Other Mortgage Backed Securities 495,205 - - 495,205 Municipal Bonds - 218,734 - 218,734 Total Investments Measured at Fair Value 495,205$ 10,928,542$ -$ 12,467,654 Investments Measured at Amortized Cost 5,952,740 Total Investments 18,420,394$ CITY OF LITTLE CANADA, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2022 (51) NOTE 3 RECEIVABLES Significant receivable balances not expected to be collected within one year of December 31, 2022 are as follows: Property Special Advances Taxes Assessment to Other Other Receivable Receivable Funds Receivable Total General Fund 72,832$ - 551,577$ 9,199$ 633,608$ Economic Development - - - - - General Capital Improvements - - - 470,994 470,994 Infrastructure CIP 1,924 1,625,356 - 109,303 1,736,583 Nonmajor Funds 7,097 456,607 33,770 237,834 735,308 Total 81,853$ 2,081,963$ 585,347$ 827,330$ 3,576,493$ NOTE 4 UNAVAILABLE REVENUE Governmental funds report deferred inflows of resources in connection with receivables for revenues that are considered not available to liquidate liabilities for the current period. At the end of the current fiscal year, the various components of unavailable revenue reported in the governmental funds were as follows: Property Special Taxes Assessments Other Total General Fund 62,246$ -$ -$ 62,246$ Economic Development - - - - General Capital Improvements - - 470,994 470,994 Infrastructure CIP 1,552 1,625,356 - 1,626,908 Nonmajor Funds 6,610 456,607 - 463,217 Total 70,408$ 2,081,963$ 470,994$ 2,623,365$ NOTE 5 LEASE RECEIVABLES The City, acting as a lessor leases certain real property to several communications companies on which to install cell towers under long-term, non-cancelable lease agreements. These leases expire in Fiscal year 2038 and 2039. During the year ended December 31, 2022, the City recognized $37,558 and $51,031 in lease revenue and interest revenue, respectively, pursuant to those contracts. CITY OF LITTLE CANADA, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2022 (52) NOTE 5 LEASE RECEIVABLES (CONTINUED) Total future minimum lease payments to be received under lease agreements are as follows: Year Ending December 31, Principal Interest 2023 42,403$ 49,729$ 2024 47,552 48,265 2025 53,022 46,628 2026 58,828 44,808 2027 64,987 42,794 2028-2032 431,036 176,095 2033-2037 649,616 89,052 Thereafter 209,584 6,333 Total 1,557,028$ 503,704$ Long-Term Lease Receivable Changes in the lease receivables for the year are as follows: Balance Balance Principal Due 12/31/2021 Additions Retirements 12/31/2022 Within One Year Long-Term Receivables Cell Tower Lease T-Mobile 584,186$ -$ 16,178$ 568,008$ 18,130$ Cell Tower Lease AT&T 1,010,400 - 21,380 989,020 24,273 Total 1,594,586$ -$ 37,558$ 1,557,028$ 42,403$ NOTE 6 CAPITAL ASSETS A. Changes in Capital Assets Used in Governmental Activities Capital asset activity for the year ended December 31, 2022 was as follows: Beginning Ending Balance Increases Decreases Transfers Balance Governmental Activities: Capital Assets, Not Being Depreciated: Land 3,620,111$ -$ -$ -$ 3,620,111$ Construction in Progress 172,438 591,617 - (92,571) 671,484 Total Capital Assets, Not Being Depreciated 3,792,549 591,617 - (92,571) 4,291,595 Capital Assets, Being Depreciated: Buildings and Building Improvements 7,665,497 10,760 - - 7,676,257 Other Improvements 1,251,714 538,776 - 8,403 1,798,893 Machinery and Equipment 5,998,103 130,493 (73,557) - 6,055,039 Streets 45,026,775 1,725,607 - 84,168 46,836,550 Total Capital Assets, Being Depreciated 59,942,089 2,405,636 (73,557) 92,571 62,366,739 Accumulated Depreciation for: Buildings and Building Improvements (2,917,835) (198,003) - - (3,115,838) Other Improvements (303,227) (46,061) - - (349,288) Machinery and Equipment (3,109,002) (301,579) 73,557 - (3,337,024) Streets (27,426,175) (1,423,951) - - (28,850,126) Total Accumulated Depreciation (33,756,239) (1,969,594) 73,557 - (35,652,276) Total Capital Assets, Being Depreciated, Net 26,185,850 436,042 - - 26,714,463 Governmental Activities Capital Assets, Net 29,978,399$ 1,027,659$ -$ -$ 31,006,058$ CITY OF LITTLE CANADA, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2022 (53) NOTE 6 CAPITAL ASSETS (CONTINUED) B. Changes in Capital Assets Used in Business-Type Activities Capital asset activity for the year ended December 31, 2022 was as follows: Beginning Ending Balance Increases Decreases Transfers Balance Business-Type Activities: Capital Assets, Not Being Depreciated: Permanent Easements 103,301$ -$ -$ -$ 103,301$ Construction in Progress - 4,672 - - 4,672 Total Capital Assets, Not Being Depreciated 103,301 4,672 - - 107,973 Capital Assets, Being Depreciated: Machinery and Equipment 1,185,085 53,345 - 17,012 1,255,442 Distribution and Collection System 18,824,340 311,185 - (17,012) 19,118,513 Total Capital Assets, Being Depreciated 20,009,425 364,530 - - 20,373,955 Accumulated Depreciation for: Machinery and Equipment (517,208) (57,804) - 443 (574,569) Distribution and Collection System (11,956,725) (353,900) - (443) (12,311,068) Total Accumulated Depreciation (12,473,933) (411,704) - - (12,885,637) Total Capital Assets, Being Depreciated, Net 7,535,492 (47,174) - - 7,488,318 Business-Type Activities Capital Assets, Net 7,638,793$ (42,502)$ -$ -$ 7,596,291$ C. Depreciation Expense by Function Depreciation expense was charged to the functions/programs of the primary government as follows: Governmental Activities: General Government 200,009$ Public Safety 146,415 Public Works 1,542,767 Community Services 80,403 Total Depreciation Expense, Governmental Activities 1,969,594$ Business-Type Activities: Water 252,963$ Sewer 158,741 Total Depreciation Expense, Business-Type Activities 411,704$ CITY OF LITTLE CANADA, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2022 (54) NOTE 7 LONG-TERM LIABILITIES A. Components of Long-Term Debt The City had the following long-term liabilities outstanding at December 31, 2022: Final Maturity Interest Authorized and Balance - Description Issue Date Date Rate Issued End of Year Governmental Activities: General Obligation Bonds: G.O. Bonds of 2014A 03/11/14 02/01/34 2.98% 3,400,000 2,245,000 G.O. Refunding Bonds of 2015A 06/23/15 02/01/26 2.00% 1,335,000 570,000 Total 4,735,000 2,815,000 Total Bonded Indebtedness 4,735,000 2,815,000 Notes from Direct Borrowings: Canabury Square Condos Note 05/14/10 02/01/25 2.00% 99,100 18,093 Total Notes from Direct Borrowings 99,100 18,093 Unamortized Bond Premium 15,864 Compensated Absences 122,337 Total Governmental Activities 4,834,100$ 2,971,294$ Business-Type Activities: Compensated Absences 84,580$ B. Changes in Long-Term Debt Long-term liability activity for the year ended December 31, 2022 was as follows: Beginning End of Due Within of Year Additions Retirements Year One Year Governmental Activities: General Obligation Bonds 3,100,000$ -$ (285,000)$ 2,815,000$ 295,000$ Plus: Unamortized Premiums 26,222 - (10,358) 15,864 - Total Bonds Payable 3,126,222 - (295,358) 2,830,864 295,000 Notes from Direct Borrowings 25,282 - (7,189) 18,093 7,354 Compensated Absences 115,910 87,518 (81,091) 122,337 70,369 Total Governmental Activities 3,267,414 87,518 (383,638) 2,971,294 372,723 Business-Type Activities: Compensated Absences 82,269 54,698 (52,387) 84,580 35,080 Total Debt 3,349,683$ 142,216$ (436,025)$ 3,055,874$ 407,803$ Compensated absences are generally liquidated in the General Fund for governmental activities and for business-type activities they are liquidated in the fund they are accrued (water and sewer). CITY OF LITTLE CANADA, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2022 (55) NOTE 7 LONG-TERM LIABILITIES (CONTINUED) C. Future Minimum Debt Payments Annual debt service requirements to maturity for long-term debt are as follows: Year Ending December 31,Principal Interest Principal Interest 2023 295,000$ 81,178$ 7,354$ 322$ 2024 305,000 74,378 7,491 189 2025 310,000 67,307 3,248 38 2026 315,000 59,465 - - 2027 175,000 52,625 - - 2028-2032 970,000 176,650 - - 2033-2034 445,000 17,900 - - Totals 2,815,000$ 529,503$ 18,093$ 549$ General Obligation Notes from Direct Borrowings Governmental Activities D. Revenues Pledged Canabury Square Condos Note – The City has pledged future housing improvement assessment revenue to repay the note payable to Ramsey County issued in 2010. Proceeds from the note provided financing for the 2010 Housing Improvement Area Project – Canabury Square Condos. Housing improvement assessments were projected to produce 100% of the debt service requirements over the life of the note. Total principal and interest remaining on the note is $18,642, payable through 2025. For the current year, principal and interest paid and total housing improvement assessment revenues were $7,198 and $481, respectively. The City’s outstanding notes from direct borrowings related to governmental activities contain provisions that in an event default, the County may declare the balance of the principal and interest outstanding under the notes to be immediately due and payable in full. CITY OF LITTLE CANADA, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2022 (56) NOTE 8 DEFINED BENEFIT PENSION PLANS – STATE-WIDE A. Plan Description The City of Little Canada participates in the following cost-sharing multiple-employer defined benefit pension plans administered by the Public Employees Retirement Association of Minnesota (PERA). PERA’s defined-benefit pension plans are established and administered in accordance with Minnesota Statutes, Chapters 353 and 356. PERA’s defined-benefit pension plans are tax-qualified plans under Section 401(a) of the Internal Revenue Code. 1. General Employees Retirement Plan All full-time and certain part-time employees of the City are covered by the General Employees Plan. General Employees Plan members belong to the Coordinated Plan. Coordinated Plan members are covered by Social Security. B. Benefits Provided PERA provides retirement, disability, and death benefits. Benefit provisions are established by state statute and can only be modified by the state Legislature. Vested, terminated employees who are entitled to benefits, but are not receiving them yet, are bound by the provisions in effect at the time they last terminated their public service. 1. General Employees Retirement Plan Benefits General Employees Plan benefits are based on a member’s highest average salary for any five successive years of allowable service, age, and years of credit at termination of service. Two methods are used to compute benefits for PERA's Coordinated Plan members. Members hired prior to July 1, 1989, receive the higher of Method 1 or Method 2 formulas. Only Method 2 is used for members hired after June 30, 1989. Under Method 1, the accrual rate for Coordinated members is 1.2 percent for each of the first 10 years of service and 1.7 percent for each additional year. Under Method 2, the accrual rate for Coordinated members is 1.7 percent for all years of service. For members hired prior to July 1, 1989 a full annuity is available when age plus years of service equal 90 and normal retirement age is 65. For members hired on or after July 1, 1989, normal retirement age is the age for unreduced Social Security benefits capped at 66. CITY OF LITTLE CANADA, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2022 (57) NOTE 8 DEFINED BENEFIT PENSION PLANS – STATE-WIDE (CONTINUED) Benefit increases are provided to benefit recipients each January. The postretirement increase is equal to 50 percent of the cost-of-living adjustment (COLA) announced by the SSA, with a minimum increase of at least 1 percent and a maximum of 1.5 percent. Recipients that have been receiving the annuity or benefit for at least a full year as of the June 30 before the effective date of the increase will receive the full increase. Recipients receiving the annuity or benefit for at least one month but less than a full year as of the June 30 before the effective date of the increase will receive a reduced prorated increase. For members retiring on January 1, 2024, or later, the increase will be delayed until normal retirement age (age 65 if hired prior to July 1, 1989, or age 66 for individuals hired on or after July 1, 1989). Members retiring under Rule of 90 are exempt from the delay to normal retirement. C. Contributions Minnesota Statutes Chapter 353 sets the rates for employer and employee contributions. Contribution rates can only be modified by the state legislature. 1. General Employees Fund Contributions Coordinated Plan members were required to contribute 6.50 percent of their annual covered salary in fiscal year 2022 and the City was required to contribute 7.50 percent for Coordinated Plan members. The City’s contributions to the General Employees Fund for the year ended December 31, 2022, were $104,636. The City’s contributions were equal to the required contributions as set by state statute. D. Pension Costs 1. General Employes Fund Pension Costs At December 31, 2022, the City reported a liability of $1,473,127 for its proportionate share of the General Employees Fund’s net pension liability. The City’s net pension liability reflected a reduction due to the State of Minnesota’s contribution of $16 million. The State of Minnesota is considered a non-employer contributing entity and the state’s contribution meets the definition of a special funding situation. The State of Minnesota’s proportionate share of the net pension liability associated with the City totaled $43,311. The net pension liability was measured as of June 30, 2022, and the total pension liability used to calculate the net pension liability was determined by an actuarial valuation as of that date. The City’s proportionate share of the net pension liability was based on the [entity’s] contributions received by PERA during the measurement period for employer payroll paid dates from July 1, 2021 through June 30, 2022, relative to the total employer contributions received from all of PERA’s participating employers. The City’s proportionate share was 0.0186 percent at the end of the measurement period and 0.0177 percent for the beginning of the period. CITY OF LITTLE CANADA, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2022 (58) NOTE 8 DEFINED BENEFIT PENSION PLANS – STATE-WIDE (CONTINUED) D. Pension Costs (Continued) City’s proportionate share of the net pension liability $1,473,127 State of Minnesota’s proportionate share of the net pension liability associated with the City 43,311 Total $1,516,438 For the year ended December 31, 2022, the City recognized pension expense of $214,314 for its proportionate share of the General Employees Plan’s pension expense. In addition, the City recognized an additional $6,456 as pension expense (and grant revenue) for its proportionate share of the State of Minnesota’s contribution of $16 million to the General Employees Fund. At December 31, 2022, the City reported its proportionate share of the General Employees Plan’s deferred outflows of resources and deferred inflows of resources related to pensions from the following sources: Deferred Deferred Outflows of Inflows of Description Resources Resources Differences Between Expected and Actual Economic Experience 12,306$ 15,737$ Changes in Actuarial Assumptions 333,395 5,991 Net Difference Between Projected and Actual Earnings on Pension Plan Investments 25,552 - Changes in Proportion and Differences Between City Contributions and Proportionate Share of Contributions 80,828 - City Contributions Subsequent to the Measurement Date 53,421 - Total 505,502$ 21,728$ CITY OF LITTLE CANADA, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2022 (59) NOTE 8 DEFINED BENEFIT PENSION PLANS – STATE-WIDE (CONTINUED) D. Pension Costs (Continued) The $53,421 reported as deferred outflows of resources related to pensions resulting from City contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ended December 31, 2023. Other amounts reported as deferred outflows and deferred inflows of resources related to pensions will be recognized in pension expense as follows: Pension Expenses Year Ended December 31,Amount 2023 170,875$ 2024 160,689 2025 (34,435) 2026 133,224 Thereafter - E. Long-Term Expected Return on Investment The State Board of Investment, which manages the investments of PERA, prepares an analysis of the reasonableness on a regular basis of the long-term expected rate of return using a building-block method in which best-estimate ranges of expected future rates of return are developed for each major asset class. These ranges are combined to produce an expected long-term rate of return by weighting the expected future rates of return by the target asset allocation percentages. The target allocation and best estimates of geometric real rates of return for each major asset class are summarized in the following table: Long-Term Target Expected Real Asset Class Allocation Rate of Return Domestic Equity 33.50% 5.10% International Equity 16.50 5.30 Fixed Income 25.00 0.75 Private Markets 25.00 5.90 Totals 100.00% F. Actuarial Methods Assumptions The total pension liability in the June 30, 2022, actuarial valuation was determined using an individual entry-age normal actuarial cost method. The long-term rate of return on pension plan investments used in the determination of the total liability is 6.5 percent. This assumption is based on a review of inflation and investments return assumptions from a number of national investment consulting firms. The review provided a range of return investment return rates deemed to be reasonable by the actuary. An investment return of 6.5 percent was deemed to be within that range of reasonableness for financial reporting purposes. CITY OF LITTLE CANADA, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2022 (60) NOTE 8 DEFINED BENEFIT PENSION PLANS – STATE-WIDE (CONTINUED) F. Actuarial Methods Assumptions (Continued) Inflation is assumed to be 2.25 percent for the General Employees Plan. Benefit increases after retirement are assumed to be 1.25 percent for the General Employees Plan through December 31, 2054 and 1.5 percent thereafter. Salary growth assumptions in the General Employees Plan range in annual increments from 10.25 percent after one year of service to 3.0 percent after 27 years of service Mortality rates for the General Employees Plan are based on the Pub-2010 General Employee Mortality Table. The tables are adjusted slightly to fit PERA’s experience. Actuarial assumptions for the General Employees Plan are reviewed every four years. The most recent four-year experience study for the General Employees Plan was completed in 2019. The assumption changes were adopted by the Board and became effective with the July 1, 2020 actuarial valuation. The following changes in actuarial assumptions and plan provisions occurred in 2022: General Employees Fund Changes in Actuarial Assumptions: x The mortality improvement scale was changed from Scale MP-2020 to Scale MP- 2021. Changes in Plan Provisions: x There were no changes in plan provisions since the previous valuation. G. Discount Rate The discount rate for the General Employees Plan used to measure the total pension liability in 2022 was 6.5 percent. The projection of cash flows used to determine the discount rate assumed that contributions from plan members and employers will be made at rates set in Minnesota Statutes. Based on these assumptions, the fiduciary net position of the General Employees Fund was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability. CITY OF LITTLE CANADA, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2022 (61) NOTE 8 DEFINED BENEFIT PENSION PLANS – STATE-WIDE (CONTINUED) H. Pension Liability Sensitivity The following presents the City’s proportionate share of the net pension liability for all plans it participates in, calculated using the discount rate disclosed in the preceding paragraph, as well as what the City’s proportionate share of the net pension liability would be if it were calculated using a discount rate one percentage point lower or one percentage point higher than the current discount rate: 1% Decrease Current 1% Increase in Discount Discount Rate in Discount Description Rate (5.50%) (6.50%) Rate (7.50%) City’s Proportionate Share of the GERF Net Pension Liability 2,326,880$ 1,473,127$ 772,916$ I. Pension Plan Fiduciary Net Position Detailed information about each pension plan’s fiduciary net position is available in a separately issued PERA financial report that includes financial statements and required supplementary information. That report may be obtained on the Internet at www.mnpera.org. NOTE 9 DEFINED CONTRIBUTION PENSION PLANS A. Public Employees Defined Contribution Plan (Defined Contribution Plan) Three council members of the City are covered by the Public Employees Defined Contribution Plan (PEDCP), a multiple-employer deferred compensation plan administered by the Public Employees Retirement Association of Minnesota (PERA). The Defined Contribution Plan is a tax qualified plan under Section 401(a) of the Internal Revenue Code and all contributions by or on behalf of employees are tax deferred until time of withdrawal. Plan benefits depend solely on amounts contributed to the plan plus investment earnings, less administrative expenses. Minnesota Statutes, Chapter 353D.03, specifies plan provisions, including the employee and employer contribution rates for those qualified personnel who elect to participate. An eligible elected official who decides to participate contributes five percent of salary which is matched by the elected official's employer. For ambulance service personnel, employer contributions are determined by the employer, and for salaried employees contributions must be a fixed percentage of salary. Employer contributions for volunteer personnel may be a unit value for each call or period of alert duty. Employees who are paid for their services may elect to make member contributions in an amount not to exceed the employer share. Employer and employee contributions are combined and used to purchase shares in one or more of the seven accounts of the Minnesota Supplemental Investment Fund. For administering the plan, PERA receives two percent of employer contributions and twenty-five hundredths of one percent (0.25 percent) of the assets in each member's account annually. Total contributions made by the City and plan members in 2022, 2021, and 2020 were $1,213, $1,213, and $1,220, respectively. CITY OF LITTLE CANADA, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2022 (62) NOTE 10 OTHER POSTEMPLOYMENT BENEFITS The City does not provide postemployment benefits other than permitting retired employees to continue in the City’s group health insurance plan, as required by Minnesota Statutes. The retiree is required to pay 100% of the premium. The premium charged is a single common premium for both active and retired employees. This practice has the potential to create an OPEB liability based on the theory that retirees have higher utilization of health care benefits than active employees (implicit rate subsidy). The City has determined the liability resulting from an implicit rate subsidy is not material and, therefore, not included in these financial statements. NOTE 11 INTERFUND RECEIVABLES/PAYABLES, LOANS AND TRANSFERS General General Economic Capital Infrastructure Nonmajor Fund Development Improvements CIP Governmental Total Transfer Out: Infrastructure CIP -$ -$ 14,300$ -$ -$ 14,300$ Nonmajor Governmental 89,763 672,836 - 1,471,783 2,234,382 Water Fund - - - - 225,000 225,000 Sewer Fund - - - - 150,000 150,000 Total 89,763$ 672,836$ 14,300$ -$ 1,846,783$ 2,623,682$ Transfer In All of the 2022 transfers are considered routine and consistent with previous practice and policies. The city had the following interfund transfers in 2022: x $7,000 from the HIA-Fleur Royale Condos to the General fund to close out excess funds x $35,000 from the Recycling and Disposal fund help fund city operations x $41,000 from the Cable TV fund to use excess fund balance to support general city operations x $672,835 from the Capital fund to the Economic Development fund to repay funds initially transferred from the EDA which were no longer needed for redevelopment x $14,300 from the Infrastructure CIP fund to General Capital Improvements for administrative related costs x $1,000,000 in TIF transfers were made from the TIF 3-3 and TIF 5-1 to the new Twin Lake Boulevard Development Fund x $375,000 to the Water/Sewer Capital Projects fund for capital related costs Four interfund loans were approved by the City to provide cash flow for certain improvements within TIF District 6-1, TIF District 7-1, TIF District 7-2, and Canabury Square Condominiums HIA. A summary at December 31, 2022 is as follows: Interfund Interfund Loan Loan Receivable Payable General Fund 551,577$ -$ Nonmajor Funds 33,770 585,347 Total 585,347$ 585,347$ CITY OF LITTLE CANADA, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2022 (63) NOTE 12 TAX ABATEMENTS The City of Little Canada has established a tax abatement program pursuant to Minnesota Statutes, Sections 469.1812 through 469.1815. As part of the City’s program the City enters into agreements through the use of tax increment financing districts under Minnesota Statutes 469.174 to 469.179 (the Tax Increment Act). Under these statutes the City annually abates taxes collected above the district’s base tax capacity which is established during adoption of the tax increment district. These agreements are established to foster economic development and redevelopment through creating jobs, removing blight, and providing affordable housing. For fiscal year ended December 31, 2022, the City has one agreement established under Minnesota Statutes Section 469.174 to 469.179 in the form of a pay-as-you-go note with an apartment complex. This agreement resulted in property taxes totaling $252,896 being abated in 2022. NOTE 13 COMMITMENTS AND CONTINGENT LIABILITIES A. Litigation The City has indicated that existing and pending lawsuits, claims and other actions in which the City is a defendant are either covered by insurance; of an immaterial amount; or, in the judgment of the City, remotely recoverable by plaintiffs. B. Federal and State Funds The City receives financial assistance from federal and state governmental agencies in the form of grants. The disbursement of funds received under these programs generally requires compliance with the terms and conditions specified in the grant agreements and are subject to audit by the grantor agencies. Any disallowed claims resulting from such audits could become a liability of the applicable fund. However, in the opinion of management, any such disallowed claims will not have a material effect on any of the financial statements of the individual fund types included herein or on the overall financial position of the City at December 31, 2022. C. Tax Increment Districts The City’s tax increment districts are subject to review by the State of Minnesota Office of the State Auditor (OSA). Any disallowed claims or misuse of tax increments could become a liability of the applicable fund. Management has indicated that they are not aware of any instances of noncompliance which would have a material effect on the financial statements. CITY OF LITTLE CANADA, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2022 (64) NOTE 14 DEFERRED AD VALOREM TAX LEVIES – BONDED DEBT General Obligation bond issues sold by the City are financed by ad valorem tax levies and special assessment bond issues sold by the City are partially financed by ad valorem tax levies in addition to special assessments levied against the benefitting properties. When a bond issue to be financed partially or completely by ad valorem tax levies is sold, specific annual amounts of such tax levies are stated in the bond resolution and the County Auditor is notified and instructed to levy these taxes over the appropriate years. The future tax levies are subject to cancellation when and if the City has provided alternative sources of financing. The City Council is required to levy any additional taxes found necessary for the full payment of principal and interest. These future scheduled tax levies are not shown as assets in the accompanying financial statements at December 31, 2022. At December 31, 2022, future scheduled tax levies for all bonds outstanding totaled $2,245,000. The City is currently working to eliminate the debt levies over time. NOTE 15 FUND BALANCES A. Classifications A summary of the governmental fund balance classifications at December 31, 2022 is as follows: Nonspendable Restricted Committed Assigned Unassigned Total General Fund: -$ -$ -$ -$ 3,039,880$ 3,039,880$ Prepaid Items 23,052 - - - - 23,052 Advances to Other Funds 551,577 - - - - 551,577 Total General Fund 574,629 - - - 3,039,880 3,614,509 Economic Development - - 744,421 - - 744,421 General Capital Improvements: Capital Improvements - 78,000 - 3,531,569 - 3,609,569 Infrastructure CIP:- Capital Improvements - - - 2,447,079 2,447,079 Total Other Major Funds - 78,000 744,421 5,978,648 - 6,801,069 Nonmajor Funds: Charitable Gambling - 163,059 - - - 163,059 Park Acquisition - 970,931 53,085 344,903 - 1,368,919 Debt Retirement - 116,807 - - - 116,807 Fire Equipment - 496,573 - 1,309,445 - 1,806,018 Tax Increment Purposes - 1,263,356 - - - 1,263,356 Cable - - 507,567 - - 507,567 Recycling - - 159,682 - - 159,682 Redevelopment - - - 1,006,191 - 1,006,191 Capital Improvements - - - 1,769,846 - 1,769,846 Deficit Fund Balance - - - - (383,873) (383,873) Total Nonmajor Funds - 3,010,726 720,334 4,430,385 (383,873) 7,777,572 Total Fund Balances Governmental Funds 574,629$ 3,088,726$ 1,464,755$ 10,409,033$ 2,656,007$ 18,193,150$ CITY OF LITTLE CANADA, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2022 (65) NOTE 15 FUND BALANCES (CONTINUED) B. Fund Balance Policy The City Council has formally adopted a policy regarding the minimum unassigned fund balance for the General Fund. The most significant revenue source of the General Fund is property taxes. This revenue source is received in two installments during the year – June and December. As such, it is the City’s goal to begin each fiscal year with sufficient working capital to fund operations between each semi-annual receipt of property taxes. The policy establishes a year-end targeted unassigned fund balance amount for cash- flow timing needs in the range of 42.5-65% of the subsequent year’s budgeted expenditures. At December 31, 2022, the unassigned fund balance of the General Fund was 62.6% of the subsequent year’s budgeted expenditures. A large portion of the fund balance is in the form of nonspendable advances to other funds. NOTE 16 STEWARDSHIP AND ACCOUNTABILITY At December 31, 2022, individual funds with deficit fund balances/net position are as follows: Fund Amounts Nonmajor Governmental Funds: Canabury Condos Notes (2,546)$ Future special assessment payments TIF #6-1 (363,097) TIF #7-3 (18,230) Future TIF Revenue The deficit fund balances will be resolved through Future TIF Revenue NOTE 17 CONDUIT DEBT OBLIGATIONS The City has issued Industrial Revenue Bonds to provide financial assistance to private- sector entities for the acquisition and construction of industrial and commercial facilities which are deemed to be in the public interest. The bonds are secured by the property financed and are payable solely from payments on the underlying mortgage loans. Upon repayment of the bonds, ownership of the acquired facilities transfers to the private sector entity served by the bond issue. The City is not obligated in any manner for the repayment of the bonds. Accordingly, the bonds are not reported as liabilities in the accompanying financial statements. As of December 31, 2022, ten series of industrial revenue bonds, two series of educational facilities revenue bonds, one series of community service revenue bonds, and two senior housing revenue-refunding bonds were outstanding. The aggregate principal amount payable for the fifteen series could not be determined; however, their original issue amounts totaled $85,558,947. CITY OF LITTLE CANADA, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2022 (66) NOTE 18 COMMITMENTS During 2002, the City issued the Tax Increment Revenue Note of 2002 in the principal sum of $1,050,000. This note is not reflected in the financial statements of the City because the note is not a General Obligation of the City and is payable solely from available tax increments. The note reads in part as follows: The payment amounts due hereon shall be payable solely from tax increments (the Tax Increments) from the City’s Tax Increment Financing District No. 3-3 (the Tax Increment District) within its Municipal Development District No. 3 which are paid to the City and which the City is entitled to retain pursuant to the provisions of Minnesota Statutes, Sections 469.174 through 469.179, as the same may be amended or supplemented from time-to-time (the Tax Increment Act). This note is not a general obligation of the City, and neither the full faith and credit nor the taxing powers of the City are pledged to the payment of the principal of or interest of this note and property or other asset of the City, save and except the above-referenced Tax Increments, is or shall be a source of payment of the City’s obligations hereunder. During 2012, the City issued the Tax Increment Revenue Note of 2012 in the principal sum of $530,237. This note is not reflected in the financial statements of the City because the note is not a General Obligation of the City and is payable solely from available tax increments. The note reads in part as follows: The payment amounts due hereon shall be payable solely from tax increments (the Tax Increments) from the City’s Tax Increment Financing District No. 5-1 (the Tax Increment District) within its Municipal Development District No. 5 which are paid to the City and which the City is entitled to retain pursuant to the provisions of Minnesota Statutes, Sections 469.174 through 469.179, as the same may be amended or supplemented from time-to-time (the Tax Increment Act), which are remitted or remaining after (a) the principal of an interest on the bonds have been paid in full, (b) the City has fully reimbursed itself from tax increments for any City Phase III shortfall amount, and (c) payment of the guaranty note in full (the Available Tax Increments). This note is not a general obligation of the City, and neither the full faith and credit nor the taxing powers of the City are pledged to the payment of the principal of or interest of this note and no property or other asset of the City, save and except the above-referenced Tax Increments, is or shall be a source of payment of the City’s obligations hereunder. During 2020, the City issued the Tax Increment Revenue Note of 2020 in the principal sum of $150,000. This note is not reflected in the financial statements of the City because the note is not a General Obligation of the City and is payable solely from available tax increments. The note reads in part as follows: CITY OF LITTLE CANADA, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2022 (67) NOTE 18 COMMITMENTS (CONTINUED) The payment amounts due hereon shall be payable solely from tax increments (the Tax Increments) from the City’s Tax Increment Financing District No. 7-2 (the Tax Increment District) within its Municipal Development District No. 7 which are paid to the City and which the City is entitled to retain pursuant to the provisions of Minnesota Statutes, Sections 469.174 through 469.1794, as the same may be amended or supplemented from time-to-time (the Tax Increment Act), which are remitted or remaining after (a) the principal of an interest on the bonds have been paid in full, (b) the City has fully reimbursed itself from tax increments for any City Phase III shortfall amount, and (c) payment of the guaranty note in full (the Available Tax Increments). This note is not a general obligation of the City, and neither the full faith and credit nor the taxing powers of the City are pledged to the payment of the principal of or interest of this note and no property or other asset of the City, save and except the above-referenced Tax Increments, is or shall be a source of payment of the City’s obligations hereunder. REQUIRED SUPPLEMENTARY INFORMATION CITY OF LITTLE CANADA, MINNESOTA SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES GENERAL FUND – BUDGET TO ACTUAL (GAAP BASIS) YEAR ENDED DECEMBER 31, 2022 WITH COMPARATIVE TOTALS FOR YEAR ENDED DECEMBER 31, 2021 (70) 2021 Over (Under) Actual Original Final Actual Final Budget Amounts REVENUE Property Taxes: Current 3,382,230$ 3,382,230$ 3,459,177$ 76,947$ 3,291,911$ Delinquent Mobile Home and Other 10,000 10,000 12,208 2,208 13,993 Total Property Taxes 3,392,230 3,392,230 3,471,385 79,155 3,305,904 Special Assessments - - 75 75 289 Licenses and Permits 323,155 323,155 562,379 239,224 195,101 Intergovernmental Revenue: State: Local Government Aid 86,980 86,980 86,982 2 86,982 Fire Aid 58,000 58,000 75,644 17,644 70,980 MSA 114,100 114,100 141,573 27,473 123,106 Other State Aids - - - - 2,170 County: Waste Recycling Grant 28,438 28,438 31,721 3,283 29,831 Total Intergovernmental Revenues 287,518 287,518 335,920 48,402 313,069 Charges for Services: Customer Collections 12,540 12,540 13,027 487 8,309 Parks and Recreation 9,750 9,750 8,950 (800) 7,946 Administrative Charges 2,100 2,100 4,368 2,268 753 Total Charges for Services 24,390 24,390 26,345 1,955 17,008 Fines and Forfeits 44,000 44,000 45,911 1,911 40,439 Investment Earnings 36,100 36,100 (35,498) (71,598) 12,687 Miscellaneous Revenues: Rents and Refunds 184,997 184,997 167,418 (17,579) 78,694 Miscellaneous Revenue 2,000 2,000 11,462 9,462 10,838 Total Miscellaneous Revenues 186,997 186,997 178,880 (8,117) 89,532 Total Revenue 4,294,390 4,294,390 4,585,397 291,007 3,974,029 2022 Budgeted Amounts CITY OF LITTLE CANADA, MINNESOTA SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES GENERAL FUND – BUDGET TO ACTUAL (GAAP BASIS) (CONTINUED) YEAR ENDED DECEMBER 31, 2022 WITH COMPARATIVE TOTALS FOR YEAR ENDED DECEMBER 31, 2021 (71) 2021 Over (Under) Actual Original Final Actual Final Budget Amounts 2022 Budgeted Amounts EXPENDITURES General Government: Mayor and City Council 93,900$ 93,900$ 87,278$ (6,622)$ 87,315$ Elections 33,000 33,000 32,956 (44) 31,721 Administration 230,450 230,450 225,754 (4,696) 206,934 Attorney 95,500 95,500 80,942 (14,558) 77,316 Planning and Zoning 172,120 172,120 158,986 (13,134) 181,272 Insurance 38,790 38,790 38,790 - 38,930 City Hall 31,700 31,700 31,218 (482) 26,010 Total General Government 695,460 695,460 655,924 (39,536) 649,498 Public Safety: Police Protection 1,801,685 1,801,685 1,776,682 (25,003) 1,761,173 Fire: Pension Plan - City and State 91,610 91,610 109,254 17,644 103,517 Other Current 387,575 387,575 388,234 659 370,349 Fire Inspections 15,200 15,200 11,007 (4,193) 6,886 Protective Inspections 235,030 235,030 238,376 3,346 217,088 Civil Defense 2,910 2,910 2,174 (736) 2,249 Animal Control 3,370 3,370 2,105 (1,265) 2,149 Total Public Safety 2,537,380 2,537,380 2,527,832 (9,548) 2,463,411 Public Works: Street Maintenance 341,680 341,680 321,384 (20,296) 247,249 Engineering 28,000 28,000 34,992 6,992 32,401 Storm Sewers 16,640 16,640 7,862 (8,778) 1,602 Street Lighting 65,300 65,300 65,091 (209) 61,480 Recycling/Sanitation 31,640 31,640 22,803 (8,837) 25,646 City Garage 37,445 37,445 48,702 11,257 35,455 Tree Trimming 10,000 10,000 20,650 10,650 17,570 Total Public Works 530,705 530,705 521,484 (9,221) 421,403 Community Service: Parks and Recreation 530,270 530,270 523,758 (6,512) 483,510 Community Parternerships 30,095 30,095 23,071 (7,024) 20,949 Old Fire Station 8,400 8,400 10,446 2,046 6,245 Total Community Service 568,765 568,765 557,275 (11,490) 510,704 Total Expenditures 4,332,310 4,332,310 4,262,515 (69,795) 4,045,016 EXCESS (DEFICIENCY) OF REVENUE OVER (UNDER) EXPENDITURES (37,920) (37,920) 322,882 360,802 (70,987) OTHER FINANCE SOURCES (USES) Transfer In 106,400 106,400 89,763 (16,637) 114,953 Transfers Out - - - - (900,000) Total Other Finance Sources (Uses) 106,400 106,400 89,763 (16,637) (785,047) NET CHANGE IN FUND BALANCES 68,480$ 68,480$ 412,645 344,165$ (856,034) FUND BALANCES Beginning of Year 3,201,864 4,057,898 End of Year 3,614,509$ 3,201,864$ CITY OF LITTLE CANADA, MINNESOTA SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES ECONOMIC DEVELOPMENT FUND – BUDGET TO ACTUAL (GAAP BASIS) YEAR ENDED DECEMBER 31, 2022 WITH COMPARATIVE TOTALS FOR YEAR ENDED DECEMBER 31, 2021 (72) 2021 Over (Under)Actual Original Final Actual Final Budget Amounts REVENUE Other Revenue: Investment Earnings -$ -$ (2,445)$ (2,445)$ (160)$ Miscellaneous Revenue - - 46,599 46,599 18,875 Total Revenue - - 44,154 44,154 18,715 EXPENDITURES Current: Interest Expense - - 2,545 2,545 2,159 EXCESS OF REVENUE OVER EXPENDITURES - - 41,609 41,609 16,556 OTHER FINANCE USES Transfer In - - 672,836 672,836 - NET CHANGE IN FUND BALANCES -$ -$ 714,445 44,154$ 16,556 FUND BALANCES Beginning of Year 29,976 13,420 End of Year 744,421$ 29,976$ 2022 Budgeted Amounts CITY OF LITTLE CANADA, MINNESOTA NOTES TO REQUIRED SUPPLEMENTARY INFORMATION YEAR ENDED DECEMBER 31, 2022 (73) The General Fund budget is legally adopted on a basis consistent with U.S. Generally Accepted Accounting Principles. The legal level of budgetary control is at the department level. The following is a listing of expenditures that exceeded budgeted appropriates. Actual in Final Excess of Budget Actual Budget Public Safety: Fire Pension Plan - City and State 91,610$ 109,254$ 17,644$ Other Current 387,575 388,234 659 Protective Inspections 235,030 238,376 3,346 Public Works: Engineering 28,000 34,992 6,992 City Garage 37,445 48,702 11,257 Tree Trimming 10,000 20,650 10,650 CITY OF LITTLE CANADA, MINNESOTA PERA SCHEDULE OF THE CITY’S PROPORTIONATE SHARE OF THE NET PENSION LIABILITY YEAR ENDED DECEMBER 31, 2022 (74) Measurement Measurement Measurement Measurement Measurement Measurement Measurement Measurement MeasurementDate 6/30/2022 Date 6/30/2021 Date 6/30/2020 Date 6/30/2019 Date 6/30/2018 Date 6/30/2017 Date 6/30/2016 Date 6/30/2015 Date 6/30/2014City’s Proportion of the Net Pension Liability0.0186% 0.0177% 0.0168% 0.0158% 0.0172% 0.0169% 0.0177% 0.0189% 0.0209%City’s Proportionate Share of the Net Pension Liability1,473,127$ 755,868$ 1,007,236$ 873,546$ 954,185$ 1,078,886$ 1,437,152$ 979,496$ 981,777$ State’s Proportionate Share of the Net Pension LiabilityAssociated with the City 43,311 23,031 31,027 27,165 31,362 13,538 - - - Total1,516,438$ 778,899$ 1,038,263$ 900,711$ 985,547$ 1,092,424$ 1,437,152$ 979,496$ 981,777$ City’s Covered Payroll1,400,107$ 1,320,114$ 1,197,694$ 1,118,348$ 1,160,624$ 1,086,457$ 1,109,852$ 1,117,363$ 1,099,159$ City’s Proportionate Share of the Net Pension Liability as a Percentage of its Covered Payroll105.22% 57.26% 84.10% 78.11% 82.21% 99.30% 129.49% 87.66% 89.32%Plan Fiduciary Net Position as a Percentage of the Total Pension Liability76.70% 87.00% 79.10% 80.23% 79.53% 75.90% 68.90% 78.20% 78.70% Ten years of data is not yet available but years will be added going forward until ten years are presented. * The Amounts Presented for Each Fiscal Year were Determined as of 6/30. CITY OF LITTLE CANADA, MINNESOTA PERA SCHEDULE OF THE CITY CONTRIBUTIONS YEAR ENDED DECEMBER 31, 2022 (75) 2022 2021 2020 2019 2018 2017 2016 2015 2014Statutorily Required Contribution 104,636$ 99,331$ 96,929$ 85,748$ 86,397$ 84,726$ 80,064$ 84,688$ 81,379$ Contributions in Relation to the Statutorily Required Contribution(104,636) (99,331) (96,929) (85,748) (86,397) (84,726) (80,064) (84,688) (81,379) Contribution Deficiency (Excess) -$ -$ -$ -$ -$ -$ -$ -$ -$ City’s Covered Payroll 1,395,147$ 1,324,413$ 1,292,387$ 1,143,307$ 1,151,960$ 1,129,680$ 1,067,520$ 1,129,173$ 1,122,463$ Contributions as a Percentage of Covered Payroll 7.50% 7.50% 7.50% 7.50% 7.50% 7.50% 7.50% 7.50% 7.25%Ten years of data is not yet available but years will be added going forward until ten years are presented. COMBINING AND INDIVIDUAL FUND STATEMENTS AND SCHEDULES CITY OF LITTLE CANADA, MINNESOTA NONMAJOR GOVERNMENTAL FUNDS COMBINING BALANCE SHEET DECEMBER 31, 2022 WITH COMPARATIVE TOTALS FOR DECEMBER 31, 2021 (76) Special Debt Capital Revenue Service Project 2022 2021 ASSETS Cash and Investments 555,232$ 129,801$ 6,134,264$ 6,819,297$ 5,458,977$ Interund Loan Receivable - 33,770 33,770 8,049 Accounts Receivable (Net of Allowance) 234,714 - 3,120 237,834 231,351 Property Taxes Receivable: Delinquent Taxes - - 6,610 6,610 1,848 Due from County - - 487 487 1,960 Special Assessments Receivable: Deferred - 417,582 29,847 447,429 15,188 Delinquent - 646 8,532 9,178 9,298 Special Deferred - - - - 29,022 Prepaids - - 675,449 675,449 - Property Held for Resale - - 701,015 701,015 387,155 Total Assets 789,946$ 548,029$ 7,593,094$ 8,931,069$ 6,142,848$ LIABILITIES, DEFERRED INFLOWS OF RESOURCES, AND FUND BALANCE LIABILITIES Accounts and Contracts Payable 36,977$ -$ 35,321$ 72,298$ 167,027$ Interfund Loan Payable - 15,540 569,807 585,347 14,466 Due to Other Governmental Units 28,284 - - 28,284 27,703 Unearned Revenue 4,351 - - 4,351 4,351 Total Liabilities 69,612 15,540 605,128 690,280 213,547 DEFERRED INFLOWS OF RESOURCES Unavailable Revenue - Taxes - - 6,610 6,610 1,848 Unavailable Revenue - Special Assessments - 418,228 38,379 456,607 53,508 Total Deferred Inflows of Resources - 418,228 44,989 463,217 55,356 FUND BALANCE Restricted Charitable Gambling - - 163,059 163,059 151,658 Park Acquisition - - 970,931 970,931 877,603 Debt Retirement - 116,807 - 116,807 82,931 Fire Equipment - - 496,573 496,573 366,573 Tax Increment Purposes - - 1,263,356 1,263,356 2,113,112 Committed 720,334 - - 720,334 728,360 Assigned - - 4,430,385 4,430,385 1,573,212 Unassigned - (2,546) (381,327) (383,873) (19,504) Total Fund Balance 720,334 114,261 6,942,977 7,777,572 5,873,945 Total Liabilities, Deferred Inflows of Resources, and Fund Balance 789,946$ 548,029$ 7,593,094$ 8,931,069$ 6,142,848$ Total Nonmajor Governmental Funds CITY OF LITTLE CANADA, MINNESOTA NONMAJOR GOVERNMENTAL FUNDS COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES YEAR ENDED DECEMBER 31, 2022 WITH COMPARATIVE TOTALS FOR YEAR ENDED DECEMBER 31, 2021 (77) Special Debt Capital Revenue Service Project 2022 2021 REVENUE Property Taxes -$ -$ 159,048$ 159,048$ 159,508$ Franchise Tax 110,088 - - 110,088 120,686 Tax Increment Collections - - 703,636 703,636 624,416 Special Assessments 281,945 55,155 337,100 8,389 Charges for Services 534,620 - 52,380 587,000 527,683 Investment Earnings (13,094) - (110,331) (123,425) (9,965) Contributions - - 262,126 262,126 64,883 Donations 37,266 - - 37,266 167,013 Miscellaneous Revenue 95 - 2,931 3,026 418 Total Revenue 668,975 281,945 1,124,945 2,075,865 1,663,031 EXPENDITURES Current: General Government - 1,000 28,778 29,778 2,480 Housing and Economic Development - - 271,771 271,771 279,089 Public Works - - 28,759 28,759 - Sanitation 476,404 - - 476,404 462,250 Parks and Recreation 124,597 - 15,000 139,597 101,716 Capital Outlay Public Safety - - - - 50,802 Public Works - - 345,291 345,291 - Parks and Recreation - - - - 1,808 Debt Service: Principal Retirement - 292,189 16,360 308,549 292,190 Interest - 94,993 6,391 101,384 94,602 Fiscal Charges - 950 - 950 950 Miscellaneous - 995 - 995 800 Total Expenditures 601,001 390,127 712,350 1,703,478 1,286,687 EXCESS (DEFICIENCY)( OF REVENUE OVER (UNDER) EXPENDITURES 67,974 (108,182) 412,595 372,387 376,344 OTHER FINANCE SOURCES (USES) Transfers In - 374,893 1,471,890 1,846,783 375,978 Transfers Out (76,000) - (2,158,382) (2,234,382) (260,453) Total Other Finance Sources (Uses) (76,000) 374,893 (686,492) (387,599) 115,525 NET CHANGE IN FUND BALANCES (8,026) 266,711 (273,897) (15,212) 491,869 FUND BALANCES Beginning of Year 728,360 (152,450) 7,216,874 7,792,784 5,382,076 End of Year 720,334$ 114,261$ 6,942,977$ 7,777,572$ 5,873,945$ Total Nonmajor Governmental Funds NONMAJOR SPECIAL REVENUE FUNDS Nonmajor special revenue funds are used to account for revenue derived from specific revenue sources that are legally restricted or committed to expenditures for specific purposes. Parks and Recreation – Used to account for amounts received and related expenditures for the City’s parks and recs activity. Cable TV Fund – Used to account for amounts received and related expenditures for the City’s membership in a regional cable commission. Recycling/Trash Fund – Used to account for amounts received and related expenditures for the City’s recycling program. CITY OF LITTLE CANADA, MINNESOTA NONMAJOR SPECIAL REVENUE FUNDS COMBINING BALANCE SHEET DECEMBER 31, 2022 WITH COMPARATIVE TOTALS FOR DECEMBER 31, 2021 (78) Parks and Recycling/ Recreation Cable TV Trash (201) (202) (203) 2022 2021 ASSETS Cash and Investments 50,861$ 481,549$ 22,822$ 555,232$ 577,548$ Accounts Receivable 6,685 26,991 201,038 234,714 220,597 Total Assets 57,546$ 508,540$ 223,860$ 789,946$ 798,145$ LIABILITIES AND FUND BALANCE LIABILITIES Accounts and Contracts Payable 110$ 973$ 35,894$ 36,977$ 37,731$ Due to Other Governmental Units - - 28,284 28,284 27,703 Unearned Revenue 4,351 - - 4,351 4,351 Total Liabilities 4,461 973 64,178 69,612 69,785 FUND BALANCE Committed for: Parks and recreation 53,085 - - 53,085 55,670 Cable - 507,567 - 507,567 509,681 Recycling - - 159,682 159,682 163,009 Total Fund Balance 53,085 507,567 159,682 720,334 728,360 Total Liabilities and Fund Balance 57,546$ 508,540$ 223,860$ 789,946$ 798,145$ Total Nonmajor Special Revenue Funds CITY OF LITTLE CANADA, MINNESOTA NONMAJOR SPECIAL REVENUE FUNDS COMBINING STATEMENT OF REVENUE, EXPENDITURES, AND CHANGES IN FUND BALANCES YEAR ENDED DECEMBER 31, 2022 WITH COMPARATIVE TOTALS FOR YEAR ENDED DECEMBER 31, 2021 (79) Parks and Recycling/ Recreation Cable TV Trash (201)(202)(203)2022 2021 REVENUE Franchise Fees -$ 110,088$ -$ 110,088$ 120,686$ Charges for Service 25,840 - 508,780 534,620 527,683 Investment Earnings (1,239) (11,057) (798) (13,094) (1,303) Donations 37,266 - - 37,266 2,691 Miscellaneous Revenue - - 95 95 418 Total Revenue 61,867 99,031 508,077 668,975 650,175 EXPENDITURES Current: Sanitation - - 476,404 476,404 462,250 Parks and Recreation 64,452 60,145 - 124,597 86,716 Capital Outlay: Parks and recreation - - - - 1,808 Total Expenditures 64,452 60,145 476,404 601,001 550,774 EXCESS OF REVENUE OVER EXPENDITURES (2,585) 38,886 31,673 67,974 99,401 OTHER FINANCE USES Transfers Out - (41,000) (35,000) (76,000) (76,100) NET CHANGE IN FUND BALANCES (2,585) (2,114) (3,327) (8,026) 23,301 FUND BALANCES Beginning of Year 55,670 509,681 163,009 728,360 705,059 End of Year 53,085$ 507,567$ 159,682$ 720,334$ 728,360$ Total Nonmajor Special Revenue Funds CITY OF LITTLE CANADA, MINNESOTA PARKS AND RECREATION SPECIAL REVENUE FUND SCHEDULE OF REVENUE, EXPENDITURES, AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL YEAR ENDED DECEMBER 31, 2022 WITH COMPARATIVE TOTALS FOR YEAR ENDED DECEMBER 31, 2021 (80) 2021 Over (Under)Actual Original Final Actual Final Budget Amounts REVENUE Charges for Services 30,680$ 30,680$ 25,840$ (4,840)$ 20,246$ Other Revenue: Investment Earnings200 200 (1,239) (1,439) (105) Miscellaneous Revenue 18,500 18,500 37,266 18,766 25,480 Total Revenue 49,380 49,380 61,867 12,487 45,621 EXPENDITURES Current: Community Services 53,990 53,990 64,452 10,462 27,792 NET CHANGE IN FUND BALANCES (4,610)$ (4,610)$ (2,585) 2,025$ 17,829 FUND BALANCES Beginning of Year 55,670 37,841 End of Year 53,085$ 55,670$ 2022 Budgeted Amounts CITY OF LITTLE CANADA, MINNESOTA CABLE TV SPECIAL REVENUE FUND SCHEDULE OF REVENUE, EXPENDITURES, AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL YEAR ENDED DECEMBER 31, 2022 WITH COMPARATIVE TOTALS FOR YEAR ENDED DECEMBER 31, 2021 (81) 2021 Over (Under)Actual Original Final Actual Final Budget Amounts REVENUE Franchise Fees 111,700$ 111,700$ 110,088$ (1,612)$ 120,686$ Other Revenue: Investment Earnings 2,380 2,380 (11,057) (13,437) (1,084) Total Revenue 114,080 114,080 99,031 (15,049) 119,602 EXPENDITURES Current: Community Services 68,970 68,970 60,145 (8,825) 58,924 Capital Outlay 15,000 15,000 - (15,000) 1,808 Total Expenditures 83,970 83,970 60,145 (23,825) 60,732 EXCESS OF REVENUE OVER EXPENDITURES 30,110 30,110 38,886 8,776 58,870 OTHER FINANCE USES Transfers Out (41,100) (41,100) (41,000) 100 (41,100) NET CHANGE IN FUND BALANCES (10,990)$ (10,990)$ (2,114) 8,876$ 17,770 FUND BALANCES Beginning of Year 509,681 491,911 End of Year 507,567$ 509,681$ 2022 Budgeted Amounts CITY OF LITTLE CANADA, MINNESOTA RECYCLING/TRASH SPECIAL REVENUE FUND SCHEDULE OF REVENUE, EXPENDITURES, AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL YEAR ENDED DECEMBER 31, 2022 WITH COMPARATIVE TOTALS FOR YEAR ENDED DECEMBER 31, 2021 (82) 2021 Over (Under) Actual Original Final Actual Final Budget Amounts REVENUE Charges for Services 505,220$ 505,220$ 508,780$ 3,560$ 484,650$ Other Revenue: Investment Earnings 340 340 (798) (1,138) (114) Miscellaneous Revenue - - 95 95 418 Total Revenue 505,560 505,560 508,077 2,517 484,954 EXPENDITURES Current: Community Services 488,700 488,700 476,404 (12,296) 462,252 EXCESS OF REVENUE OVER EXPENDITURES 16,860 16,860 31,673 14,813 22,702 OTHER FINANCE SOURCES (USES) Transfers Out (35,000) (35,000) (35,000) - (35,000) NET CHANGE IN FUND BALANCES (18,140)$ (18,140)$ (3,327) 14,813$ (12,298) FUND BALANCES Beginning of Year 163,009 175,307 End of Year 159,682$ 163,009$ 2022 Budgeted Amounts NONMAJOR DEBT SERVICE FUNDS Nonmajor debt service funds are used to account for the accumulation of resources used for the payment of principal, interest, and fiscal charges on various City bond issues. Canabury Condos Notes – Used to account for amounts received and related debt service expenditures of the Canabury Condos Notes. Canabury Square Condos HIA – Used to account for the debt service associated with housing improvement area project costs for the Canabury Square condominiums. G.O. Bonds 2014A – Used to account for amounts received and related debt service expenditures of the 2014A G.O. Bonds. G.O. Refunding Bonds 2015A – Used to account for amounts received and related debt service expenditures of the 2015A G.O. Refunding Bonds. CITY OF LITTLE CANADA, MINNESOTA NONMAJOR DEBT SERVICE FUNDS COMBINING BALANCE SHEET DECEMBER 31, 2022 WITH COMPARATIVE TOTALS FOR DECEMBER 31, 2021 (83) Canabury Canabury Square G.O Bonds GO Bonds Condos Notes Condos HIA 2014A 2015A 2022 2021 (375) (362) (310) (320) Totals Totals ASSETS Cash and Investments 99$ 46,771$ 82,931$ -$ 129,801$ 82,931$ Property Taxes Receivable: Due from County - - - - - 155 Special Assessments Receivable: Deferred 9,709 407,873 - - 417,582 15,188 Delinquent 646 - - - 646 723 Total Assets 10,454$ 454,644$ 82,931$ -$ 548,029$ 98,997$ LIABILITIES, DEFERRED INFLOWS OF RESOURCES, AND FUND BALANCE LIABILITIES Interfund Loan Payable 2,645$ 12,895$ -$ -$ 15,540$ 8,049$ DEFERRED INFLOWS OF RESOURCES Unavailable Revenue -Special Assessments 10,355 407,873 - - 418,228 15,911 FUND BALANCE Restricted Debt Retirement - 33,876 82,931 - 116,807 82,931 Unassigned (2,546) - - - (2,546) (7,894) Total Fund Balance (2,546) 33,876 82,931 - 114,261 75,037 Total Liabilities, Deferred Inflows of Resources, and Fund Balance 10,454$ 454,644$ 82,931$ -$ 548,029$ 98,997$ CITY OF LITTLE CANADA, MINNESOTA NONMAJOR DEBT SERVICE FUNDS COMBINING STATEMENT OF REVENUE, EXPENDITURES, AND CHANGES IN FUND BALANCES YEAR ENDED DECEMBER 31, 2022 WITH COMPARATIVE TOTALS FOR YEAR ENDED DECEMBER 31, 2021 (84) Canabury Canabury Square G.O Bonds GO Bonds Condos Notes Condos HIA 2014A 2015A 2022 2021 (375) (362) (310) (320) Totals Totals REVENUE Special Assessments: Current and Delinquent 5,344$ 145,500$ -$ -$ 150,844$ 5,417$ Prepayments on Deferred 516 114,168 - - 114,684 844 Penalties 17 16,400 - - 16,417 21 Total Revenue 5,877 276,068 - - 281,945 6,282 EXPENDITURES Current: General Government 220 340 220 220 1,000 750 Debt Service: Principal Retirement - 7,189 150,000 135,000 292,189 292,190 Interest 262 6,978 74,350 13,403 94,993 94,252 Other Fiscal Charges - - 475 475 950 950 Miscellaneous 47 198 750 - 995 800 Total Debt Service 529 14,705 225,795 149,098 390,127 388,942 EXCESS (DEFICIENCY) OF REVENUE OVER (UNDER) EXPENDITURES 5,348 261,363 (225,795) (149,098) (108,182) (382,660) OTHER FINANCE SOURCES Transfers In - - 225,795 149,098 374,893 375,978 NET CHANGE IN FUND BALANCES 5,348 261,363 - - 266,711 (6,682) FUND BALANCES Beginning of Year (7,894) (227,487) 82,931 - (152,450) 81,719 End of Year (2,546)$ 33,876$ 82,931$ -$ 114,261$ 75,037$ NONMAJOR CAPITAL PROJECTS FUNDS Nonmajor capital project funds are used to account for the financial resources to be used for the acquisition or construction of major capital facilities. Ten Percent Charitable Gambling – Used to account for amounts received and related to the City’s charitable gambling contributions used for community service projects. Park Acquisition – Used to account for amounts received and related to park acquisition fees. Fire Equipment Replacement – Used to account for amounts received and related to fire department equipment. Fleur Royal Condos HIA– Used to account for amounts received and related expenditures of the Fleur Royale Condos. TIF #2-1 Kandice Heights – Used to account for amounts received and related project expenditures of TIF District #2-2 – Kandice Heights. TIF #3-2 Rice/LC Road – Used to account for amounts received and related project expenditures of TIF District #3-2 – Rice/LC Road. TIF #3-3 The Lodge – Used to account for amounts received and related project expenditures of TIF District #3-3 – The Lodge. TIF #5-1 St. Jude – Used to account for project costs associated with St. Jude expansion and other redevelopment along Rice Street and Highway 36 funded by tax increment financing. TIF #6-1 – Used to account for amounts received and related project expenditures of TIF #6-1. TIF #7-1 Suite Living – Used to account for amounts received and related project expenditures of TIF #7-1 – Suite Living. TIF #7-2 Bix Produce – Used to account for amounts received and related project expenditures of TIF #7-2 – Bix Produce. TIF #7-3 Owasso Warehouse – Used to account for amounts received and related project expenditures of TIF #7-3 – Owasso Warehouse. Owasso/Woodlyn Redevelopment Area – Used to account for amounts received and related expenditures of the Owasso/Woodlyn Redevelopment Area. Twin Lake Boulevard Development – Used to account for activity relating to TIF loan to developer for the Twin Lake Development Project. Water/Sewer Equipment Replacement Fund – Used to account for funds set aside from the City’s water and sewer operating utilities as well as other government sournces of revenue to be used for future equipment replacement and capital costs. THIS PAGE INTENTIONALLY LEFT BLANK CITY OF LITTLE CANADA, MINNESOTA NONMAJOR CAPITAL PROJECTS FUNDS COMBINING BALANCE SHEET DECEMBER 31, 2022 WITH COMPARATIVE TOTALS FOR DECEMBER 31, 2021 (85) Ten Percent TIF #2-1 Charitable Park Fire Equipment Fleur Royale Kandice TIF #3-2 TIF #3-3 TIF #5-1 Gambling Acquisition Replacement Condos HIA Heights Rice/LC Road The Lodge St. Jude (408) (456) (457) (463) (464) (440)(441) (460) ASSETS Cash and Investments 160,307$ 1,317,645$ 1,130,082$ 3,546$ 661,044$ -$ 25,699$ 60,009$ Interund Loan Receivable - - - 2,645 - - - - Accounts Receivable 2,752 - - - - - 368 - Property Taxes Receivable: Delinquent Taxes - - 2,032 - - - 50 - Due from County - - 487 - - - - - Special Assessment Receivable: Deferred - - - - - 29,847 - - Delinquent - - - 8,532 - - - - Special Deferred - - - - - - - - Prepaid Items - - 675,449 - - - - - Property Held for Resale - - - - 316,754 70,401 - - Total Assets 163,059$ 1,317,645$ 1,808,050$ 14,723$ 977,798$ 100,248$ 26,117$ 60,009$ LIABILITIES, DEFERRED INFLOWS OF RESOURCES, AND FUND BALANCE LIABILITIES Accounts and Contracts Payable -$ 1,811$ -$ -$ -$ -$ -$ -$ Interfund Loan Payable - - - - - - - - Total Liabilities - 1,811 - - - - - - DEFERRED INFLOWS OF RESOURCES Unavailable Revenue - Taxes - - 2,032 - - - 50 - Unavailable Revenue - Special Assessments - - - 8,532 - 29,847 - - - - 2,032 8,532 - 29,847 50 - FUND BALANCE Restricted Chartiable Gambling 163,059 - - - - - - - Park Acquisition - 970,931 - - - - - - Fire Equipment - - 496,573 - - - - - Tax Increment - - - - 977,798 70,401 26,067 60,009 Assigned Park Acquisition - 344,903 - - - - - - Fire Equipment - 1,309,445 - - - - - Water and Sewer Equipment - - - - - - - - Redevelopment - - - 6,191 - - - - Unassigned - - - - - - - - Total Fund Balance 163,059 1,315,834 1,806,018 6,191 977,798 70,401 26,067 60,009 Total Liabilities, Deferred Inflows of Resources, and Fund Balance 163,059$ 1,317,645$ 1,808,050$ 14,723$ 977,798$ 100,248$ 26,117$ 60,009$ (86) TIF 7-3 Owasso/ Twin Lake Water/Sewer TIF #7-1 TIF #7-2 Owasso Woodlyn Boulevard Equipment TIF #6-1 Suite Living Bix Produce Warehouse Redevelopment Development Replacement (470) (471) (472) (473) Area (474) (476) (604)2022 2021 -$ 886$ 32,373$ -$ -$ 1,000,000$ 1,742,673$ 6,134,264$ 4,798,498$ - - - - - - 31,125 33,770 8,049 - - - - - - - 3,120 10,754 - 4,528 - - - - - 6,610 1,848 - - - - - - - 487 1,805 - - - - - - - 29,847 - - - - - - - - 8,532 8,575 - - - - - - - - 29,022 - - - - - - - 675,449 - - 313,860 - - - - - 701,015 387,155 -$ 319,274$ 32,373$ -$ -$ 1,000,000$ 1,773,798$ 7,593,094$ 5,245,706$ -$ -$ 29,558$ -$ -$ -$ 3,952$ 35,321$ 129,296$ 363,097 188,480 - 18,230 - - - 569,807 6,417 363,097 188,480 29,558 18,230 - - 3,952 605,128 135,713 - 4,528 - - - - - 6,610 1,848 - - - - - - - 38,379 37,597 - 4,528 - - - - - 44,989 39,445 - - - - - - - 163,059 151,658 - - - - - - - 970,931 877,603 - - - - - - - 496,573 366,573 - 126,266 2,815 - - - - 1,263,356 2,113,112 - - - - - - - 344,903 373,349 - - - - - - - 1,309,445 1,186,884 - - - - - - 1,769,846 1,769,846 - - - - - - 1,000,000 - 1,006,191 12,979 (363,097) - - (18,230) - - - (381,327) (11,610) (363,097) 126,266 2,815 (18,230) - 1,000,000 1,769,846 6,942,977 5,070,548 -$ 319,274$ 32,373$ -$ -$ 1,000,000$ 1,773,798$ 7,593,094$ 5,245,706$ Total Nonmajor Capital Projects Funds THIS PAGE INTENTIONALLY LEFT BLANK CITY OF LITTLE CANADA, MINNESOTA NONMAJOR CAPITAL PROJECTS FUNDS COMBINING STATEMENT OF REVENUE, EXPENDITURES, AND CHANGES IN FUND BALANCES YEAR ENDED DECEMBER 31, 2022 WITH COMPARATIVE TOTALS FOR YEAR ENDED DECEMBER 31, 2021 (87) Ten Percent TIF #2-1 Charitable Park Fire Equipment Fleur Royale Kandice TIF #3-2 TIF #3-3 TIF #5-1 Gambling Acquisition Replacement Condos HIA Heights Rice/LC Road The Lodge St. Jude (408) (456) (457) (463) (464)(440)(441) (460) REVENUE Property Taxes -$ -$ 159,048$ -$ -$ -$ -$ -$ Tax Increments - - - - - - 278,401 187,943 Special Assessments: Current - - - - - - - - Delinquent - - - 43 - - - - Penalties - - - 14 - - - - Charges for Service Investment Earnings (3,362) (28,226) (20,024) 155 (16,623) - (13,842) (2,722) Contributions 29,763 102,363 130,000 - - - - - Miscellaneous Revenue - - - - - - - - Total Revenue 26,401 74,137 269,024 212 (16,623) - 264,559 185,221 EXPENDITURES Current: General Government - 9,255 16,463 - 220 - 220 220 Housing and Economic Development - - - - 868 - 195,083 2,281 Public Works - - - - - - - - Parks and Recreation 15,000 - - - - - - - Capital Outlay: Public Works - - - - - - - - Debt Service: Principal Retirement - - - - - - - - Interest and Fiscal Charges - - - - - - - - Total Expenditures 15,000 9,255 16,463 - 1,088 - 195,303 2,501 EXCESS (DEFICIENCY) OF REVENUE OVER (UNDER) EXPENDITURES 11,401 64,882 252,561 212 (17,711) - 69,256 182,720 OTHER FINANCE SOURCES (USES) Transfers In - - - - - - 96,890 - Transfers Out - - - (7,000) (97,577) - (801,290) (350,545) Total Other Finance Sources (Uses)- - - (7,000) (97,577) - (704,400) (350,545) NET CHANGE IN FUND BALANCE 11,401 64,882 252,561 (6,788) (115,288) - (635,144) (167,825) FUND BALANCES Beginning of Year 151,658 1,250,952 1,553,457 12,979 1,093,086 70,401 661,211 227,834 End of Year 163,059$ 1,315,834$ 1,806,018$ 6,191$ 977,798$ 70,401$ 26,067$ 60,009$ (88) TIF 7-3 Owasso/ Twin Lake Water/Sewer TIF #7-1 TIF #7-2 Owasso Woodlyn Boulevard Equipment TIF #6-1 Suite Living Bix Produce Warehouse Redevelopment Development Replacement (470) (471) (472) (473) Area (474) (476)(604)2022 2021 -$ -$ -$ -$ -$ -$ -$ 159,048$ 159,508$ 94,493 77,115 65,684 - - - - 703,636 624,416 - - - - - - 55,098 55,098 - - - - - - - - 43 1,542 - - - - - - - 14 565 - 52,380 52,380 (8,662) (506) - (167) - - - (25,014) (110,331) 64,883 - - - - - - - 262,126 164,322 - - - - 682 - 2,249 2,931 - 93,987 77,115 65,517 - 682 - 84,713 1,124,945 1,006,574 220 220 220 - 220 - 1,520 28,778 1,730 1,880 4,446 60,294 6,919 - - - 271,771 279,089 - - - - - - 28,759 28,759 - - - - - - - - 15,000 15,000 - - - - - - 345,291 345,291 50,802 16,360 - - - - - - 16,360 - - 5,792 - 599 - - - 6,391 350 18,460 10,458 60,514 7,518 220 - 375,570 712,350 346,971 75,527 66,657 5,003 (7,518) 462 - (290,857) 412,595 659,603 - - - - - 1,000,000 375,000 1,471,890 - (1,078) (971) (995) (295) (672,836) - (225,795) (2,158,382) (184,353) (1,078) (971) (995) (295) (672,836) 1,000,000 149,205 (686,492) (184,353) 74,449 65,686 4,008 (7,813) (672,374) 1,000,000 (141,652) (273,897) 475,250 (437,546) 60,580 (1,193) (10,417) 672,374 - 1,911,498 7,216,874 4,595,298 (363,097)$ 126,266$ 2,815$ (18,230)$ -$ 1,000,000$ 1,769,846$ 6,942,977$ 5,070,548$ Total Nonmajor Capital Projects Funds CITY OF LITTLE CANADA, MINNESOTA STATEMENT OF CHANGES IN ASSETS AND LIABILITIES AGENCY FUND YEAR ENDED DECEMBER 31, 2022 (89) Balance Balance January 1, December 31, 2022 Additions Deletions 2022 ASSETS Cash -$ 58,185$ 57,310$ -$ Due from Developers - 3,707 - 3,707 Accounts Receivable - - - - Total Assets -$ 61,892$ 57,310$ 3,707$ LIABILITIES Developer Deposits -$ 58,185$ 53,603$ 3,707$ Accounts Payable - - - - Total Liabilities -$ 58,185$ 53,603$ 3,707$ This part of Little Canada, Minnesota’s Comprehensive Annual Financial Report presents detailed information as a context for understanding what information in the financial statements, note disclosures, and required supplementary information says about City’s overall financial health. Contents Financial Trends These schedules contain trend information to help the reader understand how the City’s financial performance and well-being have changed over time. Revenue Capacity These schedules contain information to help the reader assess the City’s most significant local revenue source, the property tax. Debt Capacity These schedules contain information to help the reader assess the affordability of the City’s current level of outstanding debt and the City’s ability to issue additional debt in the future. Demographic and Economic Information These schedules offer demographic and economic indicators to help the reader understand the environment within the City which the City’s financial activities take place. Operating Information These schedules contain service and infrastructure data to help the ready understand how the information in the City’s financial report relates to services the City provides and activities it performs. Source: Unless otherwise noted, the information in these schedules is derived from the CAFR for the relevant year. CITY OF LITTLE CANADA, MINNESOTA NET POSITION BY COMPONENT LAST TEN FISCAL YEARS (ACCRUAL BASIS OF ACCOUNTING) (90) 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022Governmental Activities:Net Investment in Capital Assets24,608,426$ 18,307,783$ 22,521,602$ 27,235,568$ 29,029,105$ 25,481,497$ 24,872,181$ 26,565,229$ 26,571,556$ 27,802,478$ Restricted1,873,860 5,167,835 4,098,590 6,817,513 5,247,575 4,622,305 3,757,032 3,348,157 3,679,079 5,133,373 Unrestricted9,956,070 13,173,072 10,712,592 8,613,516 11,634,405 11,371,563 13,185,534 15,280,953 15,630,921 15,283,670 Total Governmental Activities Net Position 36,438,356$ 36,648,690$ 37,332,784$ 42,666,597$ 45,911,085$ 41,475,365$ 41,814,747$ 45,194,339$ 45,881,556$ 48,219,521$ Business-Type Activities:Net Investment in Capital Assets9,330,564$ 9,261,283$ 8,966,437$ 8,600,858$ 8,484,312$ 8,109,979$ 8,218,320$ 7,993,507$ 7,638,793$ 7,596,291$ Unrestricted1,458,574 1,524,741 1,368,591 1,478,043 1,559,875 1,721,584 2,061,168 2,239,699 2,549,253 2,618,114 Total Business-Type Activities Net Position 10,789,138$ 10,786,024$ 10,335,028$ 10,078,901$ 10,044,187$ 9,831,563$ 10,279,488$ 10,233,206$ 10,188,046$ 10,214,405$ Primary Government:Net Investment in Capital Assets33,938,990$ 27,569,066$ 31,488,039$ 35,836,426$ 37,513,417$ 33,591,476$ 33,090,501$ 34,558,736$ 34,210,349$ 35,398,769$ Restricted1,873,860 5,167,835 4,098,590 6,817,513 5,247,575 4,622,305 3,757,032 3,348,157 3,679,079 5,133,373 Unrestricted11,414,644 14,697,813 12,081,183 10,091,559 13,194,280 13,093,147 15,246,702 17,520,652 18,180,174 17,901,784 Total Primary Government Net Position 47,227,494$ 47,434,714$ 47,667,812$ 52,745,498$ 55,955,272$ 51,306,928$ 52,094,235$ 55,427,545$ 56,069,602$ 58,433,926$ CITY OF LITTLE CANADA, MINNESOTA CHANGES IN NET POSITION LAST TEN FISCAL YEARS (ACCRUAL BASIS OF ACCOUNTING) (91) 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022Expenses:Governmental Activities:General Government1,232,438$ 1,249,420$ 731,727$ 863,508$ 989,667$ 1,868,590$ 631,388$ 670,229$ 761,904$ 897,492$ Housing and Economic Development- - - - - - 690,771 226,265 282,710 274,253 Public Safety1,918,113 1,855,021 2,052,997 2,164,959 2,257,152 2,241,544 2,696,716 2,654,736 2,585,476 2,658,787 Public Works2,290,440 2,109,119 1,921,717 2,078,129 2,406,904 2,420,772 2,128,271 2,361,195 2,187,357 2,431,627 Sanitation and Recycling- - - - - - 413,046 448,249 462,250 476,404 Culture and Recreation1,065,886 1,183,221 951,271 1,054,644 1,128,254 1,274,088 688,124 624,376 717,520 922,706 Interest and Fiscal Charges409,478 414,322 463,871 381,324 325,328 289,276 235,062 166,152 123,869 108,818 Total Governmental Activities Expenses6,916,355 6,811,103 6,121,583 6,542,564 7,107,305 8,094,270 7,483,378 7,151,202 7,121,086 7,770,087 Business-Type Activities:Water1,578,265 1,647,546 1,434,649 1,575,608 1,631,920 1,574,293 1,566,206 1,669,453 1,766,622 1,968,973 Sewer1,427,872 1,176,551 1,260,916 1,327,205 1,434,384 1,480,413 1,319,392 1,503,306 1,514,193 1,616,403 Total Business-Type Activities Expenses3,006,137 2,824,097 2,695,565 2,902,813 3,066,304 3,054,706 2,885,598 3,172,759 3,280,815 3,585,376 Total Primary Government Expenses9,922,492$ 9,635,200$ 8,817,148$ 9,445,377$ 10,173,609$ 11,148,976$ 10,368,976$ 10,323,961$ 10,401,901$ 11,355,463$ Program Revenues:Governmental Activities:Charges for Services:General Government123,724$ 134,941$ 162,726$ 168,944$ 202,180$ 253,121$ 604,268$ 291,860$ 282,502$ 118,794$ Housing and Economic Development- - - - - - 61,290 - 18,875 46,599 Public Safety266,566 273,458 416,622 590,694 329,752 348,628 68,562 120,083 37,227 608,290 Public Works178,742 20,310 479,325 976,979 2,419,648 14,040 35,302 63,436 33,955 35,142 Sanitation and Recycling- - - - - - 436,270 468,554 485,066 508,780 Culture and Recreation992,462 919,138 957,752 1,137,228 979,920 1,636,194 43,996 22,384 50,660 630,918 Operating Grants and Contributions919,636 259,590 283,767 279,581 268,981 287,601 638,471 1,084,749 343,816 698,238 Capital Grants and Contributions2,422,795 740,823 285,557 3,133,441 1,224,118 680,448 733,734 1,980,479 1,019,104 1,225,082 Total Governmental Activities Program Revenues4,903,925 2,348,260 2,585,749 6,286,867 5,424,599 3,220,032 2,621,893 4,031,545 2,271,205 3,871,843 Business-Type Activities:Charges for Services:Water1,538,520 1,512,217 1,518,762 1,559,185 1,604,792 1,641,723 1,625,833 1,708,035 1,885,928 1,955,504 Sewer1,365,920 1,239,136 1,270,560 1,316,749 1,408,157 1,428,823 1,461,517 1,471,654 1,598,585 1,656,428 Capital Grants and Contributions- - - 38,700 284,231 40,740 - - - 369,202 Total Business-Type Activities Program Revenues2,904,440 2,751,353 2,789,322 2,914,634 3,297,180 3,111,286 3,087,350 3,179,689 3,484,513 3,981,134 Total Primary Government Program Revenues7,808,365$ 5,099,613$ 5,375,071$ 9,201,501$ 8,721,779$ 6,331,318$ 5,709,243$ 7,211,234$ 5,755,718$ 7,852,977$ Fiscal Year CITY OF LITTLE CANADA, MINNESOTA CHANGES IN NET POSITION (CONTINUED) LAST TEN FISCAL YEARS (ACCRUAL BASIS OF ACCOUNTING) (92) 2013 2014 2015 2016 2017 2018 2019 2020 2017 2022Net Revenue (Expense):Governmental Activities(2,012,430)$ (4,462,843)$ (3,535,834)$ (255,697)$ (1,682,706)$ (4,874,238)$ (4,861,485)$ (3,119,657)$ (4,849,881)$ (3,898,244)$ Business-Type Activities(101,697) (72,744) 93,757 11,821 230,876 56,580 201,752 6,930 203,698 395,758 Total Primary Government Net Expense(2,114,127)$ (4,535,587)$ (3,442,077)$ (243,876)$ (1,451,830)$ (4,817,658)$ (4,659,733)$ (3,112,727)$ (4,646,183)$ (3,502,486)$ General Revenues and Other Changes in Net Position:Governmental Activities:Property Taxes2,718,580$ 2,832,040$ 2,892,772$ 2,907,828$ 3,037,308$ 3,265,748$ 3,385,222$ 3,514,093$ 3,601,885$ 3,997,591$ Tax Increment Collections1,005,500 1,015,993 962,001 1,173,985 898,922 378,923 538,791 570,105 709,350 466,344 Franchise Taxes- - - - - - 477,274 482,396 478,546 - Unrestricted Grants and Contributions200,237 349,079 382,816 391,125 395,398 435,682 437,161 434,379 434,909 1,070,717 Other General Revenues14,052 23,145 54,272 21,202 14,663 14,920 - - - 576,214 Investment Earnings128,565 476,640 287,683 286,814 316,795 299,521 530,625 442,806 6,597 (301,608) Gain (Loss) on Sale of Capital Assets- 1,000 5,000 508,556 (35,892) - 20,481 40,000 61,373 51,951 Gain on Sale of Future Revenue- - - - - - - 594,000 - - Other- - - - - - 318,000 - - Transfers(257,258) (24,720) 198,571 300,000 300,000 300,000 (188,687) 103,470 244,438 375,000 Special Item- - - - - (4,506,155) - - - - Total Governmental Activities3,809,676 4,673,177 4,783,115 5,589,510 4,927,194 188,639 5,200,867 6,499,249 5,537,098 6,236,209 Business-Type Activities:Other General Revenues3,080 4,852 6,187 7,815 6,863 9,056 2,447 - - 4,044 Investment Earnings2,394 40,058 25,414 24,237 27,547 21,740 55,039 50,258 (4,420) 1,557 Transfers257,258 24,720 (198,571) (300,000) (300,000) (300,000) 188,687 (103,470) (244,438) (375,000) Total Business-Type Activities262,732 69,630 (166,970) (267,948) (265,590) (269,204) 246,173 (53,212) (248,858) (369,399) Total Primary Government4,072,408$ 4,742,807$ 4,616,145$ 5,321,562$ 4,661,604$ (80,565)$ 5,447,040$ 6,446,037$ 5,288,240$ 5,866,810$ Change in Net Position:Governmental Activities1,797,246$ 210,334$ 1,247,281$ 5,333,813$ 3,244,488$ (4,685,599)$ 339,382$ 3,379,592$ 687,217$ 2,337,965$ Business-Type Activities161,035 (3,114) (73,213) (256,127) (34,714) (212,624) 447,925 (46,282) (45,160) 26,359 Total Primary Government1,958,281$ 207,220$ 1,174,068$ 5,077,686$ 3,209,774$ (4,898,223)$ 787,307$ 3,333,310$ 642,057$ 2,364,324$ CITY OF LITTLE CANADA, MINNESOTA FUND BALANCES, GOVERNMENTAL FUNDS LAST TEN FISCAL YEARS (MODIFIED ACCRUAL BASIS OF ACCOUNTING) (93) 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022General Fund:NonspendablePrepaid Items8,844$ 4,855$ 3,590$ 7,148$ 8,389$ 8,769$ 10,807$ 2,381$ 6,904$ 23,052$ Interfund Loan- - 1,309,429 1,244,911 1,090,034 718,024 761,178 554,019 496,985 551,577 Assigned- - - - - - 138,870 819,483 68,500 - Unassigned2,191,138 2,399,847 1,183,140 1,580,457 1,434,580 1,992,378 2,210,615 2,682,015 2,629,475 3,039,880 Total General Fund2,199,982$ 2,404,702$ 2,496,159$ 2,832,516$ 2,533,003$ 2,719,171$ 3,121,470$ 4,057,898$ 3,201,864$ 3,614,509$ All Other Governmental Funds:UnassignedPrepaid Items14,640$ 41,235$ 9,800$ 7,320$ 4,880$ 2,440$ -$ -$ -$ -$ Long-Term Interfund Loan Receivable- - - 288,998 - - - - - - Restricted1,799,622 5,141,330 5,337,152 4,851,410 5,240,271 4,635,460 3,588,108 3,336,454 3,669,877 3,088,726 Committed909,090 985,743 615,306 659,829 726,268 687,800 706,819 718,479 758,336 1,464,755 Assigned8,280,277 6,642,969 7,360,977 5,721,705 7,402,374 8,098,459 8,619,917 8,886,943 10,141,184 10,409,033 Unassigned(1,158,849) (1,162,575) (1,040,759) (875,228) (682,248) (2,306,132) (1,996,451) (1,065,256) (684,537) (383,873) Total All Other Governmental Funds9,844,780$ 11,648,702$ 12,282,476$ 10,654,034$ 12,691,545$ 11,118,027$ 10,918,393$ 11,876,620$ 13,884,860$ 14,578,641$ Total All Funds12,044,762$ 14,053,404$ 14,778,635$ 13,486,550$ 15,224,548$ 13,837,198$ 14,039,863$ 15,934,518$ 17,086,724$ 18,193,150$ Source: City's financial records. CITY OF LITTLE CANADA, MINNESOTA CHANGES IN FUND BALANCES, GOVERNMENTAL FUNDS LAST TEN FISCAL YEARS (MODIFIED ACCRUAL BASIS OF ACCOUNTING) (94) 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022Revenues:Taxes2,730,953$ 2,846,061$ 2,904,266$ 3,009,596$ 3,030,586$ 3,294,816$ 3,398,344$ 3,519,584$ 3,594,163$ 3,763,796$ Franchise Tax336,567 125,594 127,865 133,804 135,557 480,454 477,274 477,184 483,758 469,042 Tax Increment Collections1,006,339 1,016,898 913,126 1,217,988 932,165 467,862 538,791 570,105 709,350 727,497 Special Assessments1,047,045 1,380,810 1,092,822 1,302,179 1,022,706 985,904 680,632 974,538 708,476 803,397 Licenses and Permits219,861 562,968 716,247 904,927 643,841 300,059 497,295 221,328 195,101 562,379 Intergovernmental702,837 537,770 580,382 2,289,007 591,857 644,422 729,203 4,015,015 1,103,216 1,522,656 Charges for Services640,900 467,915 509,380 519,062 474,145 487,175 555,480 552,607 627,845 613,645 Fines and Forfeits46,705 46,571 40,325 42,311 44,707 48,569 49,408 24,151 40,440 45,911 Investment Earnings128,565 490,497 302,870 286,814 316,795 299,521 530,625 442,497 6,649 (301,608) Connection Charges- - - - - - 51,120 260 1,200 - Contributions & Donations150,929 102,235 136,826 294,559 102,107 140,461 239,716 197,168 254,825 466,810 Miscellaneous1,753,297 193,005 810,513 1,180,067 2,824,153 293,261 755,184 1,200,313 103,044 564,019 Total Revenues8,763,998 7,770,324 8,134,622 11,180,314 10,118,619 7,442,504 8,503,072 12,194,750 7,828,067 9,237,544 Expenditures:General Government1,199,753 610,946 532,783 725,713 964,130 1,414,365 515,613 575,115 657,298 688,102 Housing & Economic Development- - - - - - 690,771 226,265 282,710 271,771 Public Safety1,821,496 1,914,846 1,976,340 2,029,462 2,185,949 2,311,243 2,492,581 2,557,076 2,463,411 2,527,832 Public Works1,597,274 348,496 465,709 424,927 533,914 460,543 484,906 514,870 463,823 567,401 Sanitation and Recycling- - - - - - 413,046 448,249 462,250 476,404 Culture and Recreation995,854 908,230 919,326 925,496 899,477 1,515,483 572,853 554,358 612,420 696,872 Capital Outlay2,447,618 4,773,436 3,944,063 6,469,797 3,186,475 1,579,493 1,943,411 5,283,521 1,758,160 3,361,857 Debt Service:Principal528,406 525,100 690,792 876,470 622,069 1,863,094 1,268,077 301,859 299,237 308,549 Interest411,671 369,763 475,330 428,465 362,261 318,745 244,372 176,764 134,339 103,929 Fiscal Charges2,722 22,020 21,615 625 447 1,290 950 950 950 950 Miscellaneous- 72,776 45,280 - - 477 8,327 1,068 1,038 995 Total Expenditures9,004,794 9,545,613 9,071,238 11,880,955 8,754,722 9,464,733 8,634,907 10,640,095 7,135,636 9,004,662 Excess (Deficiency) of Revenues Over (Under) Expenditures(240,796) (1,775,289) (936,616) (700,641) 1,363,897 (2,022,229) (131,835) 1,554,655 692,431 232,882 Other Financing Sources (Uses):Transfers In2,270,044 1,025,322 1,956,117 1,801,318 1,713,060 1,185,418 1,916,745 1,200,585 1,699,798 2,623,682 Transfers Out(1,970,044) (725,322) (1,656,117) (1,501,318) (1,413,060) (885,418) (1,616,745) (900,585) (1,399,798) (2,248,682) Bonds Issued- 3,400,000 1,335,000 - - - - - - - Premium on Bonds Issued- 82,931 21,847 - - - - - - - Payment to Refunded Bond Escrow- - - (1,400,000) - - - - - - Sales of Capital Assets- 1,000 5,000 508,556 74,101 85,000 34,500 40,000 159,775 498,543 Total Other Financing Sources (Uses)300,000 3,783,931 1,661,847 (591,444) 374,101 385,000 334,500 340,000 459,775 873,543 Net Change in Fund Balances59,204$ 2,008,642$ 725,231$ (1,292,085)$ 1,737,998$ (1,637,229)$ 202,665$ 1,894,655$ 1,152,206$ 1,106,425$ Debt Service as a Percentage of Noncapital Expenditures16.1% 15.6% 21.9% 23.3% 16.3% 26.5% 20.3% 6.8% 7.9% 6.9% CITY OF LITTLE CANADA, MINNESOTA TAX REVENUE BY SOURCES, GOVERNMENTAL FUNDS LAST TEN FISCAL YEARS (ACCRUAL BASIS OF ACCOUNTING) (95) Fiscal Property TaxYear Tax Increment Total2013 2,718,580$ 1,005,500$ 3,724,080$ 2014 2,832,040 1,015,993 3,848,033 2015 2,892,772 962,002 3,854,774 2016 2,907,828 1,173,985 4,081,813 2017 3,037,308 898,922 3,936,230 2018 3,265,748 378,923 3,644,671 2019 3,285,222 538,791 3,824,013 2020 3,514,093 570,105 4,084,198 2021 3,601,885 709,350 4,311,235 2022 3,763,796 727,497 4,491,293 CITY OF LITTLE CANADA, MINNESOTA TAX CAPACITY VALUE AND ESTIMATED MARKET VALUE OF TAXABLE PROPERTY LAST TEN FISCAL YEARS (96) All TotalLess: Fiscal DisparityAdjusted Estimated ATC as a Payable Real Other Tax Contribution (Net) Tax Total Direct Taxable Market Percentage ofYear Property Property Capacity and TIF Capacity (ATC) Tax RateValue (TMV) TMV2013 10,220,221$ 151,775$ 10,371,996$ (1,485,006)$ 8,886,990$ 30.935 794,711,000$ 1.12%2014 10,107,563 154,770 10,262,333 (1,345,914) 8,916,419 31.407 790,339,600 1.13%2015 10,443,362 165,951 10,609,313 (1,262,817) 9,346,496 30.696 827,861,800 1.13%2016 10,844,959 172,523 11,017,482 (1,319,451) 9,698,031 30.331 861,567,300 1.13%2017 11,460,787 183,565 11,644,352 (1,225,805) 10,418,547 28.903 908,971,000 1.15%2018 12,596,568 193,397 12,789,965 (760,936) 12,029,029 26.664 991,123,400 1.21%2019 13,501,993 187,849 13,689,842 (943,403) 12,746,439 26.131 1,062,909,400 1.20%2020 14,166,929 189,565 14,356,494 (881,058) 13,475,436 25.773 1,125,876,300 1.20%2021 15,498,153 206,261 15,704,414 (906,670) 14,797,744 23.983 1,223,661,200 1.21%2022 15,748,259 108,410 15,856,669 (1,011,054) 14,845,615 25.551 1,247,679,300 1.19%Source: Ramsey County Assessing DepartmentNotes: (1) The tax capacity (assessed taxable value) of the property is calculated by applying a statutory formula to the estimated market value of the property. CITY OF LITTLE CANADA, MINNESOTA DIRECT AND OVERLAPPING TAX RATES LAST TEN FISCAL YEARS (97) Fiscal Year OperatingDebt ServiceTotal City Direct RateSchool District (1)Ramsey CountySpecial DistrictsTotal OverlappingTotal Direct and Overlapping Tax Rate2013 30.935 - 30.935 15.464 65.240 11.520 92.224 123.159 2014 31.407 0.916 32.323 16.251 63.735 11.978 91.964 124.287 2015 30.696 - 30.696 17.180 58.922 11.233 87.335 118.031 2016 30.331 - 30.331 20.958 58.885 11.158 91.001 121.332 2017 28.903 - 28.903 18.894 55.850 10.385 85.129 114.032 2018 26.664 - 26.664 34.396 53.962 10.169 98.527 125.191 2019 26.131 - 26.131 31.687 52.880 9.794 94.361 120.492 2020 25.773 - 25.773 30.668 52.302 9.572 92.542 118.315 2021 23.983 - 23.983 31.250 47.760 8.938 87.948 111.931 2022 25.551 - 25.551 26.914 48.066 11.034 86.014 111.565 Source: Ramsey County Assessing Department(2) Independent School District 623(4) Includes Metropolitan Council, Regional Rail, and Metro WatershedCity of Little Canada Overlapping Rates CITY OF LITTLE CANADA, MINNESOTA PRINCIPAL PROPERTY TAXPAYERS CURRENT YEAR AND NINE YEARS AGO (98) 2013Percentage Percentageof Total of Total City CityNet Tax Tax Net Tax TaxCapacity Capacity Capacity CapacityTaxpayer Value Rank Value Value Rank ValueSt Jude Medical, Inc (Abbott Laboratories) 937,352$ 1 5.91% 529,070$ 1 4.54%Montreal Courts Apartments LLC 582,500 2 3.67% 299,375 2 2.57%GPE LLC 381,990 3 2.41% - Bigos Cedars Lakeside LLC 362,170 4 2.28% - Sale-Leafback MN LLC 286,860 5 1.81% 155,508 6 1.33%Little Canada Senior Properties LLC 272,638 6 1.72% 140,000 7Two S Properties Inc 225,204 7 1.42% 137,134 8 1.18%Lodge Apartments at Little Canada 213,645 8 1.35% 132,050 9 1.13%FAE CRW Little Canada LLC 198,286 9 1.25% - Northern States Power Company (Xcel) 150,019 10 0.96% 159,250 5 1.37%Larson Enterprises - - 275,970 3 2.37%Bellaire Properties, Inc - - 164,156 4 1.41%Individual - - 131,515 10 1.13% Total 3,610,664$ 22.77% 2,124,028$ 18.22%Source: Ramsey County2022 CITY OF LITTLE CANADA, MINNESOTA PROPERTY TAX LEVIES AND COLLECTIONS LAST TEN FISCAL YEARS (99) Collected within theFiscal Year of Levy Total Collections to DateTotal Tax Percentage Collections PercentageFiscal Levy for of in Subsequent of Year Fiscal Year Amount Levy Years Amount Levy2013 2,712,864$ 2,672,767$ 98.52% 39,787$ 2,712,554$ 99.99%2014 2,794,384 2,762,314 98.85% 10,062 2,772,376 99.21%2015 2,878,351 2,841,267 98.71% 25,297 2,866,564 99.59%2016 2,946,318 2,930,802 99.47% 7,359 2,938,161 99.72%2017 3,031,116 2,983,945 98.44% 36,663 3,020,608 99.65%2018 3,241,895 3,196,816 98.61% 10,890 3,207,706 98.95%2019 3,339,258 3,298,056 98.77% (1,719) 3,296,337 98.71%2020 3,479,283 3,440,702 98.89% 6,335 3,447,037 99.07%2021 3,582,330 3,554,561 99.22% - 3,554,561 99.22%2022 3,761,410 3,743,338 99.52% - 3,743,338 99.52% CITY OF LITTLE CANADA, MINNESOTA RATIOS OF OUTSTANDING DEBT BY TYPE LAST TEN FISCAL YEARS (100) General Taxable General General Total Percentage Fiscal Obligation Obligation Tax Notes Revenue Obligation Primary of Personal PerYear Bonds Increment Bonds Payable Bonds Bonds Government Income (1) Capita(1)2013 2,456,458$ 3,505,000$ 261,449$ -$ -$ 6,222,907$ 2.28% 641 2014 5,716,436 3,225,000 231,349 - - 9,172,785 3.17% 925 2015 6,697,743 2,930,000 220,338 - - 9,848,081 3.39% 991 2016 6,016,344 1,355,000 168,863 - - 7,540,207 2.47% 746 2017 5,597,654 1,165,000 137,318 - - 6,899,972 2.16% 682 2018 3,982,296 965,000 104,243 - - 5,051,539 1.42% 486 2019 3,701,938 - 71,166 - - 3,773,104 0.96% 357 2020 3,416,580 - 44,307 - - 3,460,887 0.88% 320 2021 3,126,222 - 25,282 - - 3,151,504 0.71% 291 2022 2,830,864 - 18,093 - - 2,848,957 0.62% 265 Data sources:(1) See the Demographic and Economic Statistics schedule for personal income and population data.Governmental Activities Business-Type Activities CITY OF LITTLE CANADA, MINNESOTA RATIOS OF GENERAL BONDED DEBT OUTSTANDING LAST TEN FISCAL YEARS (101) Percentage ofGeneral Less: Resources Estimated ActualFiscal Obligation Restricted to Repay Taxable Value PerYear Bonds Principal on Bonds Total of Property (1) Capita (2)2013 5,961,458$ 18,056$ 5,943,402$ 0.75% 612 2014 8,941,436 99,547 8,841,889 1.12% 892 2015 9,627,743 1,412,903 8,214,840 0.99% 826 2016 7,371,344 85,231 7,286,113 0.85% 721 2017 6,762,654 93,554 6,669,100 0.73% 659 2018 4,890,000 90,026 4,799,974 0.48% 462 2019 3,655,000 89,434 3,565,566 0.34% 337 2020 3,380,000 81,719 3,298,281 0.29% 305 2021 3,100,000 75,037 3,024,963 0.25% 279 2022 2,815,000 114,261 2,700,739 0.22% 251 (1) See the Schedule of Assessed Value and Estimated Actual Value of taxable Property for property value data.(2) See the Demographic and Economic Statistics schedule for population data. CITY OF LITTLE CANADA, MINNESOTA DIRECT AND OVERLAPPING DEBT DECEMBER 31, 2022 (102) City of Little Canada% of Debt Share ofNet Debt Applicable OverlappingOutstanding to City DebtCity of Little Canada Direct Debt 2,848,957$ 100.00% 2,848,957$ Overlapping:Ramsey County 178,807,840$ 2.0607% 3,929,584$ School Districts ISD No. 623 (Roseville) 133,937,381 15.3118% 20,508,279 ISD No. 624 (White Bear Lake) 361,997,169 1.2636% 4,574,361 Metro Council 1,584,874,568 0.3034% 4,809,265 Total Overlapping33,821,489 Total Direct and Overlapping Debt: 2,259,616,958$ 36,670,446$ Source: Ramsey County The percentage of overlapping debt applicable is estimated using taxable assessed property values. Applicable percentages were estimated by determining the portion of the county’s taxable assessed value that is within the government’s boundaries and dividing it by the county’s total taxable assessed value.Overlapping governments are those that coincide, at least in part, with the geographic boundaries of the City. This schedule estimates the portion of the outstanding debt of those overlapping governments that is borne by the residents and businesses of the City. This process recognizes that, when considering the government’s ability to issue and repay long-term debt, the entire debt burden borne by the residents and businesses should be taken into account. However, this does not imply that every taxpayer is a resident and, therefore, responsible for repaying the debt of each overlapping government. CITY OF LITTLE CANADA, MINNESOTA LEGAL DEBT MARGIN INFORMATION LAST TEN FISCAL YEARS (103) 2013201420152016201720182019202020212022Debt limit 23,841,330$ 23,710,188$ 24,835,854$ 25,847,019$ 27,269,130$ 29,733,702$ 31,887,282$ 33,776,289$ 36,709,836$ 37,430,379$ Total net debt applicable to limit 575,000 3,060,000 1,447,097 2,274,769 2,167,769 2,059,974 1,950,566 1,848,281 1,739,963 1,585,739 Legal debt margin 23,266,330$ 20,650,188$ 23,388,757$ 23,572,250$ 25,101,361$ 27,673,728$ 29,936,716$ 31,928,008$ 34,969,873$ 35,844,640$ Total net debt applicable to the limit as a percentage of debt limit 2.41% 12.91% 5.83% 8.80% 7.95% 6.93% 6.12% 5.47% 4.74% 4.24%Legal Debt Margin Calculation for Fiscal Year 2022:Taxable Market Value 1,247,679,300$ Debt limit (3% of market value) (1) 37,430,379 Debt Applicable to Limit: General Obligation Bonds 1,700,000 Less amount set aside for repayment of General Obligation Debt 114,261 Total Debt applicable to limit 1,585,739 Legal debt margin 35,844,640$ (1) Minnesota State Statutes, Section 475 prescribes the statutory debt limit that outstanding principal of debt cannot exceed 3% of taxable market value. General obligation debt subject to the limitation may be offset by amounts set aside for repaying general obligation bonds.Fiscal Year CITY OF LITTLE CANADA, MINNESOTA DEMOGRAPHIC AND ECONOMIC STATISTICS LAST TEN FISCAL YEARS (104) PerCapita School SchoolFiscal Personal Personal Enrollment Enrollment UnemploymentYear Population(1) Income (2) Income (2) District #623 (3) District #624 (3) Rate (4)2012 9,987 276,789,705$ 27,715$ 6,848 8,1745.7%2013 9,704 272,653,288 28,097 6,998 8,1474.9%2014 9,912 289,519,608 29,209 7,123 8,1793.9%2015 9,941 290,147,967 29,187 7,530 8,2203.6%2016 10,101 305,151,210 30,210 7,547 8,7613.6%2017 10,120 319,053,240 31,527 7,548 9,0683.3%2018 10,386 356,270,958 34,303 7,655 8,8602.7%2019 10,580 392,856,560 37,132 7,684 8,8893.0%2020 10,819 421,583,973 38,967 7,459 8,7056.5%2021 10,830 445,729,719 41,157 7,379 8,4814.0%2022 10,766 456,478,400 42,400 7,356 8,5432.6%Sources:(1) Metropolitan Council Estimate for 2012-2019, 2022. 2020 based on census data. 2021 is estimate by City staff.(2) Per capita personal income is from the Metropolitan Council website. 2020 is estimated by City staff.(3) Minnesota Department of Education, as reported by ISD No. 623 and No. 624.(4) Minnesota Department of Employment and Economic Development. This is for Ramsey County. CITY OF LITTLE CANADA, MINNESOTA PRINCIPAL EMPLOYERS CURRENT YEAR AND NINE YEARS AGO (105) 2022 2013Percentage Percentageof Total of Total Taxpayer Employees Rank Employment Employees Rank EmploymentQ3 (Primoris Service Corporation) 2,250 1 35%Independent School District No. 623 1,198 2 19% 1,060 2 30%Abbott Laboratories 1,191 3 19% 1,126 1 32%Bix Produce 425 4 7%Slumberland, Inc. 400 5 6% 400 3 11%Ouicksilver Express Courier 300 6 5% 300 4 8%Frattalone Excavating 246 7 4% 230 5 6%The House (Active Sports) 150 8 2%Real Estate Masters 118 9 2%Joeૃs Sporting Goods 100 10 2%PreWire Specialists, Inc.130 6 4%McKesson Drug100 7 3%Dock 8680 8 2%Kath Fuel Oil Service55 10 2%Active Sports, Inc. (The House) 75 9 2% Total 6,378 100% 3,556 100%Sources:City of Little Canada Annual Municipal Disclosure Reporting and Little Canada Community Development Department.Note:(1) Q3 Corporate HQ is in Little Canada. This is the company-wide workforce and not all employees work in the City.(2) School District No. 623 includes all school district employees, not all work within the City. CITY OF LITTLE CANADA, MINNESOTA FULL-TIME EQUIVALENT CITY GOVERNMENT EMPLOYEES BY FUNCTION LAST TEN FISCAL YEARS (106) 2013201420152016201720182019202020212022General Government5.80 5.80 5.60 5.50 5.50 5.63 5.63 6.23 6.23 6.38 Public Safety1.50 1.50 1.50 2.00 2.00 1.52 1.52 1.52 1.52 1.52 Public WorksAdministration1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 Maintenance5.40 5.40 5.00 5.10 4.50 4.50 4.50 5.50 5.50 5.60 Culture and RecreationAdministration2.00 2.00 1.50 1.00 1.20 1.48 1.48 1.63 1.85 1.85 Cable production services- - - - - 0.62 0.62 0.18 0.10 - Maintenance3.70 3.70 3.20 3.20 3.50 1.50 1.50 1.50 1.50 1.75 Seasonal- - - - - 2.81 2.81 2.77 2.77 2.77 Total19.40 19.40 17.80 17.80 17.70 19.06 19.06 20.33 20.47 20.87 Source: City of Little Canada Finance OfficeBudgeted Full-time Equivalent Employees as of December 31 CITY OF LITTLE CANADA, MINNESOTA OPERATING INDICATORS BY FUNCTION LAST TEN FISCAL YEARS (107) Function/Program 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022Public SafetyPolice (contract with Ramsey County)Calls for Service 4,740 6,458 7,626 7,011 7,289 6,776 7,086 6,314 6,577 6,645Building/Zoning: Building Permits Issued 229 259 594 302 262 260 304 242 251 502 Land Use Applications 82017171615 9 51010WaterConnections 2,530 2,538 2,550 2,562 2,567 2,571 2,573 2,573 2,576 2,573Water Pumped (in 1,000's of gallons) 373,346 353,219 344,782 347,800 351,866 262,060 336,005 353,604 382,190 383,504WastewaterConnections 2,411 2,419 2,431 2,442 2,447 2,450 2,452 2,452 2,542 2,455Sewer Flow (in 1,000's of gallons) 349,800 393,100 358,200 343,300 345,400 349,600 346,300 365,400 371,020 401,300Sources: Various City DepartmentsFiscal Year CITY OF LITTLE CANADA, MINNESOTA CAPITAL ASSET STATISTICS BY FUNCTION LAST TEN FISCAL YEARS (108) Function/Program 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022Public SafetyFireStations 1111111111Public WorksStreets (miles) 74 74 74 74 74 74 74 74 74 74Streetlights 368 368 368 368 368 368 368 368 368 368Parks (acreage)Parks (acreage) 88 88 97 97 97 97 97 97 97 123Parks 88999999910WaterWater mains (miles) 39393939393939393939Booster stations 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00Water tower 1111111111Maximum daily capacity (1,000's of gallons) 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000Sanitary SewerSanitary sewers (miles) 35353535353535353535Pumping stations 8899999999Sources: Various City DepartmentsFiscal Year STAFF REPORT TO: Mayor Fischer and Members of the City Council FROM: Don Smiley, Fire Chief Bryce Shearen, CPRE, Parks & Recreation/Community Services Director DATE: July 26, 2023 RE: Approve Purchase of Tables & Chairs at the Fire Station ACTION TO BE CONSIDERED Motion to approve the purchase of new tables and chairs at the Little Canada Fire Station from Innovative Office Solutions in the amount of $41,982.19. BACKGROUND The current tables and chairs at the fire station are the original tables and chairs that were purchased when the building was constructed over 30 years ago. The Fire Department has taken good care of them but they have reached their end of life and are now in need of replacement. The Fire Department took a comprehensive look at what was needed for new tables and chairs at the Department. The new tables and chairs in the training room will be the “nesting” style on wheels that will allow for them to be easily moved for different types of training that the firefighters do throughout the year in that room. The Fire Department is also adding four tables to the lobby area to better serve the needs of the Department. The City will attempt to sell the current furniture, but City staff has been advised that there is a surplus of office furniture on the market with many individuals working from home. If the City cannot remove the furniture prior to installation, the quote has a removal fee. If the City is successful in the removal of the furniture the removal fee that is included in the quote would not charged. The replacement of the table and chairs is a budgeted item in the 2023-2032 Capital Improvement Plan (CIP). The amount of the purchase is classified as a Major Purchase ($25,000 to $174,999) in the City’s purchasing policy. Approval from a Department Head, City Administrator, and City Council is necessary before making the purchase. Additionally, the purchase is utilizing a cooperative purchase agreement pricing through CMERDC which satisfies the City’s competitive procurement requirement. SOURCE OF FUNDS $57,000 was budgeted for this project in the 2023 Capital Improvement Plan utilizing Fund 457. The quoted amount of $41,982.19 is $15,017.81 less than the budgeted amount. STAFF RECOMMENDATIONS The Little Canada Fire Department Board of Directors and City Staff recommends the approval of purchasing new tables and chairs at the Little Canada Fire Department. ATTACHMENTS • Innovative Office Solutions Quote 952.808.9900 | 866.574.5389 INNOVATIVEOS.COM SALES PERSON Reed Walhof 952-698-9219 rwalhof@innovativeos.com PROPOSAL DATE 07/20/2023 CUSTOMER NAME CITY OF LITTLE CANADA CUSTOMER NUMBER C102356 CUSTOMER PO ORDER NAME CITY OF LITTLE CANADA ORDER NUMBER 208988 PROJECT NUMBER TERMS NET30 Page 1 of 6 BILL TO CITY OF LITTLE CANADA 515 LITTLE CANADA RD E LITTLE CANADA, MN 55117-1633 ATTN: Bryce Shearen Phone: 651-766-4045 Email: bryce.c.shearen@littlecanadafire.org SHIP TO LITTLE CANADA FIRE DEPARTMENT 325 LITTLE CANADA RD E LITTLE CANADA, MN 55117-1628 ATTN: Bryce Shearen Phone: 651-766-4045 Email: bryce.c.shearen@littlecanadafire.org GROUP EXTENDED AMOUNT Board Room 5,494.28 LINE DESCRIPTION QUANTITY UNIT PRICE EXTENDED AMOUNT 7 HTLB48144--.E-DP-.N-$(L2STD)-.LPT1 Preside 144W x 48D Boat Shaped Laminate Top .E:T-Mold DP:Portico Teak .N:No Grommets $(L2STD):Grd L2 Standard Laminates .LPT1:Portico Teak Tag: Tag TG: Board Room Tag L1: Board Room 1.00 Each 646.36 646.36 8 HTLP144--$(L2STD)-.LPT1 Preside Laminate Panel Base For 144" W Table Tops $(L2STD):Grd L2 Standard Laminates .LPT1:Portico Teak Tag: Tag TG: Board Room Tag L1: Board Room 1.00 Each 347.16 347.16 9 HTLCRED42--$(L2STD)-.LPT1-.DP-$(L2STD)-.LPT1-.J-.N Preside 20x42 36H Hospitality Credenza $(L2STD):Gr L2 Standard Laminates .LPT1:Portico Teak .DP:Portico Teak $(L2STD):Gr L2 Standard Laminates .LPT1:Portico Teak .J:Loop Satin Nickel .N:No Cutout Tag: Tag TG: Board Room Tag L1: Board Room 1.00 Each 1,158.52 1,158.52 10 H5711--$(1)-.GA-10-.T Volt 5720 Series Task Mesh Bck Pneu Swivel Tilt $(1):I Upholstery .GA:GA Fabric 10:Black .T:Black Tag: Tag TG: Board Room 12.00 Each 226.60 2,719.20 cmERDC Contract Contract Number: ERDCHONN.JP.MN.05312025 952.808.9900 | 866.574.5389 INNOVATIVEOS.COM SALES PERSON Reed Walhof 952-698-9219 rwalhof@innovativeos.com PROPOSAL DATE 07/20/2023 CUSTOMER NAME CITY OF LITTLE CANADA CUSTOMER NUMBER C102356 CUSTOMER PO ORDER NAME CITY OF LITTLE CANADA ORDER NUMBER 208988 PROJECT NUMBER TERMS NET30 Page 2 of 6 Tag L1: Board Room 11 H5795--.T 5700 Series Height Adjustable Arms .T:Black Tag: Tag TG: Board Room Tag L1: Board Room 12.00 Each 51.92 623.04 GROUP EXTENDED AMOUNT Front Lobby 1,288.32 LINE DESCRIPTION QUANTITY UNIT PRICE EXTENDED AMOUNT 12 HIWM1--.A-.H-.M-$(1)-.ENSB-31-.T-.SB Ignition Wk Mid-bck Pneu Swivel tilt Tilt Bck Ht Adj .A:Height and Width Adj .H:Hard (Standard) .M:Mesh Back $(1):Gr 1 UPH .ENSB:Ensemble 31:Slate .T:Black .SB:Standard Base Tag: Tag TG: Front Lobby Tag L1: Front Lobby 3.00 Each 429.44 1,288.32 GROUP EXTENDED AMOUNT Main Lobby 7,599.68 LINE DESCRIPTION QUANTITY UNIT PRICE EXTENDED AMOUNT 1 HMG1--.N-.R-.CR-.PR8 Motivate 4-Leg Stack Chair-Set/2 .N:No Arm .R:Rubber Glide .CR:Cherry .PR8:Silver Texture Tag: Tag TG: Main Lobby Tag L1: Main Lobby 3.00 Each 345.84 1,037.52 2 HMG5--.F-.R-.ON-.PR8 Motivate 4-Leg Cafe Ht Stool .F:Fixed Arm .R:Rubber Glide .ON:Onyx .PR8:Silver Texture Tag: Tag TG: Main Lobby Tag L1: Main Lobby 12.00 Each 263.12 3,157.44 3 HCTRND42--.N-$(L2STD)-.LPT1-.DP Arrange Table 42" Round Top .N:No Grommet 2.00 Each 269.28 538.56 952.808.9900 | 866.574.5389 INNOVATIVEOS.COM SALES PERSON Reed Walhof 952-698-9219 rwalhof@innovativeos.com PROPOSAL DATE 07/20/2023 CUSTOMER NAME CITY OF LITTLE CANADA CUSTOMER NUMBER C102356 CUSTOMER PO ORDER NAME CITY OF LITTLE CANADA ORDER NUMBER 208988 PROJECT NUMBER TERMS NET30 Page 3 of 6 $(L2STD):Grd L2 Standard Laminates .LPT1:Portico Teak .DP:Portico Teak Tag: Tag TG: Main Lobby Tag L1: Main Lobby 4 HCT29LX--$(P1)-.PLAT Arrnge Seated Hght X-base for 42-48" Srfc $(P1):P1 Paint Opts .PLAT:Platinum Textured Tag: Tag TG: Main Lobby Tag L1: Main Lobby 2.00 Each 345.40 690.80 5 HCT42SX--$(P1)-.PLAT Arrange Cafe Height X-base for 24-30" Surfaces $(P1):P1 Paint Opts .PLAT:Platinum Textured Tag: Tag TG: Main Lobby Tag L1: Main Lobby 4.00 Each 345.40 1,381.60 6 HCTSQR30--.N-$(L2STD)-.LPT1-.DP Arrange Table 30" Square Top .N:No Grommet $(L2STD):Grd L2 Standard Laminates .LPT1:Portico Teak .DP:Portico Teak Tag: Tag TG: Main Lobby Tag L1: Main Lobby 4.00 Each 198.44 793.76 GROUP EXTENDED AMOUNT Training Room 22,784.52 LINE DESCRIPTION QUANTITY UNIT PRICE EXTENDED AMOUNT 13 HMVR-2472G-NS--.N-$(L2STD)-.LPT1-.DP-.C-$(P1)-.P Motivate Table Rect 24Dx72W 2mm Edge Nesting Base .N:No Grommets $(L2STD):Grd L2 Standard Laminates .LPT1:Portico Teak .DP:Portico Teak .C:Caster $(P1):P1 Paint Opts .P:Black Tag: Tag TG: Training Room Tag L1: Training Room 12.00 Each 715.88 8,590.56 14 HMN2--.F-.H-.IM-.ON-$(1)-.CU-10-.CBK Motivate Nest/Stack Chair-Flex Bck-Uph Seat .F:Fixed Arm .H:Hard .IM:4-Way Black .ON:Onyx 36.00 Each 363.00 13,068.00 952.808.9900 | 866.574.5389 INNOVATIVEOS.COM SALES PERSON Reed Walhof 952-698-9219 rwalhof@innovativeos.com PROPOSAL DATE 07/20/2023 CUSTOMER NAME CITY OF LITTLE CANADA CUSTOMER NUMBER C102356 CUSTOMER PO ORDER NAME CITY OF LITTLE CANADA ORDER NUMBER 208988 PROJECT NUMBER TERMS NET30 Page 4 of 6 $(1):Gr 1 UPH .CU:Centurion 10:Black .CBK:Charblack Tag: Tag TG: Training Room Tag L1: Training Room 15 HLTV2466TMOD-33--$(L2STD)-.LPT1-.P-$(P1)-.P8T SmartLink 24x66 Rectangle Teach Desk w/ Modesty $(L2STD):Grd L2 Standard Laminates .LPT1:Portico Teak .P:Black $(P1):P1 Paint Opts .P8T:Titanium Tag: Tag TG: Training Room Tag L1: Training Room 1.00 Each 1,125.96 1,125.96 GROUP EXTENDED AMOUNT X-Services 4,815.39 LINE DESCRIPTION QUANTITY UNIT PRICE EXTENDED AMOUNT 16 FURNINSTALL Furniture Installation 1.00 Each 3,330.77 3,330.77 17 FURNINSTALL Furniture Removal 1.00 Each 1,484.62 1,484.62 Remit to address for deposits: INNOVATIVE OFFICE SOLUTIONS – LOCKBOX # 131434 PO BOX 1414 MINNEAPOLIS, MN 55480 – 1414 PROPOSAL VALID FOR 14 DAYS SUBTOTAL $41,982.19 TOTAL $41,982.19 Thank you for the opportunity to partner together. Please review the quotation and let us know if you have any questions. Signature: _________________________Name:_______________________ Title:___________________ Date: ___________ 952.808.9900 | 866.574.5389 INNOVATIVEOS.COM SALES PERSON Reed Walhof 952-698-9219 rwalhof@innovativeos.com PROPOSAL DATE 07/20/2023 CUSTOMER NAME CITY OF LITTLE CANADA CUSTOMER NUMBER C102356 CUSTOMER PO ORDER NAME CITY OF LITTLE CANADA ORDER NUMBER 208988 PROJECT NUMBER TERMS NET30 Page 5 of 6 THANK YOU FOR THE OPPORTUNITY We are thrilled for the opportunity to partner together on your project. The terms and conditions below outline a working understanding for the project journey and is intended to set both organizations up for success. If you have questions or concerns, please contact us directly. QUOTES AND PRICING Please review your final project plan and quote to confirm it will fit your space and workplace needs. Quoted prices are good for 14 days from the date of the proposal. Due to the volatile transportation conditions in 2022 & 2023, freight will be billed based upon actual. Unless otherwise noted, prices quoted do not include sales, use, excise, or other applicable taxes. Any applicable taxes will be added or adjusted on the invoice at the time of billing. Buyers exempt from taxes should provide Innovative with copies of exemption certificates prior to placing the order. DESIGN AND ORDERING Innovative’s Design team will work with you and/or your team to design a space that is customized to your budget, style and unique needs to transform your space/s and bring your vision to life. If you do not want to move forward with us on a project, the design work remains the exclusive property of Innovative Office Solutions and we reserve the right to invoice you for the design costs incurred. NEED FOR DEPOSITS A deposit of 50% of the order is required on all projects in excess of $10,000. The deposit is essential as our vendor partners require payment from us when placing orders. Once the deposit is received, we will place your order. Payments must be in the form of check, ACH or wire transfer. Credit cards are not accepted for deposits or other furniture payments over $5,000. PAYMENT TERMS Our Innovative team will send invoices following delivery and installation completion. To ensure a seamless accounting experience, please send payment within 30 days of the invoice date. It is not uncommon for a project to be substantially complete, except for a few punch list items. We appreciate you paying your invoice in full. Innovative will complete your project when outstanding items and/or parts become available. CHANGES Once we receive the sign off on design plan and proposed budget, your order will be placed. Due to the customization of many projects, once orders are placed, most products are not returnable. Modifications or cancellations may result in cancellation or restocking charges by our manufacturer partners. Unfortunately, we will need to invoice you if such charges are incurred. Where a Scope of Work is included with this Agreement, costs resulting from changes in the scope of the project, including any additional requirements or restrictions placed on Innovative will be added to the project price. When Innovative becomes aware of the nature and impact of the change, you will be notified, and all project paperwork will be updated as necessary. In this instance, a revised quote will be generated for signoff. PROJECT DELAYS AND STORAGE We understand projects are occasionally delayed. This may mean you are unable to accept product from us as scheduled. When this occurs, Innovative will store your items at no charge for up to 30 days to provide you with additional time to ensure your space is ready for installation. After 30 days, we will provide a quote to continue to store your product, as we want to make sure it is safe and in a secure location. DELIVERY AND RECEIPT OF PRODUCT We will contact you once we are notified your product has been shipped and is on its way. Your product will be delivered during regular business hours. In order to provide an exceptional delivery experience, we ask that you inform us of any unique circumstances that a driver or install team may face during a delivery. This may include such challenges as a downtown location or the need for a liftgate. Providing us with this information ensures that product is delivered to the proper location within your facility and will reduce the chances of damage to any of the items. We kindly ask you to inspect all product directly shipped and/or delivered and brought onto the job site as scheduled. If you discover product has been damaged or shipped in error during the receiving process, please notify us within 24 hours to ensure that appropriate claims can be 952.808.9900 | 866.574.5389 INNOVATIVEOS.COM SALES PERSON Reed Walhof 952-698-9219 rwalhof@innovativeos.com PROPOSAL DATE 07/20/2023 CUSTOMER NAME CITY OF LITTLE CANADA CUSTOMER NUMBER C102356 CUSTOMER PO ORDER NAME CITY OF LITTLE CANADA ORDER NUMBER 208988 PROJECT NUMBER TERMS NET30 Page 6 of 6 filed. After product arrives at your site, any loss or damage caused by other trades or by weather, fire or other elements is your responsibility. INSTALLATION PREMISES CONDITIONS It is our sincere priority to make sure the installation of your product is timely, professional, and as efficient as possible. To facilitate this, we ask the site to be clean, clear, and free of debris prior to installation. The jobsite should have proper lighting, heat, power source, hoisting and/or elevator service and suitable unobstructed dock space and a secured staging area. The job site shall also be free of the interference of other trades in the area where installation is taking place. We understand in certain situations spaces are not ready for installation when the initial date was scheduled. If this is the case, please provide at least a 48-hour notice so we can keep your project on track to the best of our ability. If proper, timely communication does not occur, unfortunately additional charges may be invoiced to cover costs incurred. Our Installation Team installs product based on the final approved layout. If there are any changes to the final plan, please make sure these are addressed prior to the installation date. WARRANTY Each manufacturing partner of Innovative has a warranty standard. For more information on warranty details, reach out to your Innovative Account Executive. Warrantied product replacements may require billable installation services. CLAIMS Innovative will help resolve claims concerning damaged and/or defective product, materials and/or workmanship made within the warranty period as stated by the manufacturer, supplier, or fabricator. We will arrange for the repair or replacement of any damaged or defective items and/or installation to make sure the project is successful. FORCE MAJEURE We will do our absolute best to ensure we can secure and install your product, but if there are reasons beyond our control, Innovative will not be liable. Reasons include but are not limited to, strikes, pandemics, embargos, war or other breakout of hostilities, acts of God, machinery breakdowns, delays of carriers or suppliers, and domestic or foreign governmental acts or regulations. GOVERNING LAW This agreement shall be governed by and construed according to the laws of the State of Minnesota. ARBITRATION We want to make this a true partnership and resolve any issues that may occur. Any controversies or claims arising relating to this contract will be settled by arbitration administered by the American Arbitration Association. They will fall under its commercial rules, and judgment on the award rendered by the arbitrator(s) may be entered in any court with authority. The award shall include the costs of arbitration and the legal fees of the prevailing party. THANK YOU FOR YOUR PARTNERSHIP Innovative Office Solutions is built upon a “relationships matter” belief system, and every project matters to us. We are thankful for the opportunity to partner together, and we look forward to serving you! ___________________________________Authorized Signature _________________Date STAFF REPORT TO:Mayor Fischer and Members of the City Council FROM:Heidi Heller, City Clerk/HR Manager Corrin Wendell, Community Development Director Bryce Shearen, Parks & Rec/Community Services Director DATE:July 26, 2023 RE:2023-2024 Youth Commissioner Appointments ACTION REQUESTED A motion to reappoint Youth Commissioners Alexis Lum and Ayanna Churcher to 1-year terms from August 1, 2023-July 31, 2024. BACKGROUND Youth Commissioner terms run for 1-year from August 1 – July 31 and Youth Commissioners can serve up to three full terms. The terms of office for Youth Planning Commissioner Alexis Lum and Youth Parks & Rec Commissioner Ayanna Churcher will expire on July 31, 2023. The City has received requests for reappointment from Alexis Lum and Ayanna Churcher. Both are the first City of Little Canada youth commissioners and began serving on their commissions in December 2022. Since this is the first time the City has included youth on the Commissions, and Alexis and Ayanna have only had the opportunity to serve part of a term, staff recommends that both Alexis and Ayanna be reappointed for 1-year terms beginning on August 1, 2023. City Staff has enjoyed adding youth commissioners and are excited to have Alexis and Ayanna continue serve as commissioners. RECOMMENDATION Staff recommends reappointing Alexis Lum to the Planning Commission and Ayanna Churcher to the Parks & Recreation Commission for 1-years terms from August 1, 2023 to July 31, 2024. STAFF REPORT TO: Mayor Fischer and Members of City Council FROM: Heidi Heller, City Clerk/HR Manager DATE: July 26, 2023 RE: Consider Renewal of Tobacco Store License for The Hookah Hideout License Period July 27, 2023 through June 30, 2023 ACTION TO BE CONSIDERED: Consider approval of a Tobacco Store license for The Hookah Hideout located at 3 Little Canada Road East for the period July 27, 2023 – June 30, 2024. BACKGROUND: The City Council received public comment and considered the renewal of a Tobacco Store license at the July 12, 2023 City Council meeting. After a motion to deny the Tobacco Store License failed by a 2-3 vote, the City Council approved a Motion to table the issue until the next meeting on July 26, 2023 by a vote of 4-1. Tobacco licenses are for a one-year term (July 1 – June 30) and require City Council approval. The tobacco store license application for The Hookah Hideout was not complete until June 20, 2023 due to outstanding fire code violation corrections and missing documentation required for the application. The current tobacco store license for the Hookah Hideout was extended to July 12, 2023. The City Council considered this item on July 12 and the existing license was extended to July 26, 2023 when this agenda item was tabled. The City Council requested additional information about current occupancy load for this business at the July 12 City Council meeting. Building Official Steve Westerhaus estimated a maximum occupancy load of 200 based on the type of business use and the approximate area. This number is used to determine the number of bathroom facilities required. Based on a maximum occupancy load of 200 people, the Building Code requires 2 bathrooms, each with 2 toilet facilities and 1 sink. The Building Official has not been inside this space for many years since no building permits have been issued, but staff believes there is currently 1 unisex bathroom, with 1 toilet and 1 sink at the Hookah Hideout. Based on complaints received during public comment related to this business, there may be a need for additional restrooms for the current business. At the July 12, 2023 City Council meeting, the Council also discussed adding conditions to the tobacco store license if was renewed. Potential conditions include establishing specific hours of operation and requiring the owner to ensure the parking lot and sidewalk of the mall are cleaned up after the close of business each day. Due to the concerns raised by neighboring businesses, the recommended hours of operation are from 8:00 a.m. to 11:00 p.m. Staff also drafted an ordinance that amends City Code Chapter 802, Tobacco, to include hours of operation for all tobacco stores as a separate agenda item for the City Council to consider. Another concern that was discussed by City Council members is the ongoing management and control of the Hookah Hideout. According to City Code, Chapter 802.070a (5)iv, the ownership, and management and control of all existing tobacco stores in Little Canada must continue to be the same owner in order to maintain their indoor smoking exception. David Nelson has been the owner of this business since 2011 and has provided a tax document to verify his ownership status. It is substantially more difficult to verify active management of the business, but neighboring business owners have reported not seeing Mr. Nelson for many months and employees do not recognize the name David Nelson, who is the owner of the business. Staff has also received complaints from neighboring businesses about the smell of smoke that permeates into other retail spaces in Thunder Bay mall. STAFF RECOMMENDATION: Staff recommends Council consideration of a tobacco store license for The Hookah Hideout for the period July 27, 2023 to June 30, 2024. Possible Actions for the Council to consider: 1. Approve a Tobacco Store License for The Hookah Hideout for the period July 27, 2023 to June 30, 2024 with the following conditions: a. Hours of Operation for The Hookah Hideout are limited to 8:00 a.m. to 11:00 p.m. b. The Hookah Hideout owner and license holder, David Nelson, and all on-site employees, are responsible for ensuring that the mall parking lot and sidewalk are clean of any and all types of trash after the close of business each day. 2. Motion to deny the Tobacco Store License application for The Hookah Hideout based on the following findings per Little Canada City Code 802.030(b): The applicant has been convicted within the past five years of any violation of a federal, state, or local law, ordinance provision, or other regulation relating to Licensed Products; a. The Hookah Hideout violated Executive Order 20-99 and Executive Order 20-103 by permitting indoor, on-premises consumption of tobacco from Friday, November 20, 2020 at 11:59 p.m. until January 10, 2021 during the COVID-19 pandemic. b. The Hookah Hideout violated Section 906(d)(5) of the Federal Food, Drug and Cosmetic Act (Act)(21 U.S.C. § 387F (d)(5)) and/or FDA/s tobacco regulations by selling tobacco to persons under the legal age and failure to verify age on August 16, 2021 and March 1, 2022. c. The Hookah Hideout failed 3 tobacco compliance checks conducted in 2022 by the Ramsey County Sheriff’s Department on June 27, 2022 (educational check), September 26, 2022 and December 7, 2022. Attachment 7-25-2023 Letter from Attorney representing The Hookah Hideout 8000 Flour Exchange Building - 310 Fourth Avenue South - Minneapolis, MN 55415 Phone: 612.455.0500 - Fax: 612.455.0501 - www.trepanierlaw.com July 25, 2023 Via E-Mail Kelly & Lemmons, P.A. Attn: Chad D. Lemmons 2350 Wycliff Street – Suite 200 Saint Paul, MN 55114 Re: The Hookah Hideout LLC – Little Canada Tobacco License Our File No. 4102-001 Dear Mr. Lemmons: As you know, this law firm represents The Hookah Hideout LLC at 3 Little Canada Rd. E., Little Canada, MN 55117 (the “Licensee”) and its owner, David Nelson. I have reviewed the July 12, 2023, Little Canada city council meeting, as well as Heidi Heller’s staff report for Licensee’s tobacco store license renewal dated the same day. On behalf of the Licensee, and its owner David Nelson, I want to emphasize my client’s acknowledgement and understanding of the concerns raised at the meeting by other local business owners, city staff, city council members, and you as city attorney. Although Mr. Nelson spoke about his business and answered many questions at the meeting, he has asked me to emphasize the following points: 1. Licensee has been in business in the city for over 10 years, and during that time, has been a solid corporate neighbor, notwithstanding operating a type of business – retail tobacco sales – with various challenges. 2. Many of Licensee’s customers regularly patronize other local businesses. 3. Recent complaints regarding Licensee are a change from historic practices at the mall and Licensee’s store. 4. Mr. Nelson is committed to keeping his business safe, clean, and orderly. Kelly & Lemmons, P.A. Attn: Chad D. Lemmons July 25, 2023 Page 2 In order to address concerns raised at the meeting, Licensee has begun to take the following steps, and would agree that these steps become conditions of Licensee’s license renewal: a. Licensee is currently working with the building’s management to reach agreement on hiring security, and on its own, to ensure there is sufficient staff working in the evening to ensure Licensee’s customers are respecting community norms (i.e., not remaining in the parking lot after business hours; not littering; not using the parking lot as a latrine). b. Licensee has reached an agreement with the building’s management to add new cameras and extra lights around the mall building. c. Licensee has modified its hours of operations to close at 11 p.m., and will ensure no customers remain on the premises after that time. d. Licensee will limit the number of people within its premises. Additionally, Licensee intends to extend his presence on the premises during certain business hours such that he can better manage the implementation of the above conditions. In sum, Licensee is ready, willing, and able to work in concert with the city to adopt these and other reasonable conditions to its continued operation. If I can provide additional reassurance to the city council, please contact me. Very truly yours, TREPANIER MACGILLIS BATTINA P.A. James C. MacGillis James C. MacGillis Direct: 612.455.0503 jmacgillis@trepanierlaw.com cc: Client (via e-mail) STAFF REPORT TO: Mayor Fischer and Members of City Council FROM: Heidi Heller, City Clerk/HR Manager DATE: July 26, 2023 RE: Ordinance 875, Amending City Code Chapter 802, Tobacco ACTION TO BE CONSIDERED: Consider adoption of Ordinance 875, Amending City Code Chapter 802, Tobacco, to add allowed hours of operation for tobacco stores. BACKGROUND: At the July 12, 2023 City Council meeting, the Council heard concerns from business owners about the late hours that The Hookah Hideout stays open, and Council requested that one of the conditions of their tobacco store license be restricted hours of operation. The City Code currently has no restrictions on hours of operation for either type of tobacco license (tobacco store or general sales & display). Staff recommended adding this as a condition of their license if it were approved, but also adding this restriction to the Tobacco Chapter of the City Code so it would be applicable to both tobacco stores in the city. Staff has prepared an Ordinance that amends City Code Chapter 802, Tobacco, to add allowed hours of operation for tobacco stores. Staff has suggested hours of operation from 8:00 a.m. to 11:00 p.m., but Council can make the final determination on the times. These hours of operation are recommended only for Tobacco Store licenses, not the General Sales & Display Tobacco Licenses that gas stations and liquor stores have. If Ordinance 875 is adopted on July 26, the ordinance would be published on July 30, 2023 and the new hours of operation requirement would go into effect that day. STAFF RECOMMENDATION: Staff recommends Council discuss and consider adopting Ordinance 875, Amending Chapter 802, Tobacco, to add allowed hours of operation for tobacco stores. CITY OF LITTLE CANADA RAMSEY COUNTY STATE OF MINNESOTA ORDINANCE NO. 875 AN ORDINANCE AMENDING LITTLE CANADA CITY CODE CHAPTER 802, TOBACCO The City Council of the City of Little Canada, Ramsey County, Minnesota does hereby ordain: SECTION 1. The City Council of the City of Little Canada hereby amends Chapter 802 of the Little Canada Municipal Code by deleting and adding the following language: CHAPTER 802 TOBACCO 802.070. LICENSE RESTRICTIONS. A license shall be issued subject to the following restrictions: (a) The following restrictions apply to retail establishments licensed as Tobacco Stores: (7) Tobacco Store hours of operation shall be between 8:00 a.m. and 11:00 p.m., 7 days per week. SECTION 2. REPEAL OF CONFLICTING ORDINANCES. That all ordinances or parts of ordinances in conflict herewith are hereby appealed. SECTION 3. SEVERABILITY CLAUSE. In any section, sentence, clause or phrase of this ordinance or any part thereof is for any reason found to invalid by a court of competent jurisdiction, such decision shall not affect the validity of the remainder of this ordinance or any part thereof. SECTION 4. This ordinance shall take effect and be in full force from and after its adoption and publication. Adopted this 26th day of July, 2023 By: ________________________________ Thomas Fischer, Mayor Attest: _________________________________ Christopher Heineman, City Administrator AYES: NAYS: Published July 30, 2023 STAFF REPORT TO: Mayor Fischer and Members of City Council FROM: Chris Heineman, City Administrator Bryce Shearen, Parks & Recreation Director DATE: July 26, 2023 RE: 2023 Deer Control Program ACTION TO BE CONSIDERED: The City Council is asked to consider a motion to authorize the Metro Bowhunters Resource Base (MBRB) to conduct a special deer hunt in Little Canada in 2023. BACKGROUND: Over the past twenty years, the City Council Little Canada has maintained a deer management program involving education and periodic removal of deer. The previously stated goals of the program are: •To prevent starvation and disease from overpopulation of deer •To reduce the number of motor vehicle accidents involving deer •To preserve and protect the land of property owners •To maintain a population at a “socially acceptable” level Aerial survey data collected by Ramsey County Parks & Recreation indicated that the northeast part of the City (including a portion of Maplewood) showed dramatic growth in the deer population from 2003 to 2010. Control efforts were started in 2010 and results have indicated that the deer population has been at more sustainable levels since that time. City staff also reviewed best practices and consulted with other professionals regarding population control options. The results are as follows: 1)Fertility Control Drugs - Estimated cost is $250 to $500 per deer and is very labor intensive and must be administered to high percentage of female segment to produce any results. Future doses of fertility control drugs are typically necessary to produce long-term results. Research has not shown this to be a viable solution to address urban deer population issues. 2)Sharpshooters - This option is also expensive with costs in the range of $250 to $350 per deer. While this technique has proved effective in other Ramsey County areas, it was felt other options should be pursued first. 3)Urban Bowhunting Through Metro Bowhunters Resource Base (MBRB) - Most cost efficient and safe method for reducing urban deer populations. Bowhunters can apply and are required to pass education and proficiency tests before approved to hunt. The City of Little Canada, in conjunction with MBRB, can decide on hunting details to best fit specific situations. Hunting takes place during the State of Minnesota archery season. 4)Allow private hunting through a permitting process utilizing the MN DNR archery season. Given the lack of large, privately owned sites and the concerns about controlling hunter activity, this option has been employed on a very limited basis for large parcels (>25 acres). Annual Deer Count Year Deer Count 2000 18 2001 35 2003 14 2004 20 2006 54 2007 52 2008 51 2009 71 2010 81 2011 69 2012 No Survey Conducted 2013 36 2014 24 2015 No Survey Conducted 2016 21 2017 No Survey Conducted 2018 19 2019 38 2020 43 2021 31 2022 No Survey Conducted 2023 32 Additional Notes: •In 2010, a private hunt permit was granted for the Sculley property at 3000 Labore Road. •In 2011, a private hunt permit was granted for Frattalone property at 3204 & 3205 Rice Street •In 2012, no count was taken due to the lack of snow cover. •In 2014, the aerial deer count of 24 was down from 109 counted in the same areas in 2011. •In 2015, the survey did not occur due to lack of snow cover. •In 2017, a count was not taken due to a lack of snow cover. •In 2022, no aerial survey was conducted by the DNR. Control Results In the fall of 2009, the City contracted with Metro Bowhunters Resource Base (MBRB), a non-profit organization of bowhunters to conduct a controlled hunt in the area of St. John’s Cemetery and other adjoining lands. 13 deer were removed from that area over three, two-day hunt periods that were spaced three weeks apart. The first hunt resulted in 10 deer being taken. The second yielded three deer and no deer were taken during the last hunt. •In 2010, the hunt areas were expanded and 52 deer were taken in the designated control areas. Even with 52 deer taken and 42 taken from the NE area of the City, the population only dropped from 81 to 69 in that area. Furthermore, the St. John’s Cemetery Area had been hunted for two years and still had a population of 13 deer. That number was down only one deer from 2010. This indicates the need for a continued program if numbers are to be reduced and maintained at acceptable levels. •In 2011, 33 deer were taken from the designated deer hunt areas. We also added additional hunt areas consisting of Gervais Mill, LC Elementary (south portion) & Spooner Park, and the Frattalone Property). These areas had additional restrictions and were late season additions. No deer were taken from these areas in 2011. •In 2012, hunt areas remained the same. Twenty (20) deer were taken in Little Canada and an additional 7 were taken in the Spoon Lake area added by the City of Maplewood. •In 2013, 12 deer were taken from approved hunt areas. An additional eight (8) deer were taken in Maplewood in the Spoon Lake Area and Fisher’s Corner. •In 2014, a total of only six (6) deer were taken in Little Canada. An additional seven (7) deer were taken in nearby locations in Maplewood. •In 2015, the only permit issued was for the Frattalone Property. No hunting on other sites in Little Canada was permitted. •In 2016, no hunting was permitted within the City of Little Canada •In 2017, a limited special hunt was permitted on the Scully property and the MBRB site. A total of nine (9) deer were taken in 2017. •In 2018, no hunting was permitted within the City of Little Canada •In 2019, no hunting was permitted within the City of Little Canada •In 2020, no hunting was permitted within the City of Little Canada •In 2021, no hunting was permitted within the City of Little Canada •In 2022, a special hunt was authorized in partnership with the City of Maplewood for an area just east of Lake Gervais surrounding Spoon Lake. A total of nine (9) deer were taken in 2022. The City’s intent with this initiative has not been to eradicate deer from the community. Deer are considered a valuable element of Little Canada’s ecosystem. Prior to the implementation of the Deer Management Program in 2010, the number of citizen complaints about deer was increasing. Residents were typically concerned that the local deer population increases the risk of car/deer accidents or that deer are causing damage to plants and landscaping throughout the community and a significant amount of staff time was dedicated to dealing with complaints and removing deer that had been struck by vehicles. Deer Management Goal & Objectives •Maintain deer populations at healthy and socially acceptable level •Manage the overall deer population of approximately 10 deer per square mile (40 deer) •Manage concentrated deer populations so as not to exceed 20 deer per square mile •Manage deer populations to reduce the number of car/deer collisions •Pass an ordinance prohibiting the feeding of deer and other wild animals/fowl •Educate residents on how to minimize nuisance problems through planting and landscaping; and the ramifications of supplemental deer feeding Management Policies 1)The City will continue to contract with Ramsey County Parks & Recreation for annual aerial deer survey services. The annual survey, resident input, and the availability of suitable hunt sites shall be used as a basis for determining the extent and location of any deer removal efforts for the upcoming season. 2)Attempt to document all resident input, including phone calls, e-mails and letters. These shall be collected by the City Administrator and be provided to the City Council for its annual evaluation of the deer management program. 3)Deer removal efforts necessary to achieve City objectives shall be limited to archery and shall be conducted by the Metro Bowhunters Resource Base (MBRB) or by private property owners when they have a site at least 20 acres in size and the hunters pass appropriate proficiency criteria and abide by City hunt rules. 4)Deer removal operations shall be conducted on public property where practical, and on private property where conditions are conducive to archery and of sufficient size and development is limited. Combinations of parcels to yield a site of sufficient size (ideally no less than 20 acres) and with limited development are acceptable; subject to property owner consent. 5)Notice will be mailed prior to the first removal date to all property owners whose land adjoins a proposed deer removal site. The notice shall include the dates of all hunts for that season and contact information for deer management personnel (city staff and law enforcement). 6)The City will provide deer management and control information to residents through the City’s newsletter and website. The MBRB has proposed a special deer hunt in Little Canada in partnership with the Spoon Lake area. Proposed dates for the special hunt are October 20-22 and December 1-3, 2023. RECOMMENDED ACTION: Staff recommends City Council authorization for a s pec ial controlled deer hunt in partnership with the Spoon Lake area of Maplewood on October 20-22 and December 1-3, 2023. 75 2.3 © Bolton & Menk, Inc - Web GIS 0 Legend Deer Culling Site This drawing is neither a legally recorded map nor a survey and is not intended to be used as one. This drawing is a compilation of records, information, and data located in various city, county, and state offices, and other sources affecting the area shown, and is to be used for reference purposes only. The City of Little Canada is not responsible for any inaccuracies herein contained. Disclaimer: 7/8/2022 1:52 PM 527 Feet Street Names - Large City Limits Parcels - Jan 2022 PWI Basin Lake Wetland PWI Watercourse STAFF REPORT TO: Mayor Keis and Members of the City Council FROM: Sam Magureanu, Finance Director DATE: July 26, 2023 RE: 2023 2nd Quarter Financial Reports INTRODUCTION: Attached are the 2023 2nd Quarter Financial Reports for the City of Little Canada. Attachments: General Fund Quarterly Financial Report Special Revenue and Enterprise Funds Quarterly Financial Report Investments by Maturity and Type General Fund Revenue Although first half property tax collections were not received at the City until July, these collections were included in the General Fund Quarterly Financial Report to reflect a more realistic budget to actual amount. 52.24% of the budget revenue has been collected in 2023. This is comparable with prior years. 50.38%43.49%44.50%50.00%52.24% 0.00% 10.00% 20.00% 30.00% 40.00% 50.00% 60.00% 70.00% 80.00% 90.00% 100.00% 110.00% 120.00% 130.00% 2019 2020 2021 2022 2023 % of Revenue to Budget Highlights: Weather can play a significant role especially when considering permits for roofing and siding. Number of building permits issued in Q2 for the current year higher than in prior year, 80 permits in current year versus 42 prior year in the month of June, majority roof permits. This increase in permits is due last year’s fall weather that caused a lot of damage to roofs. Some of the roof and siding work repair is being done this year. Building Permit Valuation significantly higher than last year. The increase relates to one large permit pulled for the Twin Lakes apartments building project. 154 110 138 133 236 0 50 100 150 200 250 2019 2020 2021 2022 2023 Building Permits Issued ‐Q1 16,891,005 3,324,829 2,528,655 13,485,778 22,505,021 ‐ 5,000,000 10,000,000 15,000,000 20,000,000 25,000,000 2019 2020 2021 2022 2023 Building Permit Valuation ‐Q2 The Old Fire Hall rentals and park shelter rentals are in the charges for services category. These rentals are trending higher in 2nd quarter 2023 at 60.33% of total budgeted revenues when compared with 2nd quarter of 2022 at 47.98% of total budgeted revenues. The increase relates to additional income generated from the facility rental to Ramsey County, estimated at approximately 14K for 2023. Miscellaneous Revenues includes Sheriff's credit and Falcon Heights Inspection reimbursements. 2023 amount includes 97K passthrough revenue to developer paid in July. When taking into consideration the 97K passthrough revenues only 23.39% of the budgeted revenues have been collected to date when compared to 51.01% in 2022. The decrease is due to Sheriff's credit revenues 60% less in Q2 of 2023, there might be additional revenues remitted to City in Q3 or Q4. General Fund Expenditures As of June 30, actual expenditures are at 48.01% of the budget and are comparable with prior years. 48.06%46.21%46.46%47.47%48.01% 0.00% 20.00% 40.00% 60.00% 80.00% 100.00% 120.00% 2019 2020 2021 2022 2023 % of Expenditures to Budget Highlights: The Elections department includes the first and second quarter elections services contract payments, and annual election maintenance payment to Ramsey County. Administration at 34.47% of budget when compared to prior year at 46.11%. The decreased relates with unspent funds that were budgeted for contracted services (100K) for exploring police alternatives. The Fire department is at 66.51% of the budget since contracted services includes Q1 to Q3 payments. This is consistent with the practice in prior years. Streets trends low at 40.48% as budgets for Ramsey County Striping and Sealcoating have not yet been paid (The work was done in May) It is anticipated that invoicing will be received and paid in Q3. The Northeast Youth & Family Services contract is paid once per year, so Community Partnerships is at 77.99% of the budget. This is consistent with prior years. Shade Trees department - 2023 Budget includes Ash tree removal and boulevard tree trimming. The entire budget of $20,000 has been spent already, to date at $27.736.44. A budget amendment will be necessary in current year in order to meet additional departmental needs. Special Revenue and Enterprise Funds The Quarterly Financial Report for the special revenue and enterprise funds is attached to this report. All funds fell within the expected budget amounts. Other Items Expenditures in the Insurance Fund at 72.65% of budget. General Liability and Workers Compensation Insurance is paid in full in the first quarter, however revenue allocations from the General Fund and Enterprise Funds are done quarterly (Revenues at 50.17% - reflects Q1 and Q2 of revenue allocations). This practice is consistent with prior years. Investments As of June 30, 2023, total cash and investments for all City Funds totaled $19,042,289.29, and the allocation by investment type is as follows: Type Amount Percentage MM $1,743,141.70 9.15% CD $10,473,597.88 55.00% Agency $2,049,223.70 10.76% Treasury $1,045,272.32 5.49% Municipal $243,298.80 1.28% Checking 4M $3,487,754.89 18.32% Total $19,042,289.29 100.00% All of the CD’s that City holds are under $250,000 and are FDIC insured. All current investments are within the City’s Investment Policy. Since the City’s cash and investments are needed for cash flow in the City’s operating and capital activities, it is helpful to understand the maturities in order to structure future investment opportunities. Below are the future maturities for the City’s cash and investments. Total 2023 2024 2025 2026 2027 2028 2029 January 1- 418,348.19 445,000.00 - - - - 863,348.19 February 2- - 245,000.00 249,000.00 - - - 494,000.00 March 3- 370,560.80 733,815.00 607,915.60 - - - 1,712,291.40 April 4- 200,454.22 350,000.00 245,000.00 450,000.00 - - 1,245,454.22 May 5- 245,000.00 - 245,000.00 - - - 490,000.00 June 6- 545,082.67 - - - - - 545,082.67 July 7 490,000.00 586,000.00 745,000.00 490,000.00 - - - 2,311,000.00 August 8 1,140,000.00 735,000.00 490,000.00 245,000.00 - - - 2,610,000.00 September 9 500,000.00 249,376.70 198,030.19 - - - - 947,406.89 October 10 736,889.61 383,919.72 - - - - - 1,120,809.33 November 11 245,000.00 - 245,000.00 - - - - 490,000.00 December 12 245,000.00 492,000.00 - 245,000.00 - - - 982,000.00 3,356,889.61 4,225,742.30 3,451,845.19 2,326,915.60 450,000.00 - - 13,811,392.70 15,554,534.40 1,743,141.70 MM Investments Maturity by Year and Month 3,356,889.61 4,225,742.30 3,451,845.19 2,326,915.60 450,000.00 2023 2024 2025 2026 2027 Maturities by Year The City budgets investment income as part of the budget process so it is helpful to understand the coupons (interest rate) for the cash and investments. Coupon Amount Percentage To 1.00% 6,957,723.39 44.73% 1.01% to 1.50% 245,000.00 1.58% 1.51% to 2.00% 980,298.80 6.30% 2.01% to 2.50% 150,000.00 0.96% 2.51% to 3.50% 2,323,081.18 14.94% 3.51 to 5.00% 4,898,431.03 31.49% Total 15,554,534.40 100.00% As of June 30, 2023 The City purchased ten new securities since the beginning of the year at an average yield of 4.593%. I am happy to answer any questions regarding the City’s finances and this report. CITY OF LITTLE CANADA GENERAL FUND QUARTERLY FINANCIAL REPORT THROUGH JUNE 30, 2023 WITH COMPARISON TO JUNE 30, 2022 General Fund Budget YTD Available Budget % of Budget Budget YTD Available Budget % of Budget Highlights/Comments Revenues: Taxes 3,786,436.00$ 1,997,215.65$ 1,789,220.35$ 52.75%3,392,230.00$ 1,763,861.55$ 1,628,368.45$ 52.00%Tax revenues are paid in 3 instalments (July, October/November and a final settlement in January of the following year) Licenses 54,880.00$ 9,770.00$ 45,110.00$ 17.80%63,225.00$ 16,336.00$ 46,889.00$ 25.84%Comparable with PY, historically collected in Q2 and Q3 (Hauler, Massage, Tattoo) Liquor Licenses 47,162.00$ 45,753.00$ 1,409.00$ 97.01%47,730.00$ 45,788.00$ 1,942.00$ 95.93%Comparable with PY, historically collected in Q2 and Q3 Permits 304,360.00$ 243,118.58$ 61,241.42$ 79.88%212,200.00$ 162,889.70$ 49,310.30$ 76.76%Comparable with PY, one large permit current year pulled for Twin Lakes ‐ Eagle Building 51K Charges for Services 28,639.00$ 17,277.96$ 11,361.04$ 60.33%24,090.00$ 11,558.02$ 12,531.98$ 47.98%Increase in rentals from Ramsey County for the Old Fire Station in 2023 Fines 40,000.00$ 13,923.58$ 26,076.42$ 34.81%44,000.00$ 17,734.19$ 26,265.81$ 40.30%County traffic fines share to the City ‐ This revenue source can fluctuate based on tickets Intergovernmental Revenue 275,478.00$ 68,794.50$ 206,683.50$ 24.97%287,518.00$ 72,786.50$ 214,731.50$ 25.32%First Distribution of MSA funds, comparable with PY Investment Income 23,800.00$ ‐$ 23,800.00$ 0.00%36,100.00$ 6,336.48$ 29,763.52$ 17.55%Will be allocated at year end Miscellaneous 185,265.00$ 43,324.40$ 141,940.60$ 23.39%187,297.00$ 95,545.04$ 91,751.96$ 51.01%Sheriff's credit and Falcon Heights Inspection. 2023 includes 97K passthrough revenue to developer not yet paid. Further Sheriff's credit 60% less in CY, there might be additional revenues rmitted to City Q3 and Q4. Transfers In 109,134.00$ ‐$ 109,134.00$ 0.00%106,400.00$ ‐$ 106,400.00$ 0.00%Transfers done at year end Total Revenues 4,855,154.00$ 2,439,177.67$ 2,415,976.33$ 50.24%4,400,790.00$ 2,192,835.48$ 2,207,954.52$ 49.83% Expenditures Mayor & Council 99,589.00$ 51,199.88$ 48,389.12$ 51.41%93,900.00$ 43,176.72$ 50,723.28$ 45.98% Elections 33,000.00$ 17,440.00$ 15,560.00$ 52.85%33,000.00$ 19,056.12$ 13,943.88$ 57.75%Election Services to Ramsey County ‐ Comparable with PY Administration 393,558.00$ 135,654.21$ 257,903.79$ 34.47%230,600.00$ 106,330.84$ 124,269.16$ 46.11%Contracted services in 2023 at 12% from budget. 2023 includes 100K of funds that were budgeted for exploring police alternatives. No funds were spent to date. Attorney 95,500.00$ 33,965.30$ 61,534.70$ 35.57%95,500.00$ 31,789.75$ 63,710.25$ 33.29%Prosecution retainer and civil retainer ‐ Comparable with PY Engineer 31,100.00$ 13,533.97$ 17,566.03$ 43.52%28,000.00$ 10,376.64$ 17,623.36$ 37.06%Engineering cost can differ to timing of projects and volume Planning 190,108.00$ 85,172.90$ 104,935.10$ 44.80%172,120.00$ 68,962.22$ 103,157.78$ 40.07% Insurance 45,390.00$ 22,695.00$ 22,695.00$ 50.00%38,790.00$ 19,395.00$ 19,395.00$ 50.00%General Liability and Worker's Comp City Center 38,800.00$ 16,598.55$ 22,201.45$ 42.78%31,700.00$ 14,378.24$ 17,321.76$ 45.36% Old Fire Hall 10,600.00$ 7,851.35$ 2,748.65$ 74.07%8,400.00$ 4,327.48$ 4,072.52$ 51.52%Replaced Boiler Backflow Preventer in 2023 Police 1,894,299.00$ 927,890.79$ 966,408.21$ 48.98%1,801,685.00$ 881,779.54$ 919,905.46$ 48.94%Ramsey County Sheriff's ‐ Trending within Expectation Fire Department 523,840.00$ 348,389.50$ 175,450.50$ 66.51%479,185.00$ 316,094.74$ 163,090.26$ 65.97%Q1 and Q2 paid ‐ Trending within Expectation Fire Marshal 15,950.00$ 8,334.43$ 7,615.57$ 52.25%15,200.00$ 4,609.49$ 10,590.51$ 30.33%Increased fire Inspector hours in 2023 Protective Inspections 282,166.00$ 124,887.17$ 157,278.83$ 44.26%235,030.00$ 113,506.45$ 121,523.55$ 48.29% Emergency Service/Civil Defense 3,895.00$ 931.65$ 2,963.35$ 23.92%2,910.00$ 224.24$ 2,685.76$ 7.71%Annual fire Extinguisher test not in PY ‐ Allocation change Animal Control 3,370.00$ 214.00$ 3,156.00$ 6.35%3,370.00$ 245.00$ 3,125.00$ 7.27% Streets 376,458.00$ 152,408.85$ 224,049.15$ 40.48%341,680.00$ 141,136.78$ 200,543.22$ 41.31%Comparable with prior year. More vehicle repairs and less operating supply in 2023. In 2022 purchased plow blades and Tool Cat Fleil Mower Storm Water 19,990.00$ 1,394.23$ 18,595.77$ 6.97%16,490.00$ 6,805.54$ 9,684.46$ 41.27%2022 Ditch Cleanning on Morrison Street Lighting 71,630.00$ 35,833.01$ 35,796.99$ 50.03%65,300.00$ 29,057.16$ 36,242.84$ 44.50%Electricity cost higher in 2023 Recycling/Sanitation 32,140.00$ 14,722.53$ 17,417.47$ 45.81%31,640.00$ 9,425.00$ 22,215.00$ 29.79%Higher cost in 2023 for Newsletter printing City Garage 49,669.00$ 27,665.20$ 22,003.80$ 55.70%37,445.00$ 24,465.24$ 12,979.76$ 65.34% Parks & Recreation 579,338.00$ 253,121.81$ 326,216.19$ 43.69%530,270.00$ 219,491.01$ 310,778.99$ 41.39%Compareble to PY and Budget Community Partnerships 29,764.00$ 23,213.75$ 6,550.25$ 77.99%30,095.00$ 22,308.66$ 7,786.34$ 74.13% Shade Trees 20,000.00$ 27,736.44$ (7,736.44)$ 138.68%10,000.00$ 1,800.00$ 8,200.00$ 18.00%More than anticipated EAB trees in 2023 than budgeted Transfers Out ‐$ ‐$ #DIV/0!‐$ ‐$ #DIV/0! Contingency 15,000.00$ ‐$ 15,000.00$ 0.00%68,480.00$ ‐$ 68,480.00$ 0.00% Total Expenditures 4,855,154.00$ 2,330,854.52$ 2,524,299.48$ 48.01%4,400,790.00$ 2,088,741.86$ 2,312,048.14$ 47.46% 2023 2022 FUNDBudget Actual % of Budget Budget Actual % of BudgetParks & Recreation (201)Revenues 56,160$ 30,336$ (1) 54.02% 49,380$ 22,238$ 45.04%Expenditures 63,297 26,750 42.26% 53,990 20,396 37.78%Net Change (7,137)$ 3,585$ (4,610)$ 1,842$ (1)More adult classes and field rental from Catholic Softball group, and SAP Race in 2023Cable TV (202)Revenues 112,609$ 26,338$ (1) 23.39% 114,080$ 27,948$ (1) 24.50%Expenditures 116,324 31,212 (2) 26.83% 125,070 30,629 (2) 24.49%Net Change (3,715)$ (4,874)$ (10,990)$ (2,681)$ (1)In line with budget and expectations(2) In line with budget and expectations. Budget includes operating transfer that will be booked at yer end.Recycling & Disposal (203)Revenues 544,044$ 268,631$ (1) 49.38% 505,560$ 244,306$ (1) 48.32%Expenditures 572,400 257,014 (2) 44.90% 523,700 230,358 (2) 43.99%Net Change (28,356)$ 11,616$ (18,140)$ 13,948$ (1)In line with budget and expectations(2) In line with budget and expectations. Water Operating (601)Revenues 2,069,680$ 1,009,569$ (1) 48.78% 1,752,680$ 909,045$ (1) 51.87%Expenditures 2,177,029 890,169 (2) 40.89% 1,805,130 801,764 (2) 44.42%Net Income before other items (107,349) 119,400 ‐111.23%(52,450) 107,281 ‐204.54%Depreciation‐ ‐ ‐ ‐ Net Income/(loss) (107,349)$ 119,400$ (52,450)$ 107,281$ (1) In line with budget and expectations(2)In line with budget and expectationsSewer Operating (602)Revenues 1,725,204$ 918,180$ (1) 53.22% 1,551,580$ 884,885$ (1) 57.03%Expenditures 1,849,436 1,023,766 (2) 55.36% 1,590,125 892,090 (2) 56.10%Net Income before other items (124,232) (105,586) 84.99% (38,545) (7,205) 18.69%Depreciation‐ ‐ Net Income/(loss) (124,232)$ (105,586)$ (38,545)$ (7,205)$ (1) In line with budget and expectations(2)In line with budget and expectationsInsurance (700)User Charges 319,210$ 160,136$ 50.17% 293,015$ 146,228$ 49.90%Expenditures 323,710 235,172 (2) 72.65% 297,550 203,164 (2) 68.28%Net Change (4,500)$ (75,037)$ 1667.48%(4,535)$ (56,936)$ 1255.48%2023 2022CITY OF LITTLE CANADASPECIAL REVENUE AND ENTERPRISE FUNDS QUARTERLY FINANCIAL REPORTTHROUGH JUNE 30, 2023 WITH COMPARISON TO JUNE 30, 2022 Broker Type Interest Rate Purchase Date Maturty Date Carrying Value 4M CD 3.25% 9/16/2022 $45,459.00 $245,235.67 4M CD 3.35% 9/22/2022 $45,373.00 $245,177.60 4M Treasury 4.06% 1/19/2023 10/31/2024 $383,919.72 4M CD 4.41% 1/27/2023 4/29/2024 $200,454.22 4M CD 4.56% 1/13/2023 1/13/2025 $200,000.00 4M CD 4.80% 1/30/2023 1/30/2024 $200,286.80 4M Checking $3,487,754.89 Moreton CD 0.20% 2/10/2021 8/10/2023 $245,000.00 Moreton CD 0.25% 8/20/2021 8/18/2023 $245,000.00 Moreton CD 0.25% 2/19/2021 8/19/2024 $245,000.00 Moreton Agency 0.27% 11/25/2020 8/23/2023 $500,000.00 Moreton CD 0.30% 7/16/2021 7/17/2023 $245,000.00 Moreton CD 0.30% 8/17/2021 8/19/2024 $245,000.00 Moreton CD 0.30% 3/25/2021 3/5/2025 $241,815.00 Moreton CD 0.45% 8/13/2021 8/13/2025 $245,000.00 Moreton Agency 0.70% 12/2/2021 6/24/2024 $299,847.00 Moreton CD 0.85% 12/15/2021 12/16/2024 $247,000.00 Moreton CD 0.95% 7/22/2021 7/22/2026 $245,000.00 Moreton CD 1.75% 2/14/2020 8/14/2024 $245,000.00 Moreton Municipal 2.00% 3/31/2021 3/1/2024 $125,383.20 Moreton Municipal 2.00% 2/17/2021 3/1/2026 $117,915.60 Moreton CD 4.20% 2/24/2023 2/24/2026 $249,000.00 Moreton CD 4.90% 4/19/2023 4/19/2027 $225,000.00 Moreton CD 4.90% 4/28/2023 4/28/2027 $225,000.00 Moreton 5.01% $816,991.79 RCU CD 4.75% 6/1/2023 10/30/2023 $246,628.59 RCU $10.91 UBS CD 0.25% 7/29/2021 7/23/2023 $245,000.00 UBS CD 0.50% 2/12/2021 2/12/2025 $245,000.00 UBS CD 0.90% 11/17/2021 11/17/2025 $245,000.00 UBS CD 0.90% 3/25/2021 3/25/2026 $245,000.00 UBS CD 2.15% 8/16/2017 8/16/2023 $150,000.00 UBS CD 2.65% 4/21/2022 4/25/2025 $150,000.00 UBS Treasury 3.28% 8/26/2022 10/31/2023 $245,261.02 UBS Treasury 3.34% 8/26/2022 09/30/2025 $198,030.19 UBS Agency 3.38% 8/26/2022 9/13/2024 $249,376.70 UBS CD 3.40% 8/4/2022 8/4/2025 $245,000.00 UBS 4.96% $333,467.78 Wells Fargo Treasury 0.13% 1/15/2022 1/15/2024 $218,061.39 Wells Fargo CD 0.30% 12/11/2020 12/11/2023 $245,000.00 Wells Fargo CD 0.40% 6/30/2021 7/1/2024 $245,000.00 Wells Fargo CD 0.40% 4/8/2021 1/8/2025 $245,000.00 Wells Fargo CD 0.40% 9/20/2021 3/20/2025 $245,000.00 Wells Fargo CD 0.45% 7/21/2021 7/22/2024 $245,000.00 Wells Fargo CD 0.50% 11/5/2021 11/6/2023 $245,000.00 Wells Fargo CD 0.50% 7/28/2021 7/29/2024 $96,000.00 Wells Fargo CD 0.65% 4/29/2021 4/29/2025 $200,000.00 Wells Fargo Agency 0.81% 10/29/2021 7/29/2025 $500,000.00 Wells Fargo CD 1.00% 4/13/2021 4/13/2026 $245,000.00 Wells Fargo CD 1.00% 7/8/2021 7/8/2026 $245,000.00 Wells Fargo CD 1.35% 12/16/2021 12/16/2026 $245,000.00 Wells Fargo CD 1.80% 3/3/2022 3/3/2025 $247,000.00 Wells Fargo CD 1.85% 10/31/2019 10/31/2023 $245,000.00 Wells Fargo Agency 3.25% 8/24/2022 9/1/2023 $500,000.00 Wells Fargo CD 3.40% 6/30/2022 7/7/2025 $245,000.00 Wells Fargo CD 4.60% 5/31/2023 8/28/2026 $245,000.00 Wells Fargo CD 4.65% 5/19/2022 5/19/2026 $245,000.00 Wells Fargo CD 4.75% 11/30/2022 5/30/2024 $245,000.00 Wells Fargo CD 4.75% 3/9/2023 3/9/2026 $245,000.00 Wells Fargo CD 4.75% 12/5/2022 12/16/2024 $245,000.00 Wells Fargo 4.65% $592,671.22 $19,042,289.29 515 Little Canada Road, Little Canada, MN 55117-1600 (651) 766-4029 / FAX: (651) 766-4048 www.littlecanadamn.org MAYOR Tom Fischer COUNCIL Teresa Miller Amanda Gutierrez Dave Miller Chris Kwapick TO: Mayor Fischer and Members of City Council FROM: Chris Heineman, City Administrator Sam Magureanu, Finance Director DATE: July 26, 2023 RE: Amendment #3 to Wholesale Water Service Agreement with St. Paul Regional Water Services. ACTION TO BE CONSIDERED: The City Council is asked to consider a Motion to Approve Amendment #3 to the Wholesale Water Service Agreement with the Board of Commissioners for St. Paul Regional Water Services. BACKGROUND: Attached is the amendment #3 to our contract for Wholesale Water Services with the Board of Commissioners for the St. Paul Regional Water Services (SPRWS). This amendment is the result of the rate study conducted by BakerTilly that concluded March of 2023. The purpose of the study as noted in the Project Scope of the attached report was to” analyze the City of St. Paul’s/St. Paul Regional Water Service (SPRWS) Water Fund to determine the appropriate rate structures and other revenue sources needed for operations and the financing of capital improvements. The rate structure and other revenue in the Water Fund must provide sufficient revenue to cover anticipated operating and maintenance expenses, debt service including principal and interest, capital improvements and replacements, and to maintain adequate cash reserves. The total revenue collected should reflect not only recent cost experience but should recognize anticipated future costs during the period for which rates are being established”. A copy of the study is attached to this report for your review. The results of the rate study resulted in proposed increases to our current rates as follows: 2022 2023 2024 2025 2026 2027 2.03$ 2.22$ 2.38$ 2.54$ 2.67$ 2.80$ % Change 9.36% 7.21% 6.72% 5.12% 4.87% 2022 2023 2024 2025 2026 2027 14,100$ 15,400$ 16,500$ 17,600$ 18,500$ 19,400$ % Change 9.22% 7.14% 6.67% 5.11% 4.86% Volume Rate Increase Monthly Base Fee Increase The proposed increases were anticipated by City staff and were properly reflected in City’s current Water fund budget and long-range projected rates. RECOMMENDED ACTION: Based on the results of the rate study, staff recommends approval of Amendment #3 to the Contract for Water Service with the St. Paul Board of Water Commissioners as presented. Saint Paul Regional Water Services Cost of Services FINAL REPORT March 20, 2023 Contents This document contains confidential material that is proprietary to Baker Tilly US, LLP, and other related entities (collectively referred to herein as Baker Tilly). The materials, ideas, and concepts contained herein are to be used exclusively to evaluate the capabilities of Baker Tilly. The confidential information and ideas herein may not be disclosed to any outside parties and may not be used for purposes other than the evaluation of Baker Tilly’s capabilities. 1. PROJECT BACKGROUND, OBJECTIVES AND SCOPE ............................................... 1 2. COST OF SERVICES ...................................................................................................... 2 Page | 1 1. Project Background, Objectives and Scope Baker Tilly was hired to review and analyze the City of St. Paul’s/St. Paul Regional Water Service (SPRWS) Water Fund to determine the appropriate rate structures and other revenue sources needed for operations and the financing of capital improvements. The rate structure and other revenue in the Water Fund must provide sufficient revenue to cover anticipated operating and maintenance expenses, debt service including principal and interest, capital improvements and replacements, and to maintain adequate cash reserves. The total revenue collected should reflect not only recent cost experience but should recognize anticipated future costs during the period for which rates are being established. Our scope included a cost-of-services analysis for wholesale customers to determine the revenue requirements that should come from. The purpose of this report is to present the cost of services analysis. Page |2 2. Cost of Services SPRWS performed a base extra capacity analysis in 2017 and in 2019. The first study completed in November of 2017 was a “Cost of Services Study for Wholesale Customers Cities of Little Canada and Roseville”. The second was completed in November 2019 and was a Cost of Services Study for Wholesale Customers Cities of Little Canada and Roseville November 2017 and Incorporating Cost Of Service Study for University Of Minnesota November 2019”. • Baker Tilly performed a cost-of-service study as part of this water rate study. Our cost-of-service study followed the processes incorporated in the two previous studies to provide consistency. However, we carefully reviewed the two previous studies and the widely accepted methodology provided in the American Water Works Association (AWWA) “Principles of Water Rates, Fees, and Charges Manual M1”, to ensure we agreed with the methodology used. The cost-of-service study is based on a large amount of data related to utility assets, water consumption, methods of operation and other related data. The data provided for this analysis included: o Wholesale water consumption data for 2017 through 2021 o Asset report for 12/31/2020 o 2022 budget data Assumptions incorporated into the cost-of-service analysis from the previous two studies and from our own experience include: • Assets that serve each of the wholesale customers (the same as in the 2017 & 2019 study) • The 2022 cost per foot of distribution piping serving each wholesale customer was estimated based on the 2017 cost in the previous studies inflated to 2022 by the long-term average increase in the American and City Municipal Construction cost index • The 2022 cost of preparing and collecting a bill including meter reading was estimated by inflating the 2019 costs by the change in operating costs from 2019 to 2022 • The 2022 administration and engineering design base percentages were the same as in the 2019 study • The present worth of the assets was determined by inflating the current book value from the asset report by the long-term average increase in the American and City Municipal Construction cost index • Assets that were not readily identifiable to a particular functional classification were assumed to be in the same functional classification as in the 2019 study. New assets were assigned to the most logical classification based on the type. • A 5% return on investment as was used as in the 2017 and 2019 studies Page | 3 Cost of Services Return on Rate Base Return on rate base provides a rate of return on the capital investment required to provide water service to SPRWS’ customers. The underlying logic is that SPRWS should receive a return on its invested capital from nonowner customers because they do not share in financing SPRWS’ capital improvements except through the cost of depreciation. The revenue requirements associated with “a return on rate base” are calculated by multiplying the present worth of the asset (the original cost minus accumulated depreciation adjusted to its present worth) by an inflation factor to bring it to its present value. The 2017 and 2019 studies used the Handy Whitman Index to determine the present worth. Neither SPRWS nor Baker Tilly currently subscribe to this index so the long-term average increase in the American and City Municipal Construction cost index was used for the present worth calculations. A spot check of this index against the Handy Whitman Index found negligible differences. The estimated present worth of SPRWS’ assets by functional area were calculated from the asset database provided for this analysis. These present worth costs were then allocated to retail and wholesale customers based on consumption data. The average consumption data for the period 2017 through 2021 was used for this purpose. This data is shown below. The data showed a fairly large reduction for the U of M from the 2019 study average of 153.15 million gallons per year (MGY) to 117.51 MGY for this study. Water Demand (MGY) The average day, max day and max hour relative volumes were determined to be as shown in the table below for each customer. The allocation percentages for the base extra capacity method using the consumption data are shown in the table below. Base Base Extra Capacity Capacity Max Day Max Hour TotalTotal Capacity (MGD)33.79 62.02 186.06 Percent AllocationAvg Day and Max Day 54%46%0%100%Avg Day and Max Hour 18%0%82%100%Avg Day, Max Day and Max Hour 18%33%49%100% Extra Capacity Year Roseville (MGY) Little Canada (MGY) Wholesale U of M Retail (MGY) Total consumption Water (MGY) Total Treated Water (MGY) 2017 1,640.605604 353.181664 10,377.556024 12,371.343292 14,349.124731 2018 1,714.346436 339.788724 10,309.872496 12,364.007656 14,469.866214 2019 1,629.465640 337.297884 9,930.225844 11,896.989368 14,121.936735 2020 1,708.833676 355.041940 105.170296 9,782.851144 11,951.897056 14,005.936735 2021 1,878.726168 383.789076 129.864020 10,337.531292 12,729.910556 14,647.457608 Average 1,714.395505 353.819858 117.517158 10,147.607360 12,262.829586 14,236.716104 Customers MGY MGD % of Total MGDRetail Customers 10,147.61 27.80 82.28%51.03 82.28%153.09 82.28%Roseville 1,714.40 4.70 13.90%8.62 13.90%25.86 13.90%Little Canada 353.82 0.97 2.87%1.78 2.87%5.34 2.87%U of M 117.52 0.32 0.95%0.59 0.95%1.77 0.95% Total 12,333.34 33.79 100.00%62.02 100.00% 186.06 100.00% Average Day Max Day Max Hour Page | 4 Cost of Services The asset value present worth amounts, and depreciation amounts were distributed to the wholesale and retail customers using the base plus extra capacity factors derived from the consumption data with the exception of distribution, meters and billing assets which we distributed based on the assets each customer benefited from similar to the 2017 and 2019 studies. The total capital cost is determined by the sum of the plant value, the return on investment at 5% and the current depreciation. These allocations are shown in the table below and on the following pages. Allocation of Asset Present Worth Description Asset Value (Present Worth)%Amount %Amount %Amount Administration Total 15,585,780$ 100.00% 15,585,780$ -$ 0.00%-$ Business Total -$ 100.00%-$ -$ Engineering Total 61,121$ 100.00% 61,121$ -$ -$ Land Production Land 3,716,925$ 100.00% 3,716,925$ Other Land 344,841$ 100.00% 344,841$ Total 4,061,766$ 4,061,766$ -$ -$ Treatment (Production) Total 101,938,211$ 54.48% 55,538,364$ 45.52% 46,399,847$ 0.00%-$ Distribution Equipment etc. Building and Structures 500,537$ Equipment 2,740,763$ Infrastructure 348,116,749$ Improvements other than Buildings 7,059$ Total 351,365,108$ 18.16% 63,810,691$ 0.00%-$ 81.84% 287,554,417$ Tanks and Towers Infrastructure, Equipment, Machinery 12,704,086$ 18.16% 2,307,163$ 0.00%-$ 81.84% 10,396,923$ McCarrons Finished Water Reservoir 619,626$ 18.16% 112,529$ 0.00%-$ 81.84% 507,097$ Total 13,323,712$ 2,419,692$ -$ 10,904,020$ Roseville Building and Infrastructure (Dale Street Reservoir)7,498,090$ 18.16% 1,361,713$ 0.00%-$ 81.84% 6,136,378$ Equipment and Machinery (meters/meter vault)283,768$ 18.16% 51,535$ 0.00%-$ 81.84% 232,234$ Other Capital Outlay -$ 0.00% Total 7,781,859$ 1,413,247$ 0.00%-$ 6,368,611$ Little Canada Building and Infrastructure (Including meter house/meter)24,041$ 18.16% 4,366$ 81.84% 19,675$ Total 24,041$ 4,366$ -$ 19,675$ U of M Total 3,378,067$ 18.16% 613,484$ 0.00%-$ 81.84% 2,764,583$ -$ Meters and Billing Total 18,324,095$ 100.00% 18,324,095$ 0.00%-$ 0.00%-$ Total Plant Value 515,843,760$ 161,832,606$ 46,399,847$ 307,611,306$ Total Average Day Base Maximum Day Maximum Hour Extra Capacity Page | 5 Cost of Services Allocation of Asset Present Worth (continued) Description %Amount %A mount %Amount Administration Total 13.90% 2,166,501$ 0.00%-$ 0.00%-$ Business Total 13.90%-$ Engineering Total 13.90% 8,496$ 0.00%-$ 0.00%-$ Land Production Land 13.90% 516,671$ 0.00%-$ 0.00%-$ Other Land 0.00%-$ 0.00%-$ 0.00%-$ Total 516,671$ -$ -$ Treatment (Production) Total 13.90% 7,720,108$ 13.90% 6,449,809$ 0.00%-$ Distribution Equipment etc. Building and Structures Equipment Infrastructure Improvements other than Buildings Total 1.09% 698,100$ 0.00%-$ 1.09% 3,145,894$ Tanks and Towers Infrastructure, Equipment, Machinery 0.00%-$ 0.00%-$ 0.00%-$ McCarrons Finished Water Reservoir 13.90% 15,642$ 0.00%-$ 13.90% 70,489$ Total 15,642$ -$ 70,489$ Roseville Building and Infrastructure (Dale Street Reservoir)50.00% 680,856$ 0.00%-$ 50.00% 3,068,189$ Equipment and Machinery (meters/meter vault)100.00% 51,535$ 0.00%-$ 100.00% 232,234$ Other Capital Outlay 0.00%-$ 0.00%-$ 0.00%-$ Total 732,391$ -$ 0.00% 3,300,422$ Little Canada Building and Infrastructure (Including meter house/meter) Total U of M Total 0.00%-$ 0.00%-$ 0.00%-$ Meters and Billing Total 0.00%-$ 0.00%-$ 0.00%-$ Total Plant Value 11,857,909$ 6,449,809$ 1.09% 6,516,805$ Roseville Base Extra Capacity Average Day Maximum Day Maximum Hour Page | 6 Cost of Services Allocation of Asset Present Worth (continued) Description %Amount %A mount %Amount Administration Total 2.87% 447,126$ 0.00%-$ 0.00%-$ Business Total Engineering Total 2.87% 1,753$ 0.00%-$ 0.00%-$ Land Production Land 2.87% 106,631$ 0.00%-$ 0.00%-$ Other Land 0.00%-$ 0.00%-$ 0.00%-$ Total 106,631$ -$ -$ Treatment (Production) Total 2.87% 1,593,289$ 2.87% 1,331,123$ 0.00%-$ Distribution Equipment etc. Building and Structures Equipment Infrastructure Improvements other than Buildings Total 0.45% 289,291$ 0.00%-$ 0.45% 1,303,654$ Tanks and Towers Infrastructure, Equipment, Machinery 0.00%-$ 0.00%-$ 0.00%-$ McCarrons Finished Water Reservoir 2.87% 3,228$ 0.00%-$ 2.87% 14,548$ Total 3,228$ -$ 14,548$ Roseville Building and Infrastructure (Dale Street Reservoir)0.00%-$ 0.00%-$ 0.00%-$ Equipment and Machinery (meters/meter vault)0.00%-$ 0.00%-$ 0.00% -$ Other Capital Outlay 0.00%-$ 0.00%-$ 0.00%-$ Total -$ -$ -$ Little Canada Building and Infrastructure (Including meter house/meter) Total 100.00% 4,366$ 100.00% 19,675$ U of M Total 0.00%-$ 0.00%-$ 0.00%-$ Meters and Billing Total 0.00%-$ 0.00%-$ 0.00%-$ Total Plant Value 109.06% 2,445,686$ 2.87% 1,331,123$ 100.45% 1,337,876$ Little Canada Base Extra Capacity Average Day Maximum Day Maximum Hour Page | 7 Cost of Services Allocation of Asset Present Worth (continued) Description %Amount %Amount %Amount Administration Total 0.95% 148,508$ 0.00%-$ 0.00%-$ Business Total Engineering Total 0.95%582$ 0.00%0.00% Land Production Land 0.95% 35,416$ 0.00%-$ 0.00%-$ Other Land 0.00%-$ 0.00%-$ 0.00%-$ Total 35,416$ -$ -$ Treatment (Production) Total 0.95% 529,192$ 0.95% 442,117$ 0.95%-$ Distribution Equipment etc. Building and Structures Equipment Infrastructure Improvements other than Buildings Total 0.79% 506,459$ 0.00%-$ 0.79% 2,282,289$ Tanks and Towers Infrastructure, Equipment, Machinery 0.00%-$ 0.00%-$ 0.00%-$ McCarrons Finished Water Reservoir 0.95% 1,072$ 0.00%-$ 0.95% 4,832$ Total 1,072$ -$ 4,832$ Roseville Building and Infrastructure (Dale Street Reservoir)0.00%-$ 0.00%-$ 0.00%-$ Equipment and Machinery (meters/meter vault)0.00%-$ 0.00%-$ 0.00%-$ Other Capital Outlay 0.00%-$ 0.00%-$ 0.00%-$ Total -$ -$ -$ Little Canada Building and Infrastructure (Including meter house/meter) Total U of M Total 25.00% 153,371$ 0.00%-$ 25.00% 691,146$ Meters and Billing Total 0.00%-$ 0.00%-$ 0.00%-$ Total Plant Value 28.65% 1,374,601$ 0.95% 442,117$ 26.75% 2,978,267$ University of Minnesota Base Extra Capacity Average Day Maximum Day Maximum Hour Page | 8 Cost of Services Allocation of Asset Present Worth (continued) Description %Amount %Amount %Amount Administration Total 82.28% 12,823,645$ 0.00%-$ 0.00%-$ Business Total Engineering Total 82.28% 50,289$ 0.00%-$ 0.00%-$ Land Production Land 82.28% 3,058,206$ 0.00%-$ 0.00%-$ Other Land 100.00% 344,841$ 0.00%-$ 0.00%-$ Total 3,403,047$ -$ Treatment (Production) Total 82.28% 45,695,774$ 82.28% 38,176,798$ 0.00%-$ Distribution Equipment etc. Building and Structures Equipment Infrastructure Improvements other than Buildings Total 97.66% 62,316,842$ 0.00%-$ 97.66% 280,822,580$ Tanks and Towers Infrastructure, Equipment, Machinery 100.00% 2,307,163$ 0.00%-$ 100.00% 10,396,923$ McCarrons Finished Water Reservoir 82.28% 92,586$ 0.00%-$ 82.28% 417,229$ Total 2,399,749$ -$ 10,814,152$ Roseville Building and Infrastructure (Dale Street Reservoir)50.00% 680,856$ 0.00%-$ 50.00% 3,068,189$ Equipment and Machinery (meters/meter vault) 0.00% -$ 0.00% -$ 0.00% -$ Other Capital Outlay 0.00%-$ 0.00%-$ 0.00%-$ Total 680,856$ -$ 3,068,189$ Little Canada Building and Infrastructure (Including meter house/meter) Total U of M Total 75.00% 460,113$ 0.00%-$ 75.00% 2,073,437$ Meters and Billing Total 100.00% 18,324,095$ 0.00%-$ 0.00%-$ Total Plant Value 519.49% 146,154,410$ 82.28% 38,176,798$ 296,778,358$ Retail Customers Base Extra Capacity Average Day Maximum Day Maximum Hour Page | 9 Cost of Services Allocation of Depreciation Description Depreciation %Amount %Amount %Amount Administration Total 236,967$ 100.00% 236,967$ 0.00%-$ 0.00%-$ Business Total Engineering Total 22,098$ 100.00% 22,098$ 0.00%-$ 0.00%-$ Land Total -$ Treatment (Production) Total 2,825,676$ 54.00% 1,525,865$ 46.00% 1,299,811$ 0.00%-$ Distribution Equipment etc. Building and Structures 10,556$ Equipment 527,959$ Infrastructure 5,334,849$ Improvements other than Buildings 584$ Total 5,873,948$ 18.16% 1,066,756$ 0.00%-$ 81.84% 4,807,193$ Tanks and Towers Other than McCarrons 319,744$ 18.16% 58,068$ 0.00%-$ 81.84% 261,676$ McCarrons Finished Water Reservoir 21,375$ 18.16% 3,882$ 0.00%-$ 81.84% 17,493$ McCarron's Low Service Tank -$ 18.16%-$ 0.00%-$ 81.84%-$ Total 341,119$ 61,950$ -$ 279,169$ Roseville Building and Infrastructure (Dale Street Reservoir)107,660$ 18.16% 19,552$ 0.00%-$ 81.84% 88,108$ Equipment and Machinery (meters/valves)7,166$ 18.16% 1,301$ 0.00%-$ 81.84% 5,865$ Total 114,826$ 20,853$ -$ 93,973$ Little Canada Building and Infrastructure (Including meter house/meter)379$ 18.16%69$ 0.00%-$ 81.84%310$ Total 379$ 69$ -$ 310$ U of M Total 46,115$ 18.16% 8,375$ 0.00%-$ 81.84% 37,740$ Meters and Billing Total 800,281$ 100.00% 800,281$ 0.00%-$ 0.00%-$ Total Plant Value 10,261,410$ 390.32% 3,743,214$ 46.00% 1,299,811$ 163.68% 5,218,385$ Average Day Maximum Day Maximum Hour Total Base Extra Capacity Page | 10 Cost of Services Allocation of Depreciation (continued) Description %Amount %Amount %Amount Administration Total 13.90% 32,940$ 0.00%-$ 0.00%-$ Business Total Engineering Total 13.90% 3,072$ 0.00%-$ 0.00%-$ Land Total Treatment (Production) Total 13.90% 212,103$ 13.90% 180,680$ 0.00%-$ Distribution Equipment etc. Building and Structures Equipment Infrastructure Improvements other than Buildings Total 1.09% 11,670$ 0.00%-$ 1.09% 52,592$ Tanks and Towers Other than McCarrons 0.00%-$ 0.00%-$ 0.00%-$ McCarrons Finished Water Reservoir 13.90%540$ 0.00%-$ 13.90% 2,432$ McCarron's Low Service Tank 0.00%-$ 0.00%-$ 0.00%-$ Total 540$ -$ 2,432$ Roseville Building and Infrastructure (Dale Street Reservoir)50.00% 9,776$ 0.00%-$ 50.00% 44,054$ Equipment and Machinery (meters/valves)100.00% 1,301$ 0.00%-$ 100.00% 5,865$ Total 11,077$ -$ 49,919$ Little Canada Building and Infrastructure (Including meter house/meter)0.00%-$ 0.00%-$ 0.00%-$ Total -$ -$ -$ U of M Total 0.00%-$ 0.00%-$ 0.00%-$ Meters and Billing Total 0.00%-$ 0.00%-$ 0.00%-$ Total Plant Value 42.80% 271,402$ 13.90% 180,680$ 1.09% 104,942$ Maximum HourAverage Day Maximum Day Roseville Base Extra Capacity Page | 11 Cost of Services Allocation of Depreciation (continued) Description %Amount %Amount %Amount Administration Total 2.87% 6,798$ 0.00%-$ 0.00%-$ Business Total Engineering Total 2.87%634$ 0.00%-$ 0.00%-$ Land Total Treatment (Production) Total 2.87% 43,774$ 2.87% 37,289$ 0.00%-$ Distribution Equipment etc. Building and Structures Equipment Infrastructure Improvements other than Buildings Total 0.45% 4,836$ 0.00%-$ 0.45% 21,794$ Tanks and Towers Other than McCarrons 0.00%-$ 0.00%-$ 0.00%-$ McCarrons Finished Water Reservoir 2.87%111$ 0.00%-$ 2.87%502$ McCarron's Low Service Tank 0.00%-$ 0.00%-$ 0.00%-$ Total 111$ -$ 502$ Roseville Building and Infrastructure (Dale Street Reservoir)0.00%-$ 0.00%-$ 0.00%-$ Equipment and Machinery (meters/valves)0.00%-$ 0.00%-$ 0.00%-$ Total -$ -$ -$ Little Canada Building and Infrastructure (Including meter house/meter)100.00%69$ 0.00%-$ 100.00%310$ Total 69$ -$ 310$ U of M Total 0.00%-$ 0.00%-$ 0.00%-$ Meters and Billing Total 0.00%-$ 0.00%-$ 0.00%-$ Total Plant Value 9.06% 56,223$ 2.87% 37,289$ 0.45% 22,606$ Average Day Maximum Day Maximum Hour Extra Capacity Little Canada Base Page | 12 Cost of Services Allocation of Depreciation (continued) Description %Amount %Amount %Amount Administration Total 0.95% 2,258$ 0.00%-$ 0.00%-$ Business Total Engineering Total 0.95%211$ 0.00%-$ 0.00%-$ Land Total Treatment (Production) Total 0.95% 14,539$ 0.95% 12,385$ 0.00%-$ Distribution Equipment etc. Building and Structures Equipment Infrastructure Improvements other than Buildings Total 0.79% 8,467$ 0.00%-$ 0.79% 38,154$ Tanks and Towers Other than McCarrons 0.00%-$ 0.00%-$ 0.00%-$ McCarrons Finished Water Reservoir 0.95%37$ 0.00%-$ 0.95%167$ McCarron's Low Service Tank 0.00%-$ 0.00%-$ 0.00%-$ Total 37$ -$ 167$ Roseville Building and Infrastructure (Dale Street Reservoir)0.00%-$ 0.00%-$ 0.00%-$ Equipment and Machinery (meters/valves)0.00%-$ 0.00%-$ 0.00%-$ Total -$ -$ -$ Little Canada Building and Infrastructure (Including meter house/meter)0.00%-$ 0.00%-$ 0.00%-$ Total -$ -$ -$ U of M Total 25.00% 2,094$ 0.00%-$ 25.00% 9,435$ Meters and Billing Total 0.00%-$ 0.00%-$ 0.00%-$ Total Plant Value 28.65% 27,605$ 0.95% 12,385$ 25.79% 47,756$ Maximum HourAverage Day Maximum Day Base Extra Capacity University of Minnesota Page | 13 Cost of Services Allocation of Depreciation (continued) Description %Amount %Amount %Amount Administration Total 82.28% 194,971$ 0.00%-$ 0.00%-$ Business Total Engineering Total 82.28% 18,182$ 0.00%-$ 0.00%-$ Land Total Treatment (Production) Total 82.28% 1,255,449$ 82.28% 1,069,457$ 0.00%-$ Distribution Equipment etc. Building and Structures Equipment Infrastructure Improvements other than Buildings Total 97.66% 1,041,782$ 0.00%-$ 97.66% 4,694,653$ Tanks and Towers Other than McCarrons 100.00% 58,068$ 0.00%-$ 100.00% 261,676$ McCarrons Finished Water Reservoir 82.28% 3,194$ 0.00%-$ 82.28% 14,393$ McCarron's Low Service Tank 0.00%-$ 0.00%-$ 0.00%-$ Total 61,262$ -$ 276,069$ Roseville Building and Infrastructure (Dale Street Reservoir)50.00% 9,776$ 0.00%-$ 50.00% 44,054$ Equipment and Machinery (meters/valves)0.00%-$ 0.00%-$ 0.00%-$ Total 9,776$ -$ 44,054$ Little Canada Building and Infrastructure (Including meter house/meter)0.00%-$ 0.00%-$ 0.00%-$ Total -$ -$ -$ U of M Total 75.00% 6,281$ 0.00%-$ 75.00% 28,305$ Meters and Billing Total 100.00% 800,281$ 0.00%-$ 0.00%-$ Total Plant Value 519.49% 3,387,985$ 82.28% 1,069,457$ 172.66% 5,043,081$ Average Day Maximum Day Maximum Hour Base Extra Capacity Retail Customers Page | 14 Cost of Services Asset Value and Depreciation Allocation Summary The allocation of operations and maintenance expenses generally followed the same logic as the 2017 and 2019 studies. This is based on our understanding that the operations of SPRWS have not changed materially from 2019. The allocation of operating and maintenance expenses to base, maximum day and maximum hour is shown in the table on the following page. The allocation of some expenses was done based on the 2017 and 2019 study including: • 49.50% of administration costs with the exception of safety and security were allocated based on a time allocation of staff in that function • 66.7% of safety and security costs were allocated based on a time allocation of staff in that function • Meter expenses were allocated based on an allocation of staff time and resources • 21.9% of Engineering Maps and Records costs were allocated based on a time allocation of staff in that function • 49.5% of GA employee fringe cost were allocated because they are part of administration In addition, engineering costs related to homeowner lead replacement loans and land sales were not allocated as they do not benefit wholesale customers. The operations and maintenance total expense allocations are shown on the following pages. Description Roseville Little Canada U of M Total Plant Value (Present Worth Allocation)24,824,524$ 5,114,685$ 4,794,985$ 34,734,193$ Return on Investment (5%)1,241,226$ 255,734$ 239,749$ 1,736,710$ Current Depreciation 557,024$ 116,118$ 87,746$ 760,887$ Total Capital Cost 1,798,250$ 371,852$ 327,495$ 2,497,597$ P age | 15 Cost of Services Allocation of O & M Expenses Description O & M Costs % Assigned O & M Cost to Allocate %Amount %Amount %Amount Administration 69082100 AD General Administration 886,865$ 49.50% 438,998$ 100.00% 438,998$ 0.00%-$ 0.00%-$ 69082105 AD Admin Bodg and Campus Ground Mtce 5,699,222$ 49.50% 2,821,115$ 100.00% 2,821,115$ 0.00%-$ 0.00%-$ 69082107 AD Safety and Security 573,049$ 49.50% 283,659$ 100.00% 283,659$ 0.00%-$ 0.00%-$ 69082110 BD Business SS Administration 220,658$ 49.50% 109,226$ 100.00% 109,226$ 0.00%-$ 0.00%-$ 69082115 AD Business Improvement Unit 438,232$ 49.50% 216,925$ 100.00% 216,925$ 0.00%-$ 0.00%-$ 69082120 BD Call Center 1,550,244$ 0.00%-$ 100.00%-$ 0.00%-$ 0.00%-$ 69082130 BD Financial Services 1,783,656$ 49.50% 882,910$ 100.00% 882,910$ 0.00%-$ 0.00%-$ 69082140 BD Information Servicves Unit 3,379,232$ 49.50% 1,672,720$ 100.00% 1,672,720$ 0.00%-$ 0.00%-$ 69082150 BD Meter Operations 1,815,692$ 100.00% 1,815,692$ 100.00% 1,815,692$ 0.00%-$ 0.00%-$ 69082170 AD Travel and Training 227,700$ 49.50% 112,712$ 100.00% 112,712$ 0.00%-$ 0.00%-$ Total 16,574,550$ 8,353,956$ 8,353,956$ -$ -$ DD Mains Hydrant Services 69082210 DD Mains Hydrants services 9,962,691$ 100.00% 9,962,691$ 18.16% 1,809,304$ 0.00%-$ 81.84% 8,153,387$ 69082240 Storehouse and Yard 152,368$ 100.00% 152,368$ 18.16% 27,671$ 0.00%-$ 81.84% 124,697$ 69082260 DD Garage (500)$ 100.00%(500)$ 18.16%(91)$ 0.00%-$ 81.84%(409)$ 69082261 DD Auto Truck Maintenance (450,000)$ 100.00% (450,000)$ 18.16% (81,724)$ 0.00%-$ 81.84% (368,276)$ 69082262 Tractor Maintenance (162,000)$ 100.00% (162,000)$ 18.16% (29,420)$ 0.00%-$ 81.84% (132,580)$ 69082263 Compressor Other Equipment MNTC (57,000)$ 100.00% (57,000)$ 18.16% (10,352)$ 0.00%-$ 81.84% (46,648)$ Total 9,445,559$ 9,445,559$ 1,715,388$ -$ 7,730,171$ Engineering 69082310 ED Engineering Maps Records 4,163,423$ 21.90% 911,790$ 100.00% 911,790$ 0.00%-$ 0.00%-$ 69082350 ED Homeowners Lead Replace Loans 650,000$ 0.00%-$ 100.00%-$ 0.00%-$ 0.00%-$ 69082355 ED Land Sales 3,000$ 0.00%-$ 100.00%-$ 0.00%-$ 0.00%-$ Total 4,816,423$ 911,790$ 911,790$ -$ -$ PD Supply 69082410 PD Supply 2,797,580$ 100.00% 2,797,580$ 54.48%1,524,188$ 45.52% 1,273,392$ 0.00%-$ 69082430 PD Treatment and Pumping 8,020,753$ 100.00% 8,020,753$ 54.48% 4,369,897$ 45.52% 3,650,856$ 0.00%-$ 69082450 PD Water Quality 1,181,355$ 100.00% 1,181,355$ 54.48% 643,630$ 45.52% 537,725$ 0.00%-$ Electricity 1,500,000$ 100.00% 1,500,000$ 100.00% 1,500,000$ 0.00%-$ 0.00%-$ Chemicals 3,750,000$ 100.00% 3,750,000$ 100.00% 3,750,000$ 0.00%-$ 0.00%-$ Total 17,249,688$ 17,249,688$ 11,787,716$ 5,461,972$ -$ GA Employee Fringe Costs 69082610 GA Employee Fringe Costs 180,000$ 49.50% 89,100$ 100.00% 89,100$ 0.00%-$ 0.00%-$ Total 180,000$ 89,100$ 89,100$ -$ -$ Total 48,266,220$ 36,050,093$ 0.00% 22,857,950$ 0.00% 5,461,972$ 0.00% 7,730,171$ Average Day Maximum Day Maximum Hour Total Base Extra Capacity Page | 16 Cost of Services Allocation of O & M Expenses Description %Amount %Amount %Amount Administration 69082100 AD General Administration 13.90% 61,023$ 0.00%-$ 0.00%-$ 69082105 AD Admin Bodg and Campus Ground Mtce 13.90% 392,149$ 0.00%-$ 0.00%-$ 69082107 AD Safety and Security 13.90% 39,430$ 0.00%-$ 0.00%-$ 69082110 BD Business SS Administration 13.90% 15,183$ 0.00%-$ 0.00%-$ 69082115 AD Business Improvement Unit 13.90% 30,154$ 0.00%-$ 0.00%-$ 69082120 BD Call Center 13.90%-$ 0.00%-$ 0.00%-$ 69082130 BD Financial Services 13.90% 122,729$ 0.00%-$ 0.00%-$ 69082140 BD Information Servicves Unit 13.90% 232,516$ 0.00%-$ 0.00%-$ 69082150 BD Meter Operations 8,473$ 0.00%-$ 0.00%-$ 69082170 AD Travel and Training 13.90% 15,667$ 0.00%-$ 0.00%-$ Total 917,324$ -$ -$ DD Mains Hydrant Services 69082210 DD Mains Hydrants services 1.09% 19,794$ 0.00%-$ 1.09% 89,199$ 69082240 Storehouse and Yard 1.09%303$ 0.00%-$ 1.09% 1,364$ 69082260 DD Garage 1.09%(1)$ 0.00%-$ 1.09%(4)$ 69082261 DD Auto Truck Maintenance 1.09%(894)$ 0.00%-$ 1.09% (4,029)$ 69082262 Tractor Maintenance 1.09%(322)$ 0.00%-$ 1.09% (1,450)$ 69082263 Compressor Other Equipment MNTC 1.09%(113)$ 0.00%-$ 1.09%(510)$ Total 18,767$ -$ 84,569$ Engineering 69082310 ED Engineering Maps Records 13.90% 126,743$ 0.00%-$ 0.00%-$ 69082350 ED Homeowners Lead Replace Loans 13.90%-$ 0.00%-$ 0.00%-$ 69082355 ED Land Sales 13.90%-$ 0.00%-$ 0.00%-$ Total 126,743$ -$ -$ PD Supply 69082410 PD Supply 13.90% 211,870$ 13.90% 177,008$ 0.00%-$ 69082430 PD Treatment and Pumping 13.90% 607,437$ 13.90% 507,487$ 0.00%-$ 69082450 PD Water Quality 13.90% 89,468$ 13.90% 74,746$ 0.00%-$ Electricity 13.90% 208,507$ 13.90%-$ 0.00%-$ Chemicals 13.90% 521,269$ 13.90%-$ 0.00%-$ Total 1,638,551$ 759,241$ -$ GA Employee Fringe Costs 69082610 GA Employee Fringe Costs 13.90% 12,385$ 0.00%-$ 0.00%-$ Total 12,385$ -$ -$ Total 0.00% 2,713,771$ 0.00% 759,241$ 0.00% 84,569$ Maximum HourAverage Day Maximum Day Roseville Base Extra Capacity Page | 17 Cost of Services Allocation of O & M Expenses Description %Amount %Amount %Amount Administration 69082100 AD General Administration 2.87% 12,594$ 0.00%-$ 0.00%-$ 69082105 AD Admin Bodg and Campus Ground Mtce 2.87% 80,932$ 0.00%-$ 0.00%-$ 69082107 AD Safety and Security 2.87% 8,138$ 0.00%-$ 0.00%-$ 69082110 BD Business SS Administration 2.87% 3,133$ 0.00%-$ 0.00%-$ 69082115 AD Business Improvement Unit 2.87% 6,223$ 0.00%-$ 0.00%-$ 69082120 BD Call Center 2.87%-$ 0.00%-$ 0.00%-$ 69082130 BD Financial Services 2.87% 25,329$ 0.00%-$ 0.00%-$ 69082140 BD Information Servicves Unit 2.87% 47,987$ 0.00%-$ 0.00%-$ 69082150 BD Meter Operations 2,188$ 0.00%-$ 0.00%-$ 69082170 AD Travel and Training 2.87% 3,233$ 0.00%-$ 0.00%-$ Total 189,758$ -$ -$ DD Mains Hydrant Services 69082210 DD Mains Hydrants services 0.45% 8,203$ 0.00%-$ 0.45% 36,964$ 69082240 Storehouse and Yard 0.45%125$ 0.00%-$ 0.45%565$ 69082260 DD Garage 0.45%(0)$ 0.00%-$ 0.45%(2)$ 69082261 DD Auto Truck Maintenance 0.45%(371)$ 0.00%-$ 0.45% (1,670)$ 69082262 Tractor Maintenance 0.45%(133)$ 0.00%-$ 0.45%(601)$ 69082263 Compressor Other Equipment MNTC 0.45%(47)$ 0.00%-$ 0.45%(211)$ Total 7,777$ -$ 35,045$ Engineering 69082310 ED Engineering Maps Records 2.87% 26,157$ 0.00%-$ 0.00%-$ 69082350 ED Homeowners Lead Replace Loans 2.87%-$ 0.00%-$ 0.00%-$ 69082355 ED Land Sales 2.87%-$ 0.00%-$ 0.00%-$ Total 26,157$ -$ -$ PD Supply 69082410 PD Supply 2.87% 43,726$ 2.87% 36,531$ 0.00%-$ 69082430 PD Treatment and Pumping 2.87% 125,364$ 2.87% 104,736$ 0.00%-$ 69082450 PD Water Quality 2.87% 18,465$ 2.87% 15,426$ 0.00%-$ Electricity 2.87% 43,032$ 2.87%-$ 0.00%-$ Chemicals 2.87% 107,580$ 2.87%-$ 0.00%-$ Total 338,167$ 156,694$ -$ GA Employee Fringe Costs 69082610 GA Employee Fringe Costs 2.87% 2,556$ 0.00%-$ 0.00%-$ Total 2,556$ -$ -$ Total 0.00% 564,416$ 0.00% 156,694$ 0.00% 35,045$ Average Day Maximum Day Maximum Hour Extra Capacity Little Canada Base Page | 18 Cost of Services Allocation of O & M Expenses Description %Amount %Amount %Amount Administration 69082100 AD General Administration 0.95% 4,183$ 0.00%-$ 0.00%-$ 69082105 AD Admin Bodg and Campus Ground Mtce 0.95% 26,881$ 0.00%-$ 0.00%-$ 69082107 AD Safety and Security 0.95% 2,703$ 0.00%-$ 0.00%-$ 69082110 BD Business SS Administration 0.95% 1,041$ 0.00%-$ 0.00%-$ 69082115 AD Business Improvement Unit 0.95% 2,067$ 0.00%-$ 0.00%-$ 69082120 BD Call Center 0.95%-$ 0.00%-$ 0.00%-$ 69082130 BD Financial Services 0.95% 8,413$ 0.00%-$ 0.00%-$ 69082140 BD Information Servicves Unit 0.95% 15,938$ 0.00%-$ 0.00%-$ 69082150 BD Meter Operations 2,807$ 0.00%-$ 0.00%-$ 69082170 AD Travel and Training 0.95% 1,074$ 0.00%-$ 0.00%-$ Total 65,106$ -$ -$ DD Mains Hydrant Services 69082210 DD Mains Hydrants services 0.79% 14,360$ 0.00%-$ 0.79% 64,713$ 69082240 Storehouse and Yard 0.79%220$ 0.00%-$ 0.79%990$ 69082260 DD Garage 0.79%(1)$ 0.00%-$ 0.79%(3)$ 69082261 DD Auto Truck Maintenance 0.79%(649)$ 0.00%-$ 0.79% (2,923)$ 69082262 Tractor Maintenance 0.79%(234)$ 0.00%-$ 0.79% (1,052)$ 69082263 Compressor Other Equipment MNTC 0.79%(82)$ 0.00%-$ 0.79%(370)$ Total 13,615$ -$ 61,354$ Engineering 69082310 ED Engineering Maps Records 0.95% 8,688$ 0.00%-$ 0.00%-$ 69082350 ED Homeowners Lead Replace Loans 0.95%-$ 0.00%-$ 0.00%-$ 69082355 ED Land Sales 0.95%-$ 0.00%-$ 0.00%-$ Total 8,688$ -$ -$ PD Supply 69082410 PD Supply 0.95% 14,523$ 0.95% 12,133$ 0.00%-$ 69082430 PD Treatment and Pumping 0.95% 41,638$ 0.95% 34,787$ 0.00%-$ 69082450 PD Water Quality 0.95% 6,133$ 0.95% 5,124$ 0.00%-$ Electricity 0.95% 14,293$ 0.95%-$ 0.00%-$ Chemicals 0.95% 35,732$ 0.95%-$ 0.00%-$ Total 112,318$ 52,044$ -$ GA Employee Fringe Costs 69082610 GA Employee Fringe Costs 0.95%849$ 0.00%-$ 0.00%-$ Total 849$ -$ -$ Total 0.00% 200,576$ 0.00% 52,044$ 0.00% 61,354$ Maximum HourAverage Day Maximum Day Base Extra Capacity University of Minnesota Page | 19 Cost of Services Allocation of O & M Expenses The operations and maintenance expenses allocated to each wholesale customer using the base extra capacity method resulted in the amounts shown below. Description %Amount %Amount %Amount Administration 69082100 AD General Administration 82.28% 361,198$ 0.00%-$ 0.00%-$ 69082105 AD Admin Bodg and Campus Ground Mtce 82.28% 2,321,153$ 0.00%-$ 0.00%-$ 69082107 AD Safety and Security 82.28% 233,389$ 0.00%-$ 0.00%-$ 69082110 BD Business SS Administration 82.28% 89,869$ 0.00%-$ 0.00%-$ 69082115 AD Business Improvement Unit 82.28% 178,481$ 0.00%-$ 0.00%-$ 69082120 BD Call Center 82.28%-$ 0.00%-$ 0.00%-$ 69082130 BD Financial Services 82.28% 726,439$ 0.00%-$ 0.00%-$ 69082140 BD Information Servicves Unit 82.28% 1,376,278$ 0.00%-$ 0.00%-$ 69082150 BD Meter Operations 1,802,224$ 0.00%-$ 0.00%-$ 69082170 AD Travel and Training 82.28% 92,737$ 0.00%-$ 0.00%-$ Total 7,181,767$ -$ -$ DD Mains Hydrant Services 69082210 DD Mains Hydrants services 97.66% 1,766,947$ 0.00%-$ 97.66% 7,962,511$ 69082240 Storehouse and Yard 97.66% 27,023$ 0.00%-$ 97.66% 121,778$ 69082260 DD Garage 97.66%(89)$ 0.00%-$ 97.66%(400)$ 69082261 DD Auto Truck Maintenance 97.66% (79,810)$ 0.00%-$ 97.66% (359,655)$ 69082262 Tractor Maintenance 97.66% (28,732)$ 0.00%-$ 97.66% (129,476)$ 69082263 Compressor Other Equipment MNTC 97.66% (10,109)$ 0.00%-$ 97.66% (45,556)$ Total 1,675,230$ -$ 7,549,202$ Engineering 69082310 ED Engineering Maps Records 82.28% 750,201$ 0.00%-$ 0.00%-$ 69082350 ED Homeowners Lead Replace Loans 82.28%-$ 0.00%-$ 0.00%-$ 69082355 ED Land Sales 82.28%-$ 0.00%-$ 0.00%-$ Total 750,201$ -$ -$ PD Supply 69082410 PD Supply 82.28% 1,254,069$ 82.28% 1,047,719$ 0.00%-$ 69082430 PD Treatment and Pumping 82.28% 3,595,458$ 82.28% 3,003,846$ 0.00%-$ 69082450 PD Water Quality 82.28% 529,565$ 82.28% 442,428$ 0.00%-$ Electricity 82.28% 1,234,168$ 82.28%-$ 0.00%-$ Chemicals 82.28% 3,085,420$ 82.28%-$ 0.00%-$ Total 9,698,679$ 4,493,994$ -$ GA Employee Fringe Costs 69082610 GA Employee Fringe Costs 82.28% 73,310$ 0.00%-$ 0.00%-$ Total 73,310$ -$ -$ Total 0.00% 19,379,187$ 0.00% 4,493,994$ 0.00% 7,549,202$ Average Day Maximum Day Maximum Hour Base Extra Capacity Retail Customers Wholesale Customer O & M Cost Allocation Roseville 3,557,581$ Little Canada 756,155$ U o f M 313,974$ Total 4,627,710$ Page | 20 Cost of Services The total cost of providing services to the wholesale customers based on FY 2022 costs is the sum of the capital costs and the operations and maintenance costs. This amount is the revenue each wholesale customer should provide to SPRWS. These are shown below. The base rate and volume fee for each retail customer was estimated by applying the logic used in the 2017 and 2019 studies. Specifically, that logic set the volume rate for Roseville and Little Canada at 60% of the blended rate for SPRWS retail customers and the U of M volume rate at 92% of the SPRWS blended retail rate. The base fee was then determined to provide the balance of the revenue not coming from volume rates. The FY 2022 base and volume rates were calculated to provide the total revenues determined from the base extra capacity analysis. The rates for future years were projected using the percentage increases recommended in the financial projections. The resulting projected revenues, base rates, and volume rates for each wholesale customer are shown on the following page. FY 2022 Description Roseville Little Canada U of M Total Plant Value (Present Worth Allocation)24,824,524$ 5,114,685$ 4,794,985$ 34,734,193$ Return on Investment (5%)1,241,226$ 255,734$ 239,749$ 1,736,710$ Current Depreciation 557,024$ 116,118$ 87,746$ 760,887$ Total Capital Cost 1,798,250$ 371,852$ 327,495$ 2,497,597$ O & M Cost 3,557,581$ 756,155$ 313,974$ 4,627,710$ Total Revenue 5,355,831$ 1,128,007$ 641,469$ 7,125,306$ Page | 21 Cost of Services Wholesale Customer Revenues and Charges The findings and preliminary recommendations in this memorandum are based on information provided to Baker Tilly for this study. We understand that after the SPRWS staff has an opportunity to review and discuss both the analysis and preliminary recommendations some revisions may be needed. Future Years 2022 2023 2024 2025 2026 2027 Total Revenue Requirement 7,125,306$ 7,802,211$ 8,348,365$ 8,932,751$ 9,379,388$ 9,848,358$ Roseville Revenue Requirement 5,355,831$ 5,864,635$ 6,275,159$ 6,714,421$ 7,050,142$ 7,402,649$ Preliminary Volume Rate 2.03$ 2.22$ 2.38$ 2.54$ 2.669389$ 2.80$ Preliminary Volume Fee Revenue 4,647,831$ 5,089,375$ 5,445,631$ 5,826,825$ 6,118,167$ 6,424,075$ Base fee revenue 708,000$ 775,260$ 829,528$ 887,595$ 931,975$ 978,574$ Monthly Base Fee rounded 59,000$ 64,600$ 69,100$ 74,000$ 77,700$ 81,500$ Base fee revenue rounded 708,000$ 775,200$ 829,200$ 888,000$ 932,400$ 978,000$ Volume Fee Revenue needed 4,647,831$ 5,089,435$ 5,445,959$ 5,826,421$ 6,117,742$ 6,424,649$ Volume rate 2.03$ 2.22$ 2.38$ 2.54$ 2.67$ 2.80$ Little Canada Revenue Requirement 1,128,007$ 1,235,167$ 1,321,629$ 1,414,143$ 1,484,850$ 1,559,093$ Preliminary Volume Rate 2.03$ 2.22$ 2.38$ 2.54$ 2.67$ 2.80$ Preliminary Volume Fee Revenue 959,287$ 1,050,419$ 1,123,949$ 1,202,625$ 1,262,756$ 1,325,894$ Base fee revenue 168,720$ 184,748$ 197,680$ 211,518$ 222,094$ 233,199$ Monthly Base Fee rounded 14,100$ 15,400$ 16,500$ 17,600$ 18,500$ 19,400$ Base fee revenue rounded 169,200$ 184,800$ 198,000$ 211,200$ 222,000$ 232,800$ Volume Fee Revenue needed 958,807$ 1,050,367$ 1,123,629$ 1,202,943$ 1,262,850$ 1,326,293$ Volume rate 2.03$ 2.22$ 2.38$ 2.54$ 2.67$ 2.80$ U of M Revenue Requirement 641,469$ 702,408$ 751,577$ 804,187$ 844,397$ 886,617$ Preliminary Volume Rate 3.11$ 3.41$ 3.64$ 3.90$ 4.09$ 4.30$ Preliminary Volume Fee Revenue 488,545$ 534,956$ 572,403$ 612,471$ 643,095$ 675,250$ Base fee revenue 152,924$ 167,452$ 179,174$ 191,716$ 201,302$ 211,367$ Monthly Base Fee rounded 12,700$ 14,000$ 14,900$ 16,000$ 16,800$ 17,600$ Base fee revenue rounded 152,400$ 168,000$ 178,800$ 192,000$ 201,600$ 211,200$ Volume Fee Revenue needed 489,069$ 534,408$ 572,777$ 612,187$ 642,797$ 675,417$ Volume rate 3.11$ 3.40$ 3.65$ 3.90$ 4.09$ 4.30$ AMENDMENT NO. 3 TO CONTRACT FOR WATER SERVICES between THE BOARD OF WATER COMMISSIONERS OF THE CITY OF SAINT PAUL and CITY OF LITTLE CANADA, MINNESOTA This AMENDMENT NO. 3 TO CONTRACT FOR WATER SERVICES is entered into this ______day of _________________, 2023, by and between the BOARD OF WATER COMMISSIONERS OF THE CITY OF SAINT PAUL, a municipal corporation of the State of Minnesota (the “Board”), and the CITY OF LITTLE CANADA, MINNESOTA, a municipal corporation of the State of Minnesota (“Little Canada”) WHEREAS, Little Canada and the Board entered into a Contract For Water Services dated November 27, 2006 to furnish and provide water to Little Canada (the “Agreement”); and WHEREAS, Little Canada and the Board entered into an Amendment No. 1 to Contract For Water Services dated March 10, 2015 with an effective date of January 1, 2013, which provided for revised water charges and that after a five-year period, the parties would review fees and charges to be addressed by a Cost of Service Study; and WHEREAS, Little Canada and the Board entered into an Amendment No. 2 to Contract For Water Services dated April 10, 2018, with an effective date of January 1, 2018, which provided for revised water charges and that after a five-year period, the parties would review fees and charges to be addressed by a Cost of Service Study; and WHEREAS, the parties have reviewed such fees and charges addressed by a Cost of Service Study and at this time desire to further amend the Agreement to provide for revised water charges and rates; and WHEREAS, Section 10.04 of the Agreement provides for amendments to the Agreement by a written instrument executed by the parties, and this Amendment No. 3 to Contract For Water Services is intended by the parties to be such an instrument. NOW, THEREFORE, in consideration of the mutual covenants contained herein, the parties mutually agree to amend the Agreement according to the following: 1. Section 7.01 is hereby replaced in its entirety with the following: SECTION 7.01 Rates A. The rates for water sold by the Board to Little Canada under this Agreement (“Charges”) shall consist of two components: 1) Water Service Base Fee The Water Service Base Fee is intended to recover the fixed costs incurred by the Board for its provision of water to Little Canada. The Water Service Base Fee shall be charged monthly in accordance with the following yearly schedule. 2023 $15,400/month (totaling $184,400) 2024 $16,500/month (totaling $198,000) 2025 $17,600/month (totaling $211,200) 2026 $18,500/month (totaling $222,000) 2027 $19,400/month (totaling $232,800) 2) Water Volume Charge The Water Volume Charge is the product of a rate equal to 60% of the lowest seasonal rate per one hundred (100) cubic feet charged to retail water customers in the City of Saint Paul and the volume of water provided to Little Canada at the Point of Delivery. The Water Volume Charge shall be charged at the same time and frequency as the Water Service Base Fee. B. The parties agree to review the Charges every five (5) years or if a significant change to the Board’s retail billing structure is implemented. This review shall include a cost-of-service study, which shall review the return on Board assets, asset allocations and other economic factors. All costs for this review shall be shared equally by the Board, its other wholesale customers, and Little Canada. C. Notwithstanding the above, if, whether as a result of such review or otherwise, the Board changes its retail billing structure in any way, either of its own accord or at the requirement of other governmental entities, both parties agree that the Charges will be adjusted. All reasonable effort shall be taken to make sure this adjustment shall not harm Little Canada by increasing Little Canada’s overall cost or harm the Board by decreasing the Board’s overall revenue under the contract. 2. The effective date of this Amendment shall be January 1, 2023. 3. All other provisions of the original Agreement shall remain in full force and effect. [The remainder of this page left intentionally blank.] IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 3 to Contract For Water Services to be executed as of the day and year first above written. CITY OF LITTLE CANADA, MINNESOTA By _________________________________ Thomas Fischer, Mayor By _________________________________ Christopher Heineman, City Administrator BOARD OF WATER COMMISSIONERS OF THE CITY OF SAINT PAUL Approved: By_________________________________ By_________________________________ Patrick Shea, General Manager Mara Humphrey, President Saint Paul Regional Water Services Approved as to form: By_________________________________ By_________________________________ Assistant City Attorney Mollie Gagnelius, Secretary By_________________________________ Todd Hurley, Director Office of Financial Services STAFF REPORT TO: Mayor Fischer and Members of City Council FROM: Chris Heineman, City Administrator DATE: July 26, 2023 RE: Resolution Granting Approval to a project to be undertaken by Ramsey County HRA ACTION TO BE CONSIDERED: The City Council is asked to consider a Motion to adopt a Resolution Granting Approval to a project to be undertaken by Ramsey County HRA at Provinces Apartments in Little Canada. BACKGROUND: City staff was contacted by attorney Jenny Boulton from Kennedy & Graven working on behalf of the Ramsey County Housing and Redevelopment Authority (HRA) to request consideration of the attached Resolution. The Ramsey County HRA has awarded a forgivable loan in the aggregate principal amount of $305,319 for rehabilitation of two existing apartment buildings located at 155 Little Canada Road East (Provinces Apartments). According to MN Statutes Sections 469.004– 469.041, the governing body of the municipality in which the project is located must be notified and approve the project prior to commencement of the project as described in the following section of MN Statute: THE ACT REQUIRES THAT PRIOR TO THE COMMENCEMENT OF A PROJECT BY THE COUNTY ACTING AS A HOUSING AND REDEVELOPMENT AUTHORITY, THE GOVERNING BODY OF THE MUNICIPALITY IN WHICH THE PROJECT IS TO BE LOCATED SHALL, BY MAJORITY VOTE, APPROVE THE PROJECT, AND THE PROJECT IS PRESENTED HERE FOR APPROVAL BY THE CITY COUNCIL OF THE CITY. The City Council was asked to approve the attached resolution authorizing the Ramsey County HRA to exercise its powers for the AEON Provinces project in Little Canada. RECOMMENDED ACTION: Staff recommends City Council approval of a Motion to adopt a Resolution Granting Approval to a project to be undertaken by Ramsey County HRA at Provinces Apartments in Little Canada. CITY OF LITTLE CANADA COUNTY OF RAMSEY STATE OF MINNESOTA RESOLUTION 2023-7- RESOLUTION GRANTING APPROVAL TO A PROJECT TO BE UNDERTAKEN BY RAMSEY COUNTY ACTING AS A HOUSING AND REDEVELOPMENT AUTHORITY PURSUANT TO MINNESOTA STATUTES, SECTION 469.004, SUBDIVISION 1A. WHEREAS, Ramsey County (the “County”), exercising the powers of a housing and redevelopment authority pursuant to Minnesota Statutes, Sections 469.001 through 469.068, as amended (the “Act”), including without limitation Sections 469.004, subd. 1a and 469.041 thereof, and Minnesota Statutes, Sections 383A.06 and 469.192 (collectively, the “Act”), has received a request from Provinces Preservation JV LLC, a Minnesota limited liability company (the “Borrower”), for a loan in the aggregate principal amount of $305,319 (the “Loan”) for (i) the rehabilitation of an existing two building, 118-unit affordable housing development, known as The Provinces Apartments and located at 155 Little Canada Road East, Little Canada, Minnesota (the “City”), including by not limited to the replacement of approximately 115 windows and approximately 40 patio doors in the 153 building; and (ii) the costs of issuance and other related costs in connection with the Loan (the “Project”), and the County and the Developer have caused to be prepared a Loan Agreement and other documents related to the Loan; and WHEREAS, the Act requires that prior to the commencement of a project by the County acting as a housing and redevelopment authority, the governing body of the municipality in which the project is to be located shall, by majority vote, approve the project, and the Project is presented here for approval by the City Council of the City. NOW, THEREFORE, be it resolved by the City Council of the City of Little Canada, Minnesota, that: 1. The City Council has had the opportunity to review and consider the Project, as recommended by the County, and hereby approves the Project in accordance with the Act 2. Notwithstanding Minnesota Statutes § 469.008, the County is authorized to exercise its powers, including without limitation making the Loan for the Project, within the City. 3. The authorization granted herein is given on condition that the County’s exercise of its powers will not alter, limit or impair the powers of the City’s or its economic development authority or housing and redevelopment authority. Adopted this 26th day of July, 2023. _____________________________________ Thomas Fischer, Mayor Attest: ____________________________________ Christopher Heineman, City Administrator