07-25-2012 Council Minutes - Laserfiche WebLink

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MINUTES CITY COUNCIL JULY 25, 2012 2011 AUDIT PRESENTATION Peggy Moeller, HLB Tautges Redpath, Ltd., City Auditors, appeared before the Council and presented the 2011 Audit. The reports issued relative to the Audit include the City's Annual Financial Report, Report on Internal Control, Communication With Those Charged With Governance, and State Legal Compliance Report. With regard to the Annual Financial Report, Moeller noted that Tautges Redpath is issuing a clean opinion on the 2011 financial statements. Moeller then reviewed the City's property tax collection rate noting that for 2011 it was 99.16 %, which is average at this time. Moeller indicated that at the end of 2011 the City's total bonded debt was $8,430,000 which includes Tax Increment Bonds and Improvement Bonds. This debt is supported by revenue sources other than general property taxes. Moeller reported that the General Fund balance at the end of 2011 was $2,784,528 and noted that both revenues and expenditures exceeded budget with the result being a surplus of $144,501. Moeller indicated that the variances are more a function of how the City budgets. As an example, Moeller noted that the City accounted for the Ramsey County Sheriff expense and related service credits in a different manner than was presented in the audit. This resulted in both refunds and reimbursement (revenue) and police protection (expense) being over budget and fine revenue being under budget. The net effect of the differences contributes to the increase in fund balance. Moeller reviewed the City's policy relative to the General Fund's minimum unassigned fund balance. It states that funds in excess of 65% are available for transfers to other funds, which have historically been the General Capital Improvement Fund. This City has not made this transfer for a few years. The City Administrator indicated that given issues such as the instability with LGA dollars, the transfer was not made. He anticipated that the transfer will be made in 2012 given that these funding sources to have stabilized. Moeller reviewed the Report on Internal Control noting the only finding is the lack of segregation of duties. She pointed out that the City has had this finding for many years, and is a function of having a small staff. Even if staff were added, Moeller indicated it would be unlikely that the finding would be resolved. Moeller reviewed the Communication With Those Charged With Governance, and reported that there were no disagreements with management or significant difficulties encountered in performing the audit. Moeller then noted the GASB Statement No. 54 definitions that were implements for the year ending December 31, 2011. She also noted that 9